2011 OKLAHOMA WORKERS COMPENSATION CHANGES Title 85 By Bob Burke

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1 2011 OKLAHOMA WORKERS COMPENSATION CHANGES Title 85 By Bob Burke SECTION 301: The entire Title 85 is now known as the Workers Compensation Code. SECTION 302: Oil and gas owners and operators are deemed to be intermediate or principal employers and are immune from third party district court action for negligence. SECTION 303: Establishes a 10-Judge Court. Any position eliminated by a current Judge resigning is reinstated. Future Judges, required to be a workers compensation lawyer for 5 years, will serve an 8-year term and will be subject to reappointment. Present Judges can reapply. All candidates must go through the Judicial Nominating Commission. Present Judges whose terms expire next year will serve until July 1. Governor will nominate Judges by April 15 to allow the State Senate confirmation process to be completed. A Judge must render a decision within 60 days after submission by the parties. The Court may hold hearings in any city in the state. SECTION 304: New Presiding Judge to be appointed by July 1, Present PJ to serve his current term. SECTION 305: The Court Administrator shall be appointed by the Governor, must be confirmed by the State Senate, and shall serve at the pleasure of the Governor. There is no definite term. SECTION 306: No changes in the duties of the Administrator. SECTION 307: The Administrator or employees of the Court are prohibited from referring cases to attorneys. Such action is subject to criminal prosecution and is grounds for removal of Administrator. No funds shall be deducted from a client s proceeds and donated to any political candidate or political action committee. SECTION 308: Changes in Definitions: 1

2 Amount in Dispute limits a claimant s attorney fee in cases in which the employer admits the claim within 20 days. If the employer makes an offer within 30 days of the employee reaching maximum medical improvement, attorney can charge 35 % of difference between offer and award or settlement, up to a maximum of 20 % of the entire award or settlement. There is no presumption from the mere occurrence of an unforeseen or unexpected injury that it is workrelated. A heart injury is compensable only if the major cause of such injury is a work-related activity that is extraordinary and unusual to the employee s normal work or is the result of an unusual incident. Dentures, glass eyes, or other prostheses injured in an accident will be repaired or replaced by employer. Death of an employee of natural causes at work is not compensable. A consequential injury is compensable only if proven by objective medical evidence to be a direct result of the original injury. Cumulative trauma is defined as an injury in which the major cause is work that is repetitive in nature over a period of time. Gainful employment is the capacity to perform work for wages over a period of time that is not sporadic, occasional, or part-time. Impaired self-insurer is an own risk employer who becomes unable to satisfy its obligations to provide workers compensation benefits. Incapacity means the inadequate strength or ability to perform a work-related task. Light duty describes work status when a physician releases an employee for work with temporary physical restrictions. Maximum medical improvement means that no further medical improvement would be reasonably expected with further medical treatment or the passage of time. Medical treatment means any attendance by a medical professional, including diagnostic tests, surgery, and fitting of a prosthetic device. Hearing loss shall be established by medically recognized and accepted clinical diagnostic methodologies. Permanent Partial Impairment is a new term for the former Permanent Partial Disability. PPI is any anatomical abnormality or loss of use of a part of the body that can be evaluated by a physician using criteria found in the AMA Guides, Fifth Edition or alternative method created by the Physician Advisory Committee. Permanent Total Disability only can be awarded if the Court finds that the employee does not possess the adequate strength or ability to perform work duties for which he is fitted by reason of education, work experience, or vocational rehabilitation. Prosthetic device is an artificial device that is used to replace a part or joint of the body injured in an accident or illness. Qualified Independent Medical Examiner can only be an MD or DO. 2

