Karalis v Venueslive Management Services (NSW) Pty Ltd

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Karalis v Venueslive Management Services (NSW) Pty Ltd [2025] NSWPIC 106
APPLICANT:	Joanna Karalis
RESPONDENT:	Venueslive Management Services (NSW) Pty Ltd
MEMBER:	Rachel Homan
DATE OF DECISION:	24 March 2025
CATCHWORDS:	WORKERS COMPENSATION - Workers Compensation Act 1987; claim pursuant to section 60 for costs of and incidental to lumbar surgery; injury accepted; whether the surgical procedure proposed is “reasonably necessary” medical treatment; where prior surgery at the same level failed to produce lasting benefit; whether lack of evidence in relation to co-morbid conditions prevented applicant from discharging onus; availability of alternative treatments; Held – the proposed surgery is reasonably necessary as a result of injury; respondent to pay costs of and incidental to the surgery in accordance with section 60.
DETERMINATIONS MADE:	The Commission determines: 1. The L5-S1 transforaminal lumbar interbody fusion proposed by Dr Ashish Diwan is reasonably necessary as a result of the injury on 10 June 2023. 2. The respondent to pay the costs of and incidental to the proposed L5-S1 transforaminal lumbar interbody fusion in accordance with s 60 of the Workers Compensation Act 1987. A brief statement is attached setting out the Commission’s reasons for the determination.

STATEMENT OF REASONS

BACKGROUND

Ms Joanna Karalis (the applicant) was employed by Venueslive Management Services (NSW) Pty Ltd (the respondent) as a bar attendant. On 10 June 2023, the applicant was in the course of her employment, restocking a mini fridge, when she became aware of a sharp pain in her lower back.
Liability to pay compensation in respect of the injury to the applicant’s lumbar spine was accepted by the respondent’s insurer.
On 21 November 2023, the applicant underwent an L5- S1 decompression surgery performed by Dr Ashish Diwan, paid for by the insurer.
On 7 August 2024, Dr Diwan requested approval for the applicant to undergo a transforaminal lumbar interbody fusion at L5-S1. Liability to pay for the further surgery was disputed in a notice issued pursuant to s 78 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) on 13 September 2024.
The applicant sought internal review of that decision on 17 October 2024. On 4 November 2024, the decision to dispute liability for the proposed surgery was maintained in a further notice issued pursuant to s 78 of the 1998 Act.
The present proceedings were commenced by lodgement of an Application to Resolve a Dispute (ARD) in the Personal Injury Commission (Commission) on 9 December 2024. The applicant sought weekly compensation as well as compensation pursuant to s 60 of the Workers Compensation Act 1987 (the 1987 Act) for the costs of and incidental to the proposed surgery. The claim for weekly compensation was later discontinued.

PROCEDURE BEFORE THE PERSONAL INJURY COMMISSION

The parties appeared before the Commission for conciliation conference and arbitration hearing on 20 March 2025. The proceedings were conducted on the Microsoft Teams platform. The applicant was represented by Mr Luke Morgan of counsel, instructed by Ms Giulia Colusso. The respondent was represented by Mr Ross Hanrahan of counsel, instructed by Ms Laura Risti. A representative from the insurer was present during the conciliation phase.
During the conciliation, the applicant withdrew her claim for weekly compensation as well as any reliance on consequential conditions resulting from her lumbar injury. The respondent confirmed that the causal relationship between the proposed surgery was not in dispute. A dispute as to whether the surgery was “reasonably necessary” remained.
I am satisfied that the parties to the dispute understand the nature of the application and the legal implications of any assertion made in the information supplied. I have used my best endeavours in attempting to bring the parties to the dispute to a settlement acceptable to all of them. I am satisfied that the parties have had sufficient opportunity to explore settlement and that they have been unable to reach an agreed resolution of the dispute.

ISSUES FOR DETERMINATION

The parties agree that the following issue remains in dispute:
(a) whether the L5-S1 transforaminal lumbar interbody fusion surgery proposed by Dr Diwan is “reasonably necessary” for the purposes of s 60 of the 1987 Act.

EVIDENCE

Documentary evidence

The following documents were in evidence before the Commission and considered in making this determination:
(a)    Application to Resolve a Dispute and attached documents;
(b)    Reply an attached documents;
(c)    documents attached to an Application to Lodge Additional Documents lodged by the applicant on 31 January 2025;
(d)    documents attached to an Application to Lodge Additional Documents lodged by the respondent on 17 March 2025; and
(e)    supplementary statement of the applicant, dated 14 March 2025.
Neither party applied to adduce oral evidence or cross-examine any witness.

