DETERMINATION OF APPEAL PANEL	
	
CITATION:	Patarker Pty Ltd ATF The Bigeni Family Trust v Hosking [2024] NSWPICMP 601	
		
APPELLANT:	Patarker Pty Ltd atf The Bigeni Family Trust	
		
RESPONDENT:	Christopher Hosking	
		
Appeal Panel		
		
MEMBER:	Marshal Douglas	
		
MEDICAL ASSESSOR:	David Croker	
		
MEDICAL ASSESSOR:	John Brian Stephenson	
		
DATE OF DECISION:	26 August 2024	
		
CATCHWORDS: 	wORKERS cOMPENSATION - Workplace Injury Management and Workers Compensation Act 1998; whether Medical Assessor (MA) was correct to assume in accordance with section 323(2) that the deductible proportion for section 323(1) was 10%; Held – MA was correct to do so; Medical Assessment Certificate confirmed.

BACKGROUND TO THE APPLICATION TO APPEAL
1.	On 20 May 2024 Partarker Pty Ltd, the appellant, lodged an Application to Appeal Against the Decision of a Medical Assessor. The medical dispute was assessed by Dr Peter Honeyman, a Medical Assessor, who issued a Medical Assessment Certificate (MAC) on 
22 April 2024.
2.	The appellant relies on the following grounds of appeal under s 327(3) of the Workplace Injury Management and Workers Compensation Act 1998 (1998 Act): 
•	the assessment was made on the basis of incorrect criteria, and
•	the MAC contains a demonstrable error.
3.	The delegate is satisfied that, on the face of the application, at least one ground for appeal has been made out. The Appeal Panel has conducted a review of the original medical assessment but limited to the grounds for appeal on which the appeal is made. 
4.	Rule 128 of the Personal Injury Commission Rules 2021 (PIC Rules) and Procedural Direction PIC7 - Appeals, reviews, reconsiderations and correction of obvious errors in medical disputes set out the practice and procedure in relation to the medical appeal process under s 328 of the 1998 Act. An Appeal Panel determines its own procedures in accordance with r 128(1) of the PIC Rules.
5.	The assessment of permanent impairment is conducted in accordance with the SIRA NSW Workers Compensation Guidelines for the Evaluation of Permanent Impairment, 4th ed 
1 March 2021 (the Guidelines) and the American Medical Association Guides to the Evaluation of Permanent Impairment, 5th ed (AMA 5). 
RELEVANT FACTUAL BACKGROUND
6.	In September 2015 Christopher Hosking commenced employment as a warehouse manager with the appellant.  On 5 June 2019 he was working for the appellant unloading material from the back of a utility at a piggery.  His left foot went through a pallet on which he was standing causing him to jar his back.  He suffered lower back pain and left lower limb pain.
7.	The respondent had experienced low back pain before he commenced his employment with the appellant, for which he had surgery in the form of a L4/5 discectomy that orthopaedic surgeon Dr Brian Hsu performed in July 2021.  The respondent had a good outcome from that surgery and indeed until the incident on 5 June 2019 was able to carry out arduous work in full-time employment.
8.	Following the incident on 5 June 2019 the respondent’s pain gradually increased.  An MRI scan of his lumbar spine was done on 17 June 2019.  Radiologist Dr Poh Kepheswaran reported on that scan, commenting that it revealed spondylotic changes in the lower lumbar spine with impingement of the left L5 nerve root.  Dr Kepheswaran also commented that a CT guided left L5 nerve block and epidural blocks at the L4/5 may benefit the respondent.
9.	The respondent again came under the care of Dr Hsu who referred him for CT guided left L4/5 transforaminal perineural steroid injection, which was done on 11 July 2019.  That only provided fleeting relief for the respondent.  Following Dr Hsu reviewing the respondent on 
17 July 2019, Dr Hsu wrote to the respondent’s general practitioner who advised that the respondent’s symptoms are originating from his L4/5 level and that the respondent’s “surgical option would be an L4/5 discectomy or L4/5 decompression and fusion”.  Dr Hsu also advised that a discectomy alone would unlikely address the respondent’s buttock and thigh pain.
10.	Dr Hsu again reviewed the respondent on 3 October 2019, and on 16 October 2019 he wrote again to the respondent’s general practitioner to report on that consultation.  His letter contained the following:
“He has had approval for a lumbar discectomy surgery at L4-5 but not approval for lumbar fusion surgery at L4-5. Considering this is a recurrent disc herniation, the risk of recurrence of the herniation is quite high, up to 20%.
It is likely that he will require a fusion surgery at this level and while it would be reasonable to proceed with a lumbar discectomy alone, it would be likely beneficial for him to also obtain approval for a fusion surgery as well.”
11.	Dr Hsu’s reference in that correspondence to “approval” is an obvious reference to the respondent’s workers compensation insurer agreeing to pay the respondent compensation for the cost he incurred in having a lumbar discectomy but not pay him compensation for the cost for having lumbar fusion surgery at L4/5.  Notwithstanding that, in November 2019 