3 Scheduled member means hands, fingers, arms, eyes, feet, toes, and legs. For purposes of the Multiple Injury Trust Fund, hearing is also a scheduled member. Subcontractor is an employer hired by a general contractor to perform a specific task for the completion of a work activity. Surviving spouse definition now requires the Workers Compensation Court to make determination of a common law marriage. No longer will uncontested district court adjudication of a common law marriage be the final word on the issue. Temporary Partial Disability is the status of an employee under active medical care who is unable to perform some of his normal work duties or cannot work normal number of hours. Wages now includes bonuses, commissions, or similar advantage received by the employee. SECTION 309: Same method for computing time. SECTION 310: Court has jurisdiction only in cases in which the injury occurs in the state or if the employee was hired here. A claim adjudicated in another jurisdiction cannot be re-litigated in Oklahoma. If claim in other state has not been concluded, Oklahoma claim can be filed. SECTION 311: Retains exemptions of certain employers under the Code. Combines several former separate sections of Title 85. SECTION 312: An injury is not compensable if the employee willfully fails to use a guard or protection against accident pursuant to a statute or order of the Commissioner of Labor. An employee who tests positive for the presence of alcohol, illegal drugs, or illegal chemicals is not entitled to compensation under the Workers Compensation Code. Presumably, any injury that occurs where the employee tests positive for these substances will now be litigated in district court. No compensation for an injury that occurs before a person is hired or after he is terminated. SECTION 313: Sets up rules for government entities to be able to provide workers compensation benefits either by purchasing insurance or self-insuring. SECTION 314: Secondary liability attaches to an Intermediate Employer only if the work by a subcontractor is directly associated with the day-to-day business activities of the Intermediate Employer or if it is the same time of work normally conducted in the Intermediate Employer s trade, industry, or business. SECTION 315: 3

4 Benefits determined by date of accident. Single event date of accident is the date of injury. Cumulative trauma date of accident is the date when the employee knew, or reasonably should have known, that injury or illness was caused by work-related activity. Date of accident in death case is date of death. SECTION 316: Retains present liability of last employer for occupational disease or illness. SECTION 317: Retains present liability of last employer of more than 90 days of injurious exposure in cumulative trauma claims. SECTION 318: Changes to two years the time in which a claim must be prosecuted or dismissed for want of prosecution. SECTION 319: Retains right of employee to dismiss a claim, either with or without prejudice. SECTION 320: Requires Administrator to expand Counselor or Ombudsman program. Administrator must notify within 10 days any employee, whose employer files a Form 2, of the availability of the Ombudsman program. By April, 2012, Administrator must develop an annual training program for own risk employers and claims representatives, emphasizing availability of Ombudsman and mediation services of the Court. SECTION 321: A mediator need not be an attorney. Mediations must be conducted in good faith. Lack of good faith shall be reported to the Judge. Mediation can occur without employee being represented by an attorney. SECTION 322: Retains requirement for employers to promptly file a Form 2 and post notice of right to workers compensation benefits. SECTION 323: Adds to the Form 3 the requirement for information about the employee s Social Security Disability and Medicare status. SECTION 324: The Administrator shall issue notice a Pre-Hearing or Trial within 7 days of the filing of a request by any party. SECTION 325: 4

5 Tulsa. The Administrator shall develop a plan for proportionately dividing cases between Oklahoma City and SECTION 326: The employer shall provide reasonable and necessary medical care within 7 days of notice of injury. If employer does not provide treatment, the employee is free to choose treating physician. No change in definition of treating physician, including chiropractors. Form A procedure to change treating physician retained, but limited. The Judge shall approve a change of physician automatically only if there has been authorized medical care to that part of the body in the past 180 days. No more than 2 Form A s in a case, regardless of the number of body parts injured. Effective February 1, 2012, the Official Disability Guidelines (ODG) will govern scope and duration of medical care for all body parts but the spine. In regard to the spine, ODG will be the principal mandatory guideline. However, if ODG does not cover or recommend a certain treatment to the spine, the Physician Advisory Committee will adopt the Oklahoma Treatment Guidelines (OTG). If treatment is appropriate under ODG or OTG, such treatment will be presumed to be reasonable and necessary. Employer is not responsible for treatment outside ODG or OTG unless it was authorized by the employer or insurance carrier, was rendered in an emergency, or if the Judge finds that treatment outside ODG or OTG is in the best interest of the employee. Continuing maintenance medical shall not be ordered by the Court unless the treating physician at MMI or an IME recommends it. The Court may appoint an IME to determine the extent of CMM needed. Employer is not liable for CMM not ordered by Court or pre-approved by carrier. New mileage scheme. Reimbursement for actual mileage to and from medical appointment in excess of 20 miles. The 600-mile round trip limitation is retained. SECTION 327: The Administrator shall develop a new Medical Fee Schedule by January 1, It shall reflect a 5 % savings in medical reimbursement rates. Fee Schedule will cover all areas of medical reimbursement, including prosthetics, dentists, and ambulance service. In making adjustments to Fee Schedule, Administrator shall use as a benchmark the Oklahoma Medicare Fee Schedule. No reimbursement allowed for an MRI from a machine with a field strength of at least 1.0 Tesla. Reimbursement rate for an MRI shall be reduced to 207 % of the 2010 Medicare Fee Schedule. All other diagnostic services frozen at 2010 Oklahoma Fee Schedule rates of reimbursement. The reimbursement rate for Evaluation and Management (office visits) by physicians raised to no less than 150 % of Medicare. The stop-loss provision of the Fee Schedule will be limited to major burn injuries, multi-system injuries, and other catastrophic injuries. Sets out formula to limit the reimbursement rate for durable medical equipment and implantables. hour. Raises physician s reimbursement of time for preparation and participation in a deposition to $400 per 5

