Facing a situation where your insurance company recommends a treatment you disagree with can be daunting. The insurer might even threaten to cut off your benefits if you don’t comply. Do they have the right to do this? When can you refuse and still retain your benefits? Let’s explore the rules and factors at play in such scenarios.
Understanding the duty to mitigate
The Duty to Mitigate is a common law principle that applies to various situations, including insurance claims. It requires you to take reasonable steps to avoid or reduce losses. In the context of health insurance, this means following reasonable treatment recommendations.
If you fail to mitigate your losses by refusing reasonable treatment, the insurance company may argue they should not be responsible for any resulting losses. Essentially, you’re expected to cooperate with recommended treatments to ensure your recovery and minimize costs.
Insurance policy clauses
Insurance policies often have specific clauses outlining the expectations and obligations of the policyholder regarding medical treatments. A typical clause might state that you must follow recommended treatments to continue receiving benefits. Understanding the precise wording of your policy is crucial, as it can vary between insurers.
Scenario: Disagreeing with treatment recommendations
Imagine your insurance company asking you to undergo a treatment you disagree with. Your doctor supports your decision to decline the treatment. What are your rights and responsibilities in this situation?
Legal framework
With long term disability, your responsibility to follow treatment recommendations is governed by the duty to mitigate (common law) and the insurance contract.
- Duty to mitigate: This requires you to take steps to avoid losses by following reasonable treatment recommendations. The trier of fact (e.g., a judge) will decide if you have been reasonable in refusing the medical recommendation. Factors considered include the degree of risk in undergoing the treatment, the gravity of the consequences of refusing it, and the potential benefits derived from it. If you follow any one of several recommended treatments, you cannot be said to have acted unreasonably.
- Onus of proof: While you have the duty to mitigate, the burden is on the defendant (the insurance company) to demonstrate that you failed to mitigate. The defendant must prove on a balance of probabilities that you acted unreasonably and that your losses would have been reduced or eliminated had you acted reasonably.
Case law insights
In Bryon v. Larson, the Alberta Court of Appeal stated that a defendant cannot be held liable for damages which the plaintiff could have reasonably avoided. This principle was reinforced in Janiak v. Ippolito, where the burden shifts to the defendant to prove that the plaintiff could and should have mitigated their losses.
Determining reasonable treatment
Judges consider several factors to determine if a treatment recommendation is reasonable:
1. Doctor’s Opinion: Whether your doctor and other physicians agree on the appropriateness of the treatment.
2. Prognosis Agreement: Whether there is agreement among doctors on your prognosis following the treatment.
3. Risk-Benefit Advice: Whether you have been advised about the nature and risks of the treatment and whether there was a recommendation to undergo it.
4. Alternative Treatments: Whether you have followed any alternative appropriate treatments.
5. Degree of Risk: The inherent risks associated with the treatment.
6. Consequences of Refusal: The gravity of the consequences of refusing the treatment.
7. Potential Benefits: The benefits you might derive from the treatment.
8. Decision-Making Capability: Whether you suffer from a pre-existing condition that renders you incapable of making a choice.
Contractual obligations
Insurance policies often have clauses that compel the insured to undertake treatment recommended by the insurance company. These clauses create contractual obligations separate from the duty to mitigate. For example, a policy might require you to participate in a rehabilitation program approved by the insurer. If you breach these responsibilities, the insurer may withhold or terminate benefits.
Leading cases
The leading case on reasonable treatment refusal is Janiak v. Ippolito, where the Supreme Court of Canada provided a framework for assessing reasonableness. In Sandler v. Sun Life, a dentist refused cataract surgery due to the risks involved. The court found the refusal unreasonable because the surgery was deemed necessary for the insured to continue working, and the policy required following reasonable treatment recommendations.
Final thoughts on refusing medical treatment
Refusing medical recommendations from your insurance company is a complex issue with significant implications for your benefits. Understanding the duty to mitigate and the factors that judges consider can help you make informed decisions. Always involve your healthcare provider and consider seeking legal counsel to navigate these challenging situations effectively.
Want to learn more about when you can refuse medical recommendations from your insurer? We covered this topic on our weekly webinar, the Disability Claims Answers Show. You can watch the webinar replay by signing up for our FREE Insider Basic Membership; the replay was posted on August 10, 2023, titled, When Can You Refuse Treatment and Rehabilitation Recommendations From Your Insurer?
Related reading: Can Long-Term Disability Insurers Reject Alternative or Holistic Treatments?
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References
1. Janiak v. Ippolito** [1985] 1 SCR.
2. Bryon v. Larson** 2020 ONCA 330.
3. Sandler v. Sun Life** [2003] BCJ 188 (CA).