Dr Hsu conducted further surgery when he performed an L4/5 decompression and fusion.  
12.	In 2020 the respondent experienced pain in his back and burning pain in the soles of his feet.  Dr Hsu administered an epidural injection at L5/S1 which did not improve the respondent’s symptoms.  Dr Hsu recommended the respondent have a discectomy and fusion at L5/S1.  It is apparent from the material before the Appeal Panel that the respondent sought the appellant’s insurer cover the cost of that but the insurer denied it was liable to do so.  Following the respondent initiating proceedings in the Personal Injury Commission (Commission) the respondent ultimately agreed to meet the cost of the surgery.  
13.	Around the start of October 2021 Dr Hsu undertook two surgeries, in the first of which he performed an L5/S1 interior interbody fusion followed three days later by an L4 to S1 posterior fusion.  The respondent’s symptoms gradually improved following that surgery.
14.	On 15 March 2023 the respondent claimed compensation from the appellant for permanent impairment from his injury of 5 June 2019.  He relied on reports that orthopaedic surgeon 
Dr David Millons had prepared dated 22 February 2023 and 8 March 2023.  In his report of 
8 March 2023 Dr Millons advised he assessed the degree of the respondent’s permanent impairment from his injury is 24% whole person impairment (WPI).  He detailed that this was comprised of 23% WPI relating to the respondent’s lumbar spine less a deduction of 10% for a pre-existing condition (which rounded to 22% upon that deduction being made) plus 2% WPI for scarring.
15.	On 8 September 2023 the appellant’s solicitors wrote to the respondent’s solicitors advising them that the appellant had instructed them to offer to settle the respondent’s claim for compensation for permanent impairment from his injury by paying the respondent compensation for 20% WPI.  The appellant’s solicitors provided with their correspondent a copy of a report of orthopaedic surgeon Dr David Hale dated 21 July 2023, who had examined the respondent on 10 July 2023 at the request of the appellant’s solicitors, and who advised in his report that he assessed the degree of the respondent’s permanent impairment from his injury is 20% WPI.  Dr Hale detailed in his report that he assessed the overall permanent impairment the respondent had relating to his lumbar spine was 24% WPI but he made a deduction of two-tenths for a pre-existing condition such that he assessed the degree of the respondent’s permanent impairment from his injury relating to his lumbar spine was 19% WPI.  To that he added 1% for scarring.
16.	The issue the appellant has raised in its appeal against the medical assessment relates to the deduction the Medical Assessor made under s 323(1) of the 1998 Act for the proportion of the respondent’s permanent impairment that is due to a pre-existing injury.  The appellant contends that the Medical Assessor should have made the same deduction that Dr Hale made.  Dr Hale provided these reasons in his report for the deduction of 2/10th he made:
“Pre-existing condition is regarded as significant and at least 2/10th according to pre-existing condition 1.28, p6, NSW WC Guidelines, 4th Edition.
This is on the basis of Dr Hsu’s comments noted in ‘Opinion’.
(Without the previous surgery at L4/5 it is likely that only a discectomy would have been required and in this circumstance, he would have been assessed as DRE Category iii, Table 15-3, p384, AMA 5, i.e., 11% WPI).”
17.	The comments of Dr Hsu, to which Dr Hale made reference, are those that the Appeal Panel extracted above at [10].  
18.	It is apparent the respondent did not accept the appellant’s offer since on 21 December 2023 his solicitors lodged with the Commission an Application to Resolve a Dispute seeking the Commission determine his claim for the appellant to pay him compensation for permanent impairment from his injury.
19.	The matter was referred to the Medical Assessor on 8 April 2024 who examined the respondent on 11 April 2024 so as to assess the medical disputes between the parties relating to the respondent’s degree of permanent impairment from his injury.
20.	In the MAC the Medical Assessor issued on 22 April 2024 he certified he assessed the degree of the respondent’s permanent impairment from his injury was 22% WPI.  That comprised 24% WPI less a deduction of one-tenth he made under s 323(1) of the 1998 Act for a proportion of the respondent’s permanent impairment that he considered was due to a pre-existing condition.  The Medical Assessor certified that he assessed the respondent had 0% WPI relating to scarring from surgery.  