6 Sets out limitations on reimbursement for prescription drugs. Rate reduced to mail order rate, if mail order available. No upcharge allowed for repackaging or formulation of drugs. The lowest priced NDC number for a repackaged drug shall be used. Requires a physician to make full disclosure of ownership interest in any other medical care facility or business outside his own practice. Employer or insurance carrier must pay invoice for medical treatment within 45 days, unless carrier has good faith reason for delay, such as requesting additional information. If no good faith reason exists, the Court may assess a 25 % maximum penalty plus attorney s fees. In cases of a pattern of non-payment without a good faith reason for delay, a per occurrence fine can be levied. If no good faith reason exists, employee shall reimburse carrier for any payment charged by medical service provider for no-show. SECTION 328: Retains provisions dealing with certified workplace medical plans (CWMP). However, the requirement that the Court follow the opinion of the medical director of a CWMP in regard to the necessity of medical treatment is removed. SECTION 329: Current IME s on the effective date of the law are grandfathered in for the remainder of a two-year term. Thereafter, IME s must be either an MD or DO. The Judge, regardless of the date of injury, may appoint an IME on any issue at any time. If surgery is recommended by a treating physician, the employer or insurance carrier shall have the option of an automatic IME to determine reasonableness and necessity of surgery. IME must be a physician qualified to perform the recommended surgery. The Workers Compensation Advisory Council and the Physician Advisory Committee shall screen future applications of physicians in regard to the IME list. SECTION 330: Existing case managers are grandfathered in. SECTION 331: Sets out simple formula for determining average weekly wage in every circumstance. SECTION 332: TTD is paid at 70 % of average weekly wage. No TTD for first seven days, but is retroactive to first day missed if employee is TTD more than 21 days. Maximum period of TTD is 156 weeks. A 52-week extension may be granted if employee is TTD from a consequential injury. Adds abandonment of medical care, missing 3 medical appointments without valid excuse, and failing to comply with physician s recommendations as conditions for termination of TTD. If request to terminate TTD is objected to, a hearing shall be held within 20 days. 6

7 Sets up quicker resolution of light duty issues. If treating physician releases for light duty, the employer offers such assignment in writing, and employee refuses, TTD may be terminated, unless Court finds employee could not have performed the work or that temporary restrictions were unreasonable. TTD can be unilaterally terminated if employer confirms that employee is incarcerated. Maximum Temporary Partial Disability period reduced to 156 weeks, with a 52-week extension upon finding of consequential injury. If an employer provides medical care within 7 days of oral or written notice of nonsurgical soft tissue injury, TTD or TPD is limited to 8 weeks. No stacking of body parts. Upon recommendation of an injection, another 8 weeks may be granted. If surgery is recommended, another 16 weeks may be granted. TTD can be terminated if employee is responsible for a delay in surgery of more than 90 days. If surgery is performed, 8- week scheme is not applicable and employee is entitled to 156 week limitation. This section applies to all cases heard after the effective date of the act, regardless of the date of injury. The 8-week scheme does not apply if there is objective medical evidence of an anatomical abnormality. The Court may consider if employee s wage-earning capacity is adversely affected by the injury. TTD cannot be awarded for periods of time in which employee is drawing state unemployment benefits or short term disability payments from a plan provided by the employer. SECTION 333: A PPI report may be written only by an MD or DO. No reports from chiropractors or psychologists. Allowing such a report would be an abuse of discretion by the Court. No PPI for a part of the body for which no medical treatment was received. The Physician Advisory Committee is allowed to recommend evaluation of PPI using the AMA Guides and alternative methods. If the legislature does not overturn the recommendation, any new procedure will become effective 10 days after the legislature adjourns. Upon a third hernia in the same area of the body, the Court may order normal TTD and PPI. No PPI award of more than 520 weeks unless the latest injury resulted in surgery or amputation. Wage earning ability can be considered by Judge in determining existence of PPI. The arm is defined as that part of the body beginning at the surgical neck of the humerus. Therefore, any injury to the shoulder is an injury to the body as a hole. SECTION 334: Retains $50,000 cap on disfigurement. SECTION 335: Requires employer to maintain and replace, when needed, a prosthetic device or artificial joint, for the lifetime of the employee. If prosthetic is damaged in subsequent injury, new employer must replace or repair. Liability for lifetime maintenance and replacement is terminated upon a reinjury to the same part of the body. SECTION 336: 7

8 Permanent Total Disability benefits are paid during the life of the employee to the Maximum Social Security Retirement age or 15 years, whichever is longer. Such benefits terminate upon the death of the employee. However, a person entitled to revive receives a one-time lump sum payment of 26 weeks of PTD benefits. MMI. PTD may be allowed for an employee who has exhausted allowable TTD benefits and has not reached A PTD recipient may be required to file an affidavit each year that he is not nor has been engaged in gainful employment. Failure to file affidavit terminates benefits. Automatic review of PTD orders every three years. SECTION 337: of survivors. Reorganizes death benefit system of payments, but only minor changes in benefits or definition SECTION 338: The Administrator shall hire or contract for the services of a Vocational Rehabilitation Director to coordinate voc rehab services of Court. Voc Rehab may be ordered by the Court while employee remains under active medical care. The old 16 D benefits are now 338 H benefits. SECTION 339: A new method of settlement is created. Rather than a JP, the Compromise Settlement can be used to settle a case in full or in part. For example, the indemnity can be settled, but medical benefits can remain open. Any issue can remain unsettled, if such exception is noted in the form prescribed by the Court. When employee is unrepresented, only a Form 2 is filed to give the Court full jurisdiction to settle the claim. The Administrator or a Judge is required to approve any Compromise Settlement of which a record must be made. SECTION 340: The current appeals procedures to the Court En Banc and Supreme Court are retained. However, new standard of review passed by 2010 legislature affects any case coming before the appellate courts after the effective date of the 2011 overhaul of Title 85, regardless of the date of injury. SECTION 341: Retains provisions making it illegal to fire a worker for filing a workers compensation claim. Also relieves employer of responsibility of rehiring employee if restrictions prevent employee from returning to former position. SECTION 342: Requires objective medical evidence for a change of condition and a consequential injury. No additional PPI award of more than 520 weeks for a change of condition unless there is surgery or amputation to a part of the body for which a change of condition is ordered. 8

9 SECTION 343: No attorney s fee for TTD which was being paid when attorney was hired. No attorney s fee in uncontested death case, on vocational rehabilitation benefits, or on the amount of a Medicare Set Aside agreement. Attorney s fee in contested death case limited to 20 % of lump sum and accrued benefits. No attorney s fee of more than 20 % allowed. SECTION 344: party. If any proceeding is groundless, the Court may order the cost of the proceedings be paid by the moving If the employer or carrier fail to pay travel reimbursement within 60 days of receipt of request for reimbursement, the Court shall assess a $500 fine paid to the employee. SECTION 345: Restatement of present law on payment of awards. SECTION 346: Allows for certification of unpaid order. SECTION 347: Gives Court subpoena powers and right of enforcement. SECTION 348: Allows subrogation by employer in injury and death cases. Allows employer to take a credit (deficiency) toward future payments in the workers compensation case for the amount of employee s net recovery in a third party action. SECTION 349: Claims cannot be assigned. Employees cannot be forced to pay any part of workers compensation insurance premium. SECTION 350: Recodifies supremacy of child support liens. SECTION 351: Retains methods of employer meeting obligation to provide benefits, either by securing insurance or becoming self insured. SECTION 352: Provides for penalties for not carrying workers compensation insurance or self insuring. SECTION 353: 9