Applicant’s evidence

The applicant’s evidence is set out in written statements made by her on 30 April 2024 and 14 March 2025.
In her first statement, the applicant described the injury and noted that she was aware of immediate sharp pain in her lower back and could not feel her legs. An ambulance was called and the applicant was assessed by paramedics. The applicant also became aware of severe pain in her right hip and pain radiating down both of her legs.
The applicant’s injury was initially managed conservatively under the care of her general practitioner. The applicant underwent physiotherapy and continued to work light duties but was experiencing a great deal of pain.
The applicant was eventually referred to an orthopaedic surgeon, Dr Diwan, who ordered MRI investigations. The applicant underwent two CT guided facet block injections at L5-S1. When these treatments failed to alleviate the applicant’s symptoms, surgery was recommended.
On 21 November 2023, the applicant underwent a lumbar spine surgery. The applicant said she was initially pleased with the outcome of the procedure and was making progress. Nonetheless the applicant continued to have severe and, at times, debilitating pain in her lower back. That pain had become substantially worse.
Due to pain in the applicant’s hip, she was unable to sit comfortably for periods of more than 10 minutes. The applicant experienced reduced mobility and at times struggled to walk. The applicant’s sleep was significantly disrupted. The applicant also continued to experience pain radiating down her leg, particularly affecting her right knee.
The applicant said she was taking a number of medications to manage her ongoing symptoms, however, her pain remained severe.
In her supplementary statement, the applicant said she continued to consult with Dr Diwan and he remained of the view that a fusion surgery at L5-S1 was appropriate. The symptoms at the applicant’s hip and been considered by her medical team and their view that the surgery was appropriate had not changed.
The applicant said her quality of life was very poor. The applicant was in significant pain and experienced disturbed sleep. The applicant was restricted in her ability to sit or stand for any period of time. Ongoing tightness and soreness in the applicant’s back impacted her ability to mobilise and perform tasks around the home. The applicant was restricted in her capacity to perform activities outside the home such as shopping.
The applicant said she was keen to proceed with surgery.

Dr Diwan

The applicant was seen by spine and scoliosis surgeon, Dr Ashish Diwan on 11 September 2023 at the request of her general practitioner (GP). Dr Diwan noted the onset of lumbosacral, right trochanteric and right groin pain on 10 June 2023.
Dr Diwan recorded that the applicant had undergone an interlaminar epidural steroid injection at L4-5. An MRI scan showed facet osteoarthritis and a small contained herniation at L5-S1. The applicant’s symptoms were said to be suggestive of an irritated L5-S1 facet. Dr Diwan wished to rule out any listhesis by obtaining standing X-rays. A L3 to S1 joint SPECT along with technetium bone scan were recommended to gain a better understanding of the pain generator.
On 15 September 2023, Dr Diwan reported that the standing X-rays showed subtle deviation at L4-5 and minor anterior listhesis at L5-S1 was reported but not perceptible. The technetium bone scan was more revealing and showed uptake at the L5-S1 facets bilaterally. Dr Diwan sought approval to perform a right L5-S1 facet block.
On 15 November 2023, the applicant reported significant distress with right leg pain. The applicant had not responded to two lots of injections, was experiencing suicidal ideation and was worried about her body weight. Dr Diwan noted his findings on examination and reviewed the MRI and X-ray investigations. Dr Diwan said it was reasonable to consider
L5-S1 micro decompression and discectomy.
Dr Diwan also referred the applicant to Megumi Health for a comprehensive pain management plan in respect of her L5-S1 disc herniation with right-sided radicular symptoms.
On 20 December 2023, Dr Diwan noted that four weeks after the L5-S1 decompression, the applicant was doing reasonably well. The applicant had some right groin pain and occasional tingling and numbness. Dr Diwan said he had instructed the applicant’s therapist to advance her strengthening exercises.
On 19 February 2024, the applicant reported pain in the mid lumbar region and some right hip pain. Dr Diwan referred the applicant for MRI investigations.
On 18 March 2024, Dr Diwan reported that the MRI scans showed minimal oedema around the S1 nerve root consistent with postsurgical changes. There was no compression or anything of surgical significance. An MRI of the right hip showed early chondral changes, which Dr Diwan thought should be followed up with a hip surgeon.
On 20 May 2024, the applicant reported right groin and right upper thigh pain. Based on the MRI results, Dr Diwan considered the problem was mostly in the hip and not the spine.
Dr Diwan again recommended review with a specialist hip surgeon. Dr Diwan recommended that the applicant’s pain management be adjusted. The applicant was noted to be seeing a clinical psychologist.
On 7 August 2024 the applicant reported continuing right radicular pain. Dr Diwan reported:
“Terminal SLR was positive. I reviewed all the investigations including the most recent MRI scan. In the MRI scan there was a suggestion of a subtle anterior listhesis at L5-S1 with significant facetal osteoarthrosis. I hence reviewed the technician bone scan from September 2023 which shows increase in uptake bilateral L5- S1 facet joints.
There may be a good case that given her persistent significant ongoing back pain she be considered for a L5-S1 minimally invasive translumbar interbody fusion. She is keen to proceed. I have suggested that she get a standing x-ray performed.”
Dr Diwan responded to a series of questions from the insurer in a report of the same date. Asked how the surgery was reasonably necessary for the work injury, Dr Diwan responded that all relevant non-operative treatment modalities had been tried and failed to provide lasting benefit. These included steroid injections, pharmacotherapeutic pain management, psychological pain management, physiotherapy and operative treatment in the form of the
L5-S1 spinal decompression.
Dr Diwan said the main indication for the fusion was the severe facet osteoarthritis with subtle listhesis at L5-S1. Dr Diwan said the surgery had the capacity to relieve the applicant’s symptoms by stabilising the spine and removing the inflammatory aggravation.
Dr Diwan prepared a report for the applicant’s solicitors on 6 December 2024. The report provided a history of the injury and the treatment to date that was consistent with Dr Diwan’s other reports. Dr Diwan recorded:
“By 19 February 2024 her hip pain and right lumbosacral pain had persisted and worsened. Her hip MRI scan showed only minor osteochondral changes and I suggested a hip surgeon review. By 20 May 2024 I was still of the opinion that the hip was the major issue. By 7 August 2024 her symptoms now appeared to be radicular in nature and the matter related to her hip was resolved, and my conclusion was that her symptoms are now arising from the previously observed L5-S1 slip consequent to the facet osteoarthrosis. Having failed all non-operative care, I suggested she consider an L5-S1 minimally invasive translumbar interbody fusion.”
Dr Diwan was asked to comment on the opinions expressed by the respondent’s medicolegal expert, Dr Wallace:
“Dr Wallace opines that irrespective of conservative or surgical treatment her treatment outcome will be guarded. Majority of surgical clinicians will agree with that. However, given that she has tried a whole range of nonoperative treatment options, that she has a definite surgical target, reasonable time has elapsed and it is the same segment that was previously treated, it will be a reasonably necessary option to proceed with a surgical stabilisation. While his opinion is respected, there is a lack of reasoning provided as to why he opines so. The reality remains that L5-S1 is the target level, has instability and patient has exhausted all non-operative measures, hence surgery is a reasonably necessary option.”
Dr Diwan estimated that the surgery had a 70% chance of resolving the applicant’s symptoms. Asked to comment on the appropriateness of the treatment, Dr Diwan stated:
“Spinal fusion surgery should be avoided as much as possible, however if there is evidence of any subtle listhesis, along with a significant amount of arthritis of the facet joints which are not responding to nonoperative care this may be a reasonably necessary option.
In Joanna's case the decompression surgery has proven futile and as the exacerbated facet facetal joints continue to cause pain it may be a reasonable option for her to consider a L5-S1 fusion.
The alternative treatments have been tried, including injections, pain medication, exercise, retraining rehabilitation. The alternative of spinal cord stimulators is no longer considered reasonable.
The effectiveness of spinal fusion in somebody who is on worker's compensation claim, and if her return to preinjury duties is considered as her success, the chances that the person may return to preinjury duties is only 50%. However 70 to 75% of patients do improve in the pain which contributes to the improvement in quality of life.
Details of the cost of the treatment will be separately provided by my office.
Generally, surgical experts in the field of spinal surgery accept that the fusion operation for subtle anterior listhesis and facet arthritis is a reasonably necessary treatment, when all relevant non-operative treatments for the individual patient have been tried and failed to provide the benefits needed.”

