The nation s most experienced provider of workers compensation information, tools, and services

The nation s most experienced provider of workers compensation information, tools, and services July 11, 2014 ITE Report Contact: Legislative_Activity@ncci.com Regulatory Services RLA-2014-27 State Issues Contacts: Please refer to the list of State Relations Executives at the end of this report. LEGISLATIVE ACTIVITY LEGISLATIVE SESSION UPDATES This report contains descriptions and/or excerpts of relevant bills that have passed the first chamber, passed the second chamber, or have been enacted during the specific periods. In addition, a recap of significant legislative and judicial activity impacting the workers compensation system will be included in the first report published each month. This report is issued on a weekly basis throughout the legislative season, and it provides updates on the content of these bills if and when they progress through the legislative process. This report includes bills from states where NCCI provides ratemaking services (see state list under Contact Information) and the US Congress. BILLS ENACTED The following bill was enacted within the one-week period ending July 2, 2014. Rhode Island HB 8282 was: Passed by the first chamber on June 20, 2014 Passed by the second chamber on June 21, 2014 Included in NCCI s July 4, 2014 Legislative Activity Report (RLA-2014-26) Enacted and effective on July 1, 2014 HB 8282 amends various sections of the State of Rhode Island General Laws related to the procedure and administration of the Rhode Island workers compensation court as follows: 28-29-30. Advisory council. (a) There is created a workers compensation advisory council consisting of fifteen (15) sixteen (16) members as follows: (1) The chief judge of the workers compensation court and one additional judge of the workers compensation court and one member of the Bar who primarily represents injured workers before the workers compensation court, both the to be selected by the chief judge; (2) The director of business regulation; (3) The director of administration; (4) Three (3) representatives from labor appointed by the governor, one of whom shall be an injured worker; (5) Three (3) representatives from business appointed by the governor, one of whom shall be a self-insured employer, and one of whom shall represent cities and towns; (6) One representative from the general public appointed by the governor; (7) The chairperson of the senate labor committee or his or her designee; and (8) The chairperson of the house labor committee or his or her designee; (9) The director of labor and training; (10) The chief executive officer of the workers compensation insurance fund or his or her designee. (b) It shall be the duty of the council to advise the governor and the general assembly, on an annual basis, on the administration of the workers compensation system. 28-33-8. Employee s choice of physician, dentist, or hospital Payment of charges Physician reporting schedule. (b) Within three (3) days of an initial visit following an injury, the health care provider shall provide to the insurer or self-insured employer, and the employee and his or her attorney a notification of compensable injury form to be approved by the administrator of the medical advisory board. Within three (3) days of the injured employee s release or discharge, return to work, and/or recovery 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 1 of 10

from an injury covered by chapters 29 38 of this title, the health care provider shall provide a notice of release to the insurer or self-insured employer and the employee and his or her attorney on a form approved by the division. A twenty dollar ($20.00) fee may be charged by the health care provider to the insurer or self-insured employer for the notification of compensable injury forms or notice of release forms or for affidavits filed pursuant to subsection (c) of this section, but only if filed in a timely manner. No claim for care or treatment by a physician, dentist, or hospital chosen by an employee shall be valid and enforceable as against his or her employer, the employer s insurer, or the employee, unless the physician, dentist, or hospital gives written notice of the employee s choice to the employer/insurance carrier within fifteen (15) days after the beginning of the services or treatment. The health care provