Ahmad v Insurance Australia Ltd T/As NRMA [2025] ACAT 11
In this recent decision of the ACT Civil and Administrative Tribunal (ACAT), the insurer’s refusal to fund knee surgery under the Motor Accident Injuries Act 2019 (MAI Act) was upheld.
Jesse Iliopoulos of Meridian Lawyers represented the respondent insurer, Insurance Australia Ltd trading as NRMA, at hearing.
Key Takeaways
Evidence-based medical opinions carry significant weight – When competing medical opinions exist, decision-makers will carefully consider whether opinions are supported by objective medical evidence and established clinical practice, in particular, relevant medical literature for the specific condition.
Procedural fairness in medical assessments – Insurers are not required to provide applicants with additional opportunities to submit material when seeking clarification of an independent medical examiner’s existing opinion, provided the applicant had adequate opportunity to present their case initially.
Conservative treatment failure alone does not mandate surgical approval – The fact that physiotherapy and non-operative management have been unsuccessful does not automatically establish that surgical intervention is reasonable and necessary under the Motor Accident Injuries Act 2019 (ACT).
ACAT confirms scope of judicial review jurisdiction – The ACT Civil and Administrative Tribunal’s role in reviewing insurer decisions is one of judicial review, examining whether the decision was affected by errors of law or fact. This approach is different to a a merits review, which would substitute the tribunal’s judgment for that of the insurer.
Factual Background
Mr Ahmad sustained a work-related right knee injury in 2015, requiring surgery performed by Dr Rizkallah Sherif on 28 August 2015. He was certified fit for pre-injury duties in September 2020. On 29 March 2023, Mr Ahmad was injured in a motor vehicle accident when another vehicle failed to give way. Insurance Australia Ltd T/As NRMA accepted liability under the Motor Accident Injuries Act 2019.
Following the accident, Mr Ahmad’s treating orthopaedic surgeon, Dr Asher Livingston, initially recommended non-operative management. However, by February 2024, Dr Livingston concluded that the motor vehicle accident had “stirred up” the right knee degeneration, and recommended arthroscopy to clean up loose chondral flaps. On 15 March 2024, Dr Livingston formally requested approval for right knee arthroscopy and debridement, stating that the procedure was needed to provide symptomatic relief and improve day-to-day function.
The insurer obtained an independent medical examination from Dr Raymond Wallace, who diagnosed the condition as an aggravation of pre-existing degenerative osteoarthritis. Dr Wallace concluded that Mr Ahmad would not benefit from operative intervention, citing lack of objective medical evidence that arthroscopic debridement leads to durable symptom reduction or functional improvement over conservative treatment. He relied on a Cochrane review, which indicated that the evidence in favour of arthroscopic surgery over non-surgical treatments was of low quality.
After considering both medical opinions and the available evidence, and acknowledging that the accident had caused an aggravation of the pre-existing condition, the insurer declined the treatment request on 7 November 2024.The internal review affirmed this decision on 17 December 2024.,
Statutory Framework for Treatment Approval – Prior or Projected Care?
Presidential Member Lucy clarified the legislative framework governing treatment and care benefits under the Motor Accident Injuries Act 2019. Section 120 requires insurers to consider whether treatment is:
- reasonable and necessary in the circumstances
- directly related to, and appropriate for, the injury
- will benefit the person
- involves an appropriate provider
- is cost-effective, and
- complies with the MAI guidelines.
The Court noted an interesting statutory interpretation issue regarding whether the MAI Act contemplates prospective approval of treatment (before expenses are incurred) or only retrospective reimbursement. While the definition of “treatment and care expenses” uses past tense (“expenses incurred”), section 120’s language suggests prospective assessment is permissible. Presidential Member Lucy assumed the parties’ joint position that prospective assessment was appropriate, though noted that this remained an open question.
Judicial Review Standard
The tribunal’s jurisdiction is one of judicial review under section 197 of the MAI Act, examining decisions “on questions of law or fact” only. As Presidential Member Lucy emphasised, this is not a merits review where the tribunal would substitute its own judgment on the substantive decision, but rather a judicial review examining whether the insurer’s decision-making process was affected by errors of law or fact. The tribunal must only consider information available to the decision-maker when the decision was made, though it may grant leave for additional evidence that was not reasonably available at the time.