Pain management

The applicant was seen for pain management review by Dr Tejas Kanhere at Megumi Health on 5 December 2023. Dr Kanhere noted the lumbar surgery performed two weeks earlier. The applicant’s current medications were listed. A significant past mental health history and previous rheumatoid arthritis diagnosis were also recorded.
The applicant was noted to have neuropathic pain affecting the right L5 dermatome.
Dr Kanhere recommended introducing an anti-neuropathic agent, sodium valproate, which was likely to be helpful and compatible with the medications used to treat the applicant’s PTSD/bipolar disorder. It was suggested that the applicant be reviewed by a rheumatologist when she had recovered from her spinal surgery.
The applicant was subsequently seen by Dr Stephen Gibson at the same practice. Dr Gibson noted that the trial of sodium valproate had not reduced the applicant’s pain although her bipolar symptoms were somewhat improved. The applicant’s prescription of pregabalin was increased to address her lower back and right leg radicular pain.
On 19 February 2024, Dr Gibson noted that there was no improvement in the applicant’s right leg radiculopathy with the increased dose of pregabalin. The applicant continued to describe neuropathic pain in approximately the S1 dermatome. Dr Giblin suggested further MRI imaging.
On 5 March 2024, Dr Gibson noted that the MRI revealed perineural fibrosis of the right
S1 nerve root which was a common postsurgical inflammatory response. Dr Gibson recommended the applicant continue trialling anti-neuropathic medications.
On 16 April 2024, Dr Gibson recorded that the applicant’s right leg radicular pain was continuing without a great deal of improvement despite higher doses of anti-neuropathic medication. The applicant’s sleep remained poor. A formal request was made for the applicant to see a pain clinical psychologist.
On 27 August 2024, it was noted that the applicant was using six tablets of Endone per day without any additional analgesic benefit. The applicant was finding her current medication mix to be quite sedating and interfering significantly with her daytime cognition. Dr Gibson said the applicant’s pain management options were fairly few in terms of what had not already been trialled.
Dr Gibson noted that the applicant had enquired as to whether medicinal cannabis would have any potential benefit. Dr Gibson indicated that the current best medical evidence was that the analgesic effect was small. If the applicant were willing to stop using the oxycodone, a trial of medicinal cannabis would be reasonable. The applicant was given a prescription for a THC/CBD cannabis product with a review planned in four weeks’ time.