21.	The Medical Assessor’s assessment that the respondent’s overall impairment relating to his lumbar spine is 24% WPI and the Medical Assessor’s assessment that the respondent has 0% WPI relating to scarring is not contested in the appellant’s appeal.  As mentioned above, the issue that the appellant raises in its appeal relates to the deduction the Medical Assessor made under s 323(1) of the 1998 Act.  With respect to that matter the Medical Assessor noted that the respondent had undergone a discectomy at L4/5 in 2015 from which the Medical Assessor said the respondent had made “a full recovery until the injury in 2019”.  The Medical Assessor also noted that Dr Millons in his assessment of the respondent’s permanent impairment from his injury had “made one-tenth deduction for the L4/5 surgery in 2015”.  The Medical Assessor said he agreed with Dr Millons’ approach.  
22.	The Medical Assessor also noted the deduction Dr Hale made and commented that Dr Hale had noted that he could deduct 11% (DRE category 3) for the previous surgery the respondent had in 2015 but chose to use the Guidelines and deducted two-tenths instead.  He subsequently also repeated his view that Dr Hale determined “not to deduct DRE3”.  The Medical Assessor then indicated that he considered the extent of what the deduction should be is difficult or costly to determine and because of that he determined the deduction is one-tenth, which he said “is a method used by myself and Dr Millons”.
PRELIMINARY REVIEW
23.	The Appeal Panel conducted a preliminary review of the original medical assessment in the absence of the parties and in accordance with the Procedural Direction PIC7.
24.	As a result of that preliminary review, the Appeal Panel determined that it was not necessary for the respondent to undergo a further medical examination. This is because the Appeal Panel came to the view that the appellant had not established any of the grounds for appeal on which it relied, and consequently the Appeal Panel had no reason or power to examine the respondent.
EVIDENCE
25.	The Appeal Panel has before it all the documents that were sent to the Medical Assessor for the original medical assessment and has taken them into account in making this determination.  
SUBMISSIONS 
26.	Both parties made written submissions. They are not repeated in full, but have been considered by the Appeal Panel. 
27.	In summary, the appellant submitted that the Medical Assessor misunderstood the reasoning of Dr Hale for making a deduction of two-tenths under s 323(1) of the 1998 Act.  The appellant submitted that Dr Hale’s reasoning was consistent with the opinion of Dr Hsu as advised in Dr Hsu’s report of 16 October 2019, that is that the respondent’s pre-existing condition made it likely that he would suffer a recurrent disc herniation.  The appellant submitted that had the respondent not suffered a recurrent herniation he would not have needed fusion surgery.  The appellant submitted that the previous condition the respondent had and the surgery he had in 2015 to treat that condition “was so significant, that this led to the worker needing to undergo fusion surgery in 2019”.  The appellant submitted that it was on that basis that Dr Hale considered a two-tenth deduction pursuant to s 323(1) of the 1998 Act was warranted.
28.	The appellant submitted that Dr Hale’s reasoning was reasonable.  The appellant submitted that to assume the deduction is one-tenth pursuant to s 323(2) “is erroneous and diminishes the significance of the 2015 injury and surgery”.  The respondent submitted that “a more significant deduction of s 323 of the 1998 Act should have been made”.  
29.	In reply, the respondent submitted that Dr Hsu in his report of 16 October 2019 made a speculative comment regarding the connection between his pre-existing condition and the disc herniation he suffered following his injury in 2019 in that Dr Hsu said the risk of a recurrent disc herniation is 20%.  The respondent submitted that Dr Hale adopted Dr Hsu’s speculative comment when considering what deduction should be made for his pre-existing condition and applied the figure of 20%, being the degree of risk that Dr Hsu considered his earlier condition posed to the recurrence of a disc herniation.  The respondent submitted that is a flawed method.  The respondent submitted that Dr Hale did not address the relevant question of how his pre-existing condition actually contributes to his current level of impairment and that Dr Hale did not explain the basis and extent of that contribution.
30.	The respondent submitted that there was no evidence available to the Medical Assessor that would enable a precise formulation of the contribution of his pre-existing condition to his current level of impairment and the Medical Assessor was correct to assume in accordance with s 323(2) of the 1998 Act that the deductible proportion is 10%.
FINDINGS AND REASONS 
31.	The procedures on appeal are contained in s 328 of the 1998 Act. The appeal is to be by way of review of the original medical assessment but the review is limited to the grounds of appeal on which the appeal is made. 