10 Sets out procedure for assessing a civil fine for not securing payment of benefits. SECTION 354: Provides for criminal penalty for failing to secure payment of benefits. SECTION 355: SECTION 356: Restricts activities of the Administrator of a Self Insurance Association. Retains current requirements of a workers compensation insurance policy. SECTION 357: Retains current estoppel doctrine. If premium is charged by a carrier, carrier is estopped from denying coverage. SECTIONS 358 THROUGH 366: Sets up a detailed system of administering the individual and group self insurance guaranty funds. Combines the boards and functions of the two systems. Anyone affected by these sections should contact the Administrator for further details. SECTION 367: Requires annual report of the Court to the Governor and legislature. Administrator shall develop an electronic data interchange (EDI) system by July 1, The Governor shall appoint a five-person committee to develop the scope of information which shall be gathered jointly by the Administrator and the Insurance Commissioner. SECTION 368: Retains current Court fee for final award. SECTION 369: Retains current Court fees in self insured transactions and reports. SECTION 370: Sets a $1.00 per page fee for copying Court records. SECTION 371: Retains current law of requiring employers to provide books and records to Administrator. SECTION 372: By January 1, 2012, Administrator shall implement a plan to publish on the Court s website the names of all persons who have filed a Form 3 within the past ten years, and annually update the posting. SECTION 373: 10

11 Membership and appointing authorities of the nine members of the Physician Advisory Committee are slightly changed. Terms of all members expire on the effective date of SB 878 and positions will be refilled. By March 1, 2012, the PAC shall develop the Oklahoma Treatment Guidelines for medical treatment to the spine for which no treatment is covered or recommended by the Official Disability Guidelines. Several layers of oversight, including public hearings before the PAC and the Workers Compensation Advisory Council, and right of rejection by the legislature. SECTION 374: Reconstitutes the Workers Compensation Advisory Council. Retains current members until expiration of present terms. SECTIONS 375 THROUGH 401: These sections are a recodification of present law constituting and governing CompSource Oklahoma. SECTION 402: Simplifies, but retains, current definition of a physically impaired person for purposes of the Multiple Injury Trust Fund (MITF). Allows a finding of previous impairment to a part of the body only if that part of the body was injured in the claim being adjudicated. Makes section procedural from effective date of SB 878. SECTION 403: Reconstitutes and sets up funding mechanism for MITF. SECTION 404: SECTION 405: Retains current mechanism for paying orders of the MITF. Allows MITF to compromise any claim. Establishes a statute of limitations for filing a MITF claim two years from the order for PPI in the last injury against the employer. Claim against MITF must be prosecuted within three years of filing of claim or be dismissed for want of prosecution. SECTION 406: CompSource Oklahoma charged with administration and protection of MITF. SECTION 407: Sets up Workers Compensation Administration Fund to accept payments. SECTION 408: Retains current law that all forms contain Under Penalty of Perjury language. SECTION 409: Recodifies ability of Court to order one of multiple employers or carriers to begin payment of benefits and reserves the right for employers or carrier rights to be later adjudicated. 11

12 SECTION 410: Retains present obligation of employees to provide medical records and parties to give information to any investigating authority. SECTION 411: Provides that any provision of the Code found to be substantive in nature shall apply to injuries that occur on or after the effective date of the Code. SECTION 412: Transfers funds and other assets of the Workers Compensation Court on the effective date of the Code to the Court. Transfers funds and other assets of the guaranty funds, MITF, PAC, or the Advisory Council on the effective date of the Code to such guaranty funds, MITF, PAC, and the Advisory Council. SECTION 413: Retains law that no advance waiver of benefits under the Workers Compensation Code shall be valid. 12

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