Dr Rae

The applicant was seen by hip specialist, Dr Hamish Rae in relation to her persisting right hip and groin pain on 2 August 2024.
Dr Rae noted the applicant’s complex background including past opiate addiction. The applicant was noted to have a medical background of rheumatoid arthritis diagnosed at approximately age 25 for which the applicant was treated with methotrexate. The applicant had intermittent pain predominantly in her hands and knees. The applicant was also noted to have complex mental health history for which she was seeing a psychologist weekly and a psychiatrist every three weeks. The applicant was taking a number of psychotropic and antidepressant medications.
Dr Rae noted the surgery performed by Dr Diwan on 21 November 2023. The applicant reported a few weeks of improved symptoms which then deteriorated.
Dr Rae reviewed an MRI scan of the applicant’s right hip which revealed moderate arthritis and grade three chondral loss with mild synovitis. There was an undisplaced tear of the anterosuperior labrum, some hip abductor tendinopathy and evidence of moderate trochanteric bursitis.
Dr Rae expressed the view that the applicant’s hip appeared to be the current, predominant cause of pain. Dr Rae also considered it worthwhile investigating to see if there was any evidence of active rheumatoid arthritis, although the presence of small osteophytes in the hip joint and no effusion on the MRI performed in February 2024 suggested that this was mainly an osteoarthritic process exacerbated by labral tear rather than inflammatory arthritis.
Dr Rae recommended further investigations and blood tests following which he proposed to discuss the applicant’s potential treatment options. Dr Rae noted that the applicant was awaiting further review with Dr Diwan.

Assoc Prof Courtenay

The applicant relies on a medicolegal report prepared by orthopaedic surgeon, Assoc Prof Brett Courtenay on 3 October 2024.
Assoc Prof Courtenay took a history of injury that was consistent with the applicant’s statement and noted the surgery performed on 21 November 2023. Assoc Prof Courtenay recorded that approximately four weeks after the surgery, the applicant was using a stick vacuum cleaner, for no more than 10 minutes, when she had an acute flare of her back problems.

AssocProf Courtenay noted a past medical history of rheumatoid arthritis, treated initially with methotrexate. This had settled down although the applicant described some residual problems with her fingers. The applicant had long history of mental health illnesses and was suffering from quite severe depression.
The applicant was taking multiple antidepressant medications as well as painkillers including oxycodone, Valium and Endone. The applicant had was due to see a doctor with respect to using CBD oil in the near future.
The applicant described having trouble driving, limitations on walking and pain, particularly in her right groin, buttock and leg.
Assoc Prof Courtenay observed that Dr Diwan had recommended an L5-S1 fusion.
Assoc Prof Courtenay performed a physical examination and considered the radiological investigations. Assoc Prof Courtenay considered that the history was strongly suggestive of compression of the right S1 nerve root. This had been treated surgically but following a very minor incident there was a further flare of pain.
Assoc Prof Courtenay commented on the evidence of right hip pathology and said there was also a possibility that the applicant’s underlying rheumatoid arthritis had been flared as a result of the stress, surgery and the worsening of the applicant’s general depressive state. Assoc Prof Courtenay said this needed to be checked with the applicant’s treating rheumatologist.
AssocProf Courtenay was asked whether the surgery recommended by Dr Diwan was required as a result of the workplace injury. Assoc Prof Courtenay said this was an appropriate procedure, commenting:
“I do believe that the treatment is appropriate. At this stage, there is the question about the hip. The cost of the treatment is unclear depending on what is actually required, and the treatment is certainly going to be accepted by medical experts. It really a difficulty of working out what other options can be available and the rheumatoid needs to be checked.”

Dr Wallace

The respondent relies on medicolegal reports prepared by orthopaedic surgeon,
Dr Raymond Wallace, dated 14 October 2024 and 6 March 2025.
In his first report, Dr Wallace recorded a consistent history of the injury and subsequent treatment under the care of the applicant’s general practitioner through physiotherapy and analgesic medication.
It was noted that the applicant had been referred to Dr Diwan and had undergone an epidural steroid injection and right facet joint injection at L5-S1. Dr Wallace observed that the applicant had undergone right L5-S1 microdiscectomy on 21 November 2023, followed by a course of physiotherapy in the post-operative period. On 7 August 2024, Dr Diwan had recommended revision surgery in the form of L5-S1 fusion.
Dr Wallace noted that the applicant was currently attending physiotherapy twice a week and using medications including oxycodone, Endone and Topamax.
The applicant’s symptoms included constant aching pain in the lumbar spine in the region of the L5 spinous process radiating to the right groin and lateral aspect of the right leg to the level of the foot. The pain was made worse with prolonged sitting, standing or walking and relieved by lying on the left side, stretching or Pilates. The applicant reported paraesthesia or numbness globally intermittently about the right leg to the level of the foot as well as weakness at the right leg and stiffness of the lumbar spine.
Dr Wallace said the applicant would benefit from weekly visits to physiotherapy in conjunction with a home exercise program and the use of Panadol. Dr Wallace recommended the applicant ceased her current use of narcotic analgesic medication.
With regard to surgery, Dr Wallace gave the opinion:
“Ms Karalis would not benefit from further operative intervention at the lumbar spine in the form of lumbar spinal fusion at the L5/S1 level. Ms Karalis' previous surgical intervention in the form of right L5/S1 microdiscectomy in November 2023 failed to relieve her lumbar spine or right lower limb symptoms.
On recent MRI investigation on 31 July 2024, she had evidence of enhanced granulation tissue at the right lateral aspect of the epidural space surrounding the right S1 nerve root which may be causing mild neuritis.
Her current right lower limb symptoms are due to post-operative granulation tissue surrounding the right S1 nerve root. It is highly unlikely that further surgical intervention in the form of fusion at the L5/S1 level will lead to a durable reduction in the level of symptoms or increase in function at her lumbar spine.
The proposed revision surgery would not address the complications of possible perineural scarring developing around her right S1 nerve root and most likely increase the likelihood of this complication. The proposed surgical intervention of L5/S1 fusion is not necessary for treatment of her work-related lumbar spinal condition.”
Dr Wallace referred to a study that indicated that the results of operative intervention in the form of lumbar spinal fusion in active workers compensation cases were very poor.
In his supplementary report, Dr Wallace was asked to consider the report of Assoc Prof Courtenay and the report from Dr Diwan dated 6 December 2024. Dr Wallace said the reports did not cause him to alter his previously expressed opinions. Dr Wallace remained of the view that the applicant would not benefit from further surgical intervention. It was highly unlikely that the applicant would note a durable reduction in the level of symptoms or increase in function.