This judicial review framework means the tribunal cannot simply disagree with the insurer’s assessment and reach a different conclusion on the merits. Instead, it must identify specific legal or factual errors in the decision-making process that would warrant setting aside or varying the decision.
Allegations of Overlooking Information
Mr Ahmad’s primary ground was that the internal reviewer overlooked crucial information. However, his specific complaints were not substantiated. The tribunal found that Dr Wallace had been provided with relevant records from the workers’ compensation insurer and Dr Sherif’s reports. While Mr Ahmad complained that Dr Wallace didn’t review his “statement of evidence,” this document was not before the tribunal, making it impossible to assess whether any error occurred.
Significantly, the tribunal established that even if a medical examiner fails to consider some information, this only constitutes a reviewable error if the information was material and could have realistically affected the outcome. The workers’ compensation closure letter relied upon by Mr Ahmad was found to be non-probative, as it merely indicated he told his insurer he didn’t require treatment for an unspecified injury.
Medical Opinion and Evidence-Based Treatment
The core dispute centred on competing medical opinions between the treating surgeon and the independent examiner. Dr Livingston favoured surgical intervention based on his clinical assessment and belief that conservative treatment had failed. Dr Wallace opposed surgery based on his finding of only mild symptoms, the absence of significant disability on examination, MRI evidence of only mild tricompartmental cartilage irregularity, and most importantly, lack of medical literature supporting chondroplasty for mild to moderate osteoarthritis.
Presidential Member Lucy found no error in Dr Wallace’s approach or the internal reviewer’s preference for his opinion. Under the judicial review framework, the tribunal cannot substitute its medical judgment for that of qualified practitioners – it can only determine whether the decision-maker made an error in relying on the medical evidence before them. Without expert evidence challenging Dr Wallace’s reliance on medical literature, his evidence-based approach disclosed no reviewable error.
Conservative Treatment Failure
Mr Ahmad argued that after a year of physiotherapy and observation, conservative treatment had proved ineffective, therefore surgical intervention should be approved. The tribunal rejected this reasoning, noting that failure of conservative treatment does not necessarily establish that surgery will be effective. Both treatments could potentially be ineffective, and the lack of literature support for the surgical option was the decisive factor.
Procedural Fairness in Medical Assessments
An important procedural issue arose regarding the insurer’s request for a supplementary report from Dr Wallace clarifying his opinion. Mr Ahmad argued this breached procedural fairness as he wasn’t given an opportunity to respond. The tribunal rejected this argument. It found that requesting clarification of an existing opinion, without introducing new material, does not require additional consultation with the applicant, provided they had adequate opportunity to present their case initially.
Good Faith and Delay Concerns
While not a formal ground of review, Mr Ahmad raised complaints about the insurer’s conduct, including alleged delay and failure to act in good faith. Presidential Member Lucy reiterated that under the judicial review framework, the tribunal’s jurisdiction is limited to identifying errors of law or fact in the specific reviewable decision, not conducting general investigations into insurer conduct or broader process issues. The nine-month timeframe for decision-making was explained by the need to obtain additional medical reports and did not constitute a reviewable error that affected the ultimate decision.
Treatment and Care Guidelines Application
The decision provides useful guidance on applying the Motor Accident Injuries (Treatment and Care) Guidelines 2023. Under clause 6.4.2, treatment will be considered to benefit a person if there are medical reports demonstrating the treatment’s potential to improve the injured person’s recovery. However, this must be balanced against clause 6.4.3, which requires treatment to be based on current clinical practice, evidence-based practice, or generally accepted clinical guidelines, with good evidence for efficacy over other treatments.
The case demonstrates that subjective clinical opinion, even from a treating specialist, may be insufficient if not supported by objective evidence and medical literature, particularly where an independent examiner provides evidence-based analysis to the contrary.
Conclusion
This decision reinforces the importance of evidence-based medicine in treatment approval decisions under the MAI Act and clarifies the judicial review framework within which ACAT operates.
It demonstrates that when competing medical opinions exist, decision-makers should carefully consider whether opinions are supported by objective medical evidence and established clinical practice, in particular, relevant medical literature for the specific condition.
Finally, the case establishes that insurers are not required to provide applicants with additional opportunities to submit material when seeking clarification of an independent medical examiner’s existing opinion, provided the applicant had adequate opportunity to present their case initially.
Further information
This article was written by Principal Angel Li and Senior Associate Jesse Iliopoulos. For further information or advice on any related matters please contact Angel.
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