32.	In Campbelltown City Council v Vegan [2006] NSWCA 284 the Court of Appeal held that the Appeal Panel is obliged to give reasons.  
33.	The fact that prior to suffering his injury on 5 June 2019, the respondent’s disc at L4/5 had herniated, and this resulted in his having a discectomy in July 2015, which in turn made him susceptible or pre-disposed him to suffering a recurrent herniation is not relevant, of itself, to whether a deduction is to be made under s 323(1) of the 1998 Act for a pre-existing condition.  What s 323(1) of the 1998 Act requires is a consideration of whether a pre-existing condition contributes causally to the actual level of impairment the respondent suffered as a consequence of his injury on 5 June 2019.  That is, what it requires is a consideration of whether a condition a worker has prior to his or her suffering injury contributes to the level of impairment the worker has as a result of an injury, as at the date that is assessed by a Medical Assessor.
34.	In this case, the respondent’s injury on 5 June 2019 resulted in a further herniation of his disc at the L4/5.  In all likelihood, his earlier herniation of that disc was a factor in the occurrence of his injury on 5 June 2019.  The injury he suffered on 5 June 2019, being the further herniation of his disc, was treated by surgery in the form of an interior discectomy and fusion at L5/S1 followed shortly thereafter by an instrumented posterior fusion at L4/S1.  That surgery was to treat the injury the respondent suffered on 5 June 2019, not his earlier herniation.  
35.	The Medical Assessor correctly assessed the respondent had 24% WPI relating to his lumbar spine, and as already stated neither party has controversy with that.  Further, the respondent did have a pre-existing condition of his lumbar spine at the time he suffered injury on 5 June 2019, which was likely to have caused some degeneration at the L4/5 level, and as said earlier it is likely this degeneration played a part in the occurrence of the respondent’s injury on 5 June 2019.  But to be clear, there is no evidence to substantiate that his disc was herniated at that level immediately preceding his suffering injury, noting that an earlier herniation he had had been treated successfully by a discectomy and that is evident from the respondent having no issues with his lumbar spine after that and being able to undertake arduous work until his injury of 5 June 2019.  The incident on 5 June 2019 resulted in his disc herniating again.
36.	Neither party took issue with the Medical Assessor’s finding that the respondent had a pre-existing condition and the Appeal Panel in any event considers it is the correct finding.  Neither party either took issue that the pre-existing condition contributes a proportion of the respondent’s permanent impairment from his injury, and again the Appeal Panel in any event considers that is the correct conclusion.
37.	What is at issue in this appeal is whether the Medical Assessor was correct to assume in accordance with s 323(2) of the 1998 Act that the proportion that the pre-existing condition contributes to the respondent’s permanent impairment from his injury to his lumbar spine, that injury being a recurrence of a disc herniation at L4/5, is 10%.
38.	Consistent with what the respondent has submitted, it is difficult to determine to what extent exactly the pre-existing degeneration the respondent had in his lumbar spine contributes to the permanent impairment that resulted as a consequence of the recurrence of his disc herniation at L4/5.  Consequently, the Medical Assessor was required to assume that the proportion that pre-existing degeneration contributes to his permanent impairment from his injury is 10%, unless making that assumption was at odds with the evidence.  
39.	The Appeal Panel considers the assumption the Medical Assessor made was not at odds with the evidence and consequently, the Medical Assessor made no error in making that assumption. 
40.	The relevant evidence is that whilst the respondent’s prior disc herniation was a factor in the occurrence of his injury on 5 June 2019, the respondent had recovered from his earlier disc herniation through treatment in the form of a discectomy such that he was able to perform arduous work for several years until he suffered injury on 5 June 2019 when his disc herniated again at the L4/5 level.  Without the incident occurring on 5 June 2019 it is unknown whether his disc at that level would again have herniated and whether he would have needed the surgery he had or have suffered the impairment that flowed from his injury on 5 June 2019.
41.	The Medical Assessor was not required to adopt either the reasoning of Dr Hale relating to the deduction he made or the deduction Dr Hale made based on his reasoning.  The Medical Assessor’s reasons for the deduction he made are correct, and so consequently is the deduction he made.
42.	For these reasons, the Appeal Panel has determined that the MAC issued on 22 April 2024 should be confirmed.