Applicant’s submissions

The applicant referred to the authority in Diab v NRMA Ltd[1] as setting out the applicable legal test.
[1] [2014] NSWWCCPD 72.
The applicant noted that there was no dispute that she had sustained a workplace injury to her lumbar spine. The applicant noted that Dr Wallace accepted that the applicant’s injury remained symptomatic. The only issue in dispute was whether the surgery proposed by
Dr Diwan was an appropriate treatment modality.
The applicant referred to her statement evidence regarding the effects of the first lumbar surgery, which was funded by the insurer. After some initial improvement, the applicant was left with radicular pain which Dr Diwan proposed to treat with the further surgery.
In her supplementary statement, the applicant confirmed her current situation. The applicant described her quality of life as poor. The applicant’s ability to sit and stand was restricted and she was restricted in her capacity to perform activities outside the home.
The applicant referred to the treating reports from Dr Diwan. The applicant submitted that these reports revealed that Dr Diwan took a conservative and considered approach to the applicant’s treatment. The applicant underwent injections and was referred to pain management prior to the initial surgery.
The reports from Megumi Health were also noted. The applicant submitted that despite a range of medications being trialled, she was not coping from a pain point of view. Dr Gibson had attempted to identify a pharmaceutical approach to manage the applicant’s pain. At the time the surgery was recommended, the applicant was taking six Endone per day, which was clearly unsustainable.
In his report dated 7 August 2024, Dr Diwan explained that the applicant was a good candidate for the proposed surgery given her persistent, significant ongoing back pain. In his response to questions from the insurer, Dr Diwan addressed the heads of consideration described in Diab. The applicant had attempted a range of treatment modalities including injections, physiotherapy and various medications. All alternatives had been trialled and failed.
The applicant submitted that Dr Diwan’s opinions would be given considerable weight, given that he was the treating surgeon and in regular contact with the applicant. Dr Diwan had previously operated on the applicant and seen the pathology with his own eyes. Dr Diwan was best placed to comment on the appropriateness of the surgery. Dr Diwan had provided a considered opinion in support of the proposal.
The applicant described Assoc Prof Courtenay’s report as supportive. No red flags regarding the proposal for surgery were identified and Assoc Prof Courtenay appropriately deferred to the opinion of Dr Diwan.
The applicant submitted that Dr Wallace had provided the only contrary opinion. Dr Wallace accepted the pathology and symptoms but recommended further physiotherapy and Panadol. The applicant submitted that the applicant’s use of medication had been prescribed by a pain management specialist. It was unclear whether Dr Wallace was as well qualified to comment on the medication regime.
The applicant submitted that Dr Wallace simply reasoned that the proposed surgery would not be of benefit because the previous surgery had been unsuccessful. Dr Wallace’s report suffered from a lack of consideration or explanation when compared with Dr Diwan’s considered approach.
Dr Diwan had responded to Dr Wallace’s opinion and reasoned that the listhesis and facet osteoarthrosis rendered the surgery reasonably necessary in the applicant’s particular circumstances. Dr Diwan had a more positive outlook on the probability of success. Comparing the two opinions, the Commission would be satisfied that the treatment proposed was reasonably necessary.

Respondent’s submissions

The respondent agreed that there was a medical dispute between Dr Diwan and Dr Wallace. Referring to the decision in Rose v Health Commission (NSW),[2] the respondent urged the Commission to exercise “prudence” in determining whether it was “essential” that the treatment should be afforded to the applicant. It was necessary to consider the efficacy of the procedure and the potential for it to improve or ameliorate the effects of the injury.
[2] (1986) 2 NSWCCR 32 (Rose).
In the present case, there was a complex medical picture with a number of red flags. The applicant had a number of comorbid conditions including long-standing rheumatoid arthritis, mental health conditions and a history of addiction. The evidence indicated that the applicant had expressed interest in medicinal cannabis treatment and was due to commence a trial. There was no evidence as to how the trial went. The respondent submitted that the Commission would have grave reservations about the proposed surgery in these circumstances.
The respondent referred to the applicant’s statement evidence. The applicant’s evidence was deficient with regard to the medications she was taking and how effective they were. The inadequacies in the applicant’s statement evidence were recognised by her solicitors who had lodged a late supplementary statement.
In that supplementary statement, the applicant sought to put words into the mouth of
Dr Diwan. The applicant referred to her hip condition but it remained unclear how that had been addressed. The applicant said her quality of life was poor but did not explain why. The applicant said she had derived some benefit from the first surgery. This was not confirmed by the treating evidence. The applicant’s evidence as to her sitting and standing restrictions appeared to be exaggerated. The respondent submitted that the Commission would not place weight on the statement evidence.
Referring to the applicant’s psychological history, the respondent submitted that this had the potential to impact on the probability of a positive outcome from the surgery. The respondent referred to the decision in Ford v Narrabri Shire Council[3] and suggested that the surgery had potential to render the applicant’s psychological comorbidities unstable. No evidence had been provided from a psychiatrist as to the suitability of surgery in the applicant’s circumstances. The psychological evidence did not suggest the applicant was a suitable candidate for surgery.
[3] [2022] NSWPICPD 40.
The respondent noted that Dr Gibson had recommended that the applicant’s rheumatoid condition be investigated prior to surgery taking place. The was no evidence from a rheumatologist. The respondent described this as a major gap in the evidence.
Referring to the evidence from Megumi Health, the respondent noted that the applicant appeared to derive no analgesic effect from her medications. The evidence indicated that the applicant had been prescribed medicinal cannabis treatment. There was no evidence of a review with Dr Gibson and the applicant said nothing about the cannabis treatment in her statement evidence.
The respondent observed that there was a difference of clinical opinion between Dr Diwan and Dr Wallace. Dr Diwan relied on a subtle listhesis which he said could be fixed by surgical fusion. Otherwise, Dr Diwan did not go into much detail in explaining the need for surgery.
Dr Wallace observed that there was post-operative scarring following the first procedure.
Dr Wallace considered there was a high risk in re-entering that area again. Dr Wallace’s warning ought to be heeded.
The respondent observed that there was no evidence of any pain management undertaken in the last six months, including the medicinal cannabis trial. There was a lack of material in relation to the comorbidities, including the hip and rheumatoid arthritis conditions. In those circumstances, the applicant had not discharged her onus.
The respondent observed that Dr Wallace had suggested the applicant would benefit from continuing physiotherapy, a home exercise program and Panadol. Those recommendations were appropriate given the applicant’s addiction history.
The respondent submitted that Assoc Prof Courtenay’s opinions were difficult to decipher. Assoc Prof Courtenay noted that the rheumatology condition had not been investigated. Assoc Prof Courtenay’s history suggested the first surgery was not effective and the vacuum cleaner incident was only minor. This suggested there was a risk of the further surgery also being ineffective.

Applicant’s submissions in reply

The applicant noted that the respondent’s submissions in relation to the applicant’s comorbidities were made without reference to any medical evidence. There was no medical opinion for the respondent suggesting the comorbidities were a contraindication to surgery.
The applicant gave instructions that she had made an application to the insurer for funding for medicinal cannabis treatment which was denied.
The applicant described the respondent’s submissions as “smoke and mirrors” and said they would not be accepted in the absence of medical evidence.
All Dr Wallace said on the subject was that there was an evolving neuritis and that the surgery would not relieve the post-operative complications from the previous surgery.
This could be contrasted with the detailed reports from Dr Diwan, supported by Assoc Prof Courtenay and the applicant’s statement evidence.
The applicant submitted that the respondent’s submissions ought to be disregarded.

FINDINGS AND REASONS

Section 60 of the 1987 Act relevantly provides:
“(1)    If, as a result of an injury received by a worker, it is reasonably necessary that:
(a) any medical or related treatment (other than domestic assistance) be given, or
(b)     any hospital treatment be given, or
(c) any ambulance service be provided, or
(d)     any workplace rehabilitation service be provided,
the worker's employer is liable to pay, in addition to any other compensation under this Act, the cost of that treatment or service and the related travel expenses specified in subsection (2).”
What constitutes reasonably necessary treatment was considered in the context of s 10 of the Workers Compensation Act 1926 in Rose v Health Commission (NSW)[4] where Burke CCJ stated:
“Treatment, in the medical or therapeutic context, relates to the management of disease, illness or injury by the provision of medication, surgery or other medical service designed to arrest or abate the progress of the condition or to alleviate, cure or remedy the condition. It is the provision of such services for the purpose of limiting the deleterious effects of a condition and restoring health. If the particular ‘treatment’ cannot, in reason, be found to have that purpose or be competent to achieve that purpose, then it is certainly not reasonable treatment of the condition and is really not treatment at all. In that sense, an employer can only be liable for the cost of reasonable treatment.”
[4] (1986) 2 NSWCCR 32 (Rose).
Further, his Honour added:
“1.     Prima facie, if the treatment falls within the definition of medical treatment in section 10(2), it is relevant medical treatment for the purposes of this Act. Broadly then, treatment that is given by, or at the direction of, a medical practitioner or consists of the supply of medicines or medical supplies is such treatment.
2.      However, although falling within that ambit and thereby presumed reasonable, that presumption is rebuttable (and there would be an evidentiary onus on the parties seeking to do so). If it be shown that the particular treatment afforded is not appropriate, is not competent to alleviate the effects of injury, then it is not relevant treatment for the purposes of the Act.
3.      Any necessity for relevant treatment results from the injury where its purpose and potential effect is to alleviate the consequences of injury.
4.      It is reasonably necessary that such treatment be afforded a worker if this Court concludes, exercising prudence, sound judgment and good sense, that it is so. That involves the Court in deciding, on the facts as it finds them, that the particular treatment is essential to, should be afforded to, and should not be forborne by, the worker.
5.      In so deciding, the Court will have regard to medical opinion as to the relevance and appropriateness of the particular treatment, any available alternative treatment, the cost factor, the actual or potential effectiveness of the treatment and its place in the usual medical armoury of treatments for the particular condition.”
In Bartolo v Western Sydney Area Health Service[5] his Honour stated:
“The question is should the patient have this treatment or not. If it is better that he has it, then it is necessary and should not be forborne. If in reason it should be said that the patient should not do without this treatment, then it satisfies the test of being reasonably necessary.”
[5] [1997] NSWCC 1.
In Diab v NRMA Ltd,[6] Roche DP provided a summary of the relevant principles as follows:
[6] [2014] NSWWCCPD 72.
“In the context of s 60, the relevant matters, according to the criteria of reasonableness, include, but are not necessarily limited to, the matters noted by Burke CCJ at point (5) in Rose (see [76] above), namely:
(a) the appropriateness of the particular treatment;
(b) the availability of alternative treatment, and its potential effectiveness;
(c) the cost of the treatment;
(d) the actual or potential effectiveness of the treatment, and
(e)the acceptance by medical experts of the treatment as being appropriate and likely to be effective.
With respect to point (d), it should be noted that while the effectiveness of the treatment is relevant to whether the treatment was reasonably necessary, it is certainly not determinative. The evidence may show that the same outcome could be achieved by a different treatment, but at a much lower cost. Similarly, bearing in mind that all treatment, especially surgery, carries a risk of a less than ideal result, a poor outcome does not necessarily mean that the treatment was not reasonably necessary. As always, each case will depend on its facts.
While the above matters are ‘useful heads for consideration’, the ‘essential question remains whether the treatment was reasonably necessary’ (Margaroff v Cordon Bleu Cookware Pty Ltd [1997] NSWCC 13; (1997) 15 NSWCCR 204 at 208C). Thus, it is not simply a matter of asking, as was suggested in Bartolo, is it better that the worker have the treatment or not. As noted by French CJ and Gummow J at [58] in Spencer v Commonwealth of Australia [2010] HCA 28, when dealing with how the expression ‘no reasonable prospect’ should be understood, ‘[n]o paraphrase of the expression can be adopted as a sufficient explanation of its operation, let alone definition of its content’.”[7]
[7] At [88] to [90].

Deputy President Roche commented further:[8]
“Reasonably necessary does not mean ‘absolutely necessary’ (Moorebank at [154]). If something is ‘necessary’, in the sense of indispensable, it will be ‘reasonably necessary’. That is because reasonably necessary is a lesser requirement than ‘necessary’. Depending on the circumstances, a range of different treatments may qualify as ‘reasonably necessary’ and a worker only has to establish that the treatment claimed is one of those treatments. A worker certainly does not have to establish that the treatment is ‘reasonable and necessary’, which is a significantly more demanding test that many insurers and doctors apply.”
[8] At [86].
These proceedings concern a relatively narrow dispute, being whether the L5-S1 transforaminal lumbar interbody fusion surgery proposed by Dr Diwan is reasonably necessary as a result of the accepted workplace injury.
There is no dispute on the evidence that the applicant’s workplace injury remains symptomatic. The applicant’s symptoms have been described in a consistent fashion in both the treating and medicolegal evidence as well as her lay evidence. While there have been investigations into symptoms at the right hip and some dispute as to whether those symptoms were causally related to the injurious event, the doctors involved in this case have consistently recorded symptoms of lumbar spine pain and radiculopathy at the right leg associated with the L5-S1 spinous process.
The applicant’s lumbar symptoms have been extensively treated to date. The evidence confirms that the applicant has undergone injections, physiotherapy, pain management and decompression surgery at the relevant level.
The respondent’s submissions queried whether the first surgery had produced any benefit. The history provided by the applicant at various times was that after a few weeks of some relief, the symptoms deteriorated and this was particularly associated with some light vacuuming at home.
The failure of the previous surgery to provide lasting relief was identified by the respondent’s medicolegal expert, Dr Wallace, as a consideration weighing against further operative intervention.
Dr Wallace also noted that the MRI investigations showed evidence of post-operative granulation tissue surrounding the right S1 nerve root which might be causing mild neuritis and producing the applicant’s ongoing symptoms. Dr Wallace said further surgery could increase the likelihood of perineural scarring developing around the right S1 nerve root.
The applicant’s treating surgeon, Dr Diwan, was aware of the postsurgical findings before recommending the further surgery. Dr Diwan noted that the MRI scans showed oedema around the S1 nerve root. He described the oedema as “minimal” and considered this was consistent with postsurgical change. Dr Diwan commented that there was no compression or anything of surgical significance.
Similarly, the applicant’s pain management specialist, Dr Gibson noted that perineural fibrosis of the right S1 nerve root was a common postsurgical inflammatory response.
Dr Wallace suggested that the applicant’s symptoms ought to be treated with physiotherapy, an exercise program and simple analgesia such as Panadol. Dr Wallace also referred to a study suggesting that results of spinal fusion in workers compensation cases were very poor in justifying his opinion.
I am not satisfied, however, that Dr Wallace’s reasoning adequately responds to the evidence that the applicant had already undergone extensive conservative treatment using a variety of modalities including physiotherapy and pain medication. While the applicant did not give detailed evidence as to the effects of the conservative treatments, the evidence from
Dr Gibson makes clear that those treatments were ineffective in relieving the applicant’s symptoms. Dr Gibson said the applicant’s remaining pain management options were fairly few in terms of what had not already been trialled.
I am also not satisfied that Dr Wallace has adequately engaged with the pathological justification for the surgery identified by Dr Diwan.
Dr Diwan has identified specific pathology, namely severe facet osteoarthritis with listhesis at L5-S1 as the applicant’s pain generator. That conclusion was reached after seeing the applicant in his clinic on a regular basis over a period of almost 12 months and after multiple radiological investigations. It is that pathology which Dr Diwan proposes to treat through the surgical procedure. Dr Diwan expressed the view that surgical experts in the field of spinal surgery would accept that the procedure was reasonably necessary treatment for such pathology, when all relevant non-operative treatments had been tried and failed to produce benefit.
It is clear that Assoc Prof Courtenay agreed with Dr Diwan that the proposed surgery was appropriate medical treatment, although I agree that other aspects of his report are difficulty to follow.
Assoc Prof Courtenay did indicate that there remained a question about the right hip and said the applicant’s rheumatoid arthritis ought to be investigated. The respondent has submitted that these factors prevented the applicant from discharging her onus.
Dr Diwan was, however, aware of the applicant’s hip pathology and in fact recommended that the applicant follow this up with a hip surgeon. It has not been suggested in any of the medical evidence that the applicant’s symptoms are wholly attributable to hip pathology.
As noted above, Dr Diwan, Assoc Prof Courtenay and Dr Wallace all accepted that the applicant’s lumbar spine was symptomatic.
The applicant’s hip surgeon, Dr Rae, and her pain management specialists also recommended that the applicant’s rheumatoid arthritis be investigated. There is no evidence before the Commission that the applicant has in fact seen a rheumatologist regarding her current symptoms. The history given by the applicant at various times, however, was that the rheumatoid arthritis had previously affected her knees, wrists and finger joints and was kept stable on methotrexate. Having regard to the radiological findings, Dr Rae did not think the applicant’s hip symptoms were the result of an inflammatory arthritis. Similarly, Dr Diwan identified an osteoarthritic process and listhesis at the lumbar spine to account for the applicant’s lumbar symptoms. I am not satisfied in these circumstances that the absence of evidence from a rheumatologist prevents the applicant from discharging her onus.
Other factors identified by the respondent’s submissions as weighing against a finding that the surgery was reasonably necessary medical treatment included the applicant’s psychological history and her prior history of addiction. Dr Diwan, Assoc Prof Courtenay and Dr Wallace all referred to the applicant’s psychological history in their reports. None of those doctors has indicated that this posed a barrier to the surgery’s success. In the absence of medical opinion on this question, I do not accept the respondent’s submission.
The respondent also noted that Dr Gibson had given the applicant a prescription to commence a trial of medicinal cannabis. I accept that there is no evidence before the Commission with regard to whether the medical cannabis treatment was in fact trialled.
Dr Gibson did, however, observe that the best evidence indicated that medicinal cannabis had minimal analgesic effect. None of the other doctors involved in the applicant’s case has suggested that medicinal cannabis would be an effective alternative treatment for the applicant’s symptoms. In any event, the presence of alternative treatments does not preclude a finding that the surgery is also reasonably necessary medical treatment.
I have also noted that respondent’s submissions on the lack of recent evidence of conservative treatment more generally. While I agree that the evidence from Dr Gibson is now more than six months old, prior to the recommendation for surgery, various forms of pain management had been trialled for approximately nine months and other conservative treatments attempted before that. I draw no adverse inference from the age of the evidence given the denial of liability and the commencement of proceedings in the Commission.
In all the circumstances, I accept Dr Diwan’s evidence that the proposed surgery has a good chance of improving the applicant’s pain and quality of life. I am satisfied that the treatment proposed by Dr Diwan is appropriate and potentially effective. Although I have given weight to Dr Wallace’s contrary opinions, for the reasons given above, they do not persuade me otherwise.
The cost of the treatment is substantial. I find, however, that the cost is reasonable given the failure of alternative treatments and the impact of the applicant’s lumbar symptoms on her day-to-day functioning.
I accept Dr Diwan’s evidence, which is supported by Assoc Prof Courtenay, that the procedure is accepted by medical experts as appropriate and likely to be effective in the applicant’s particular circumstances.
Applying the authorities above and weighing all the evidence, I am satisfied that the L5-S1 transforaminal lumbar interbody fusion surgery proposed by Dr Diwan is reasonably necessary as a result of the injury on 10 June 2023.
Accordingly, there will be an order for the respondent to pay the costs of and incidental to the surgery in accordance with s 60 of the 1987 Act.

[2025] NSWPIC 106

24 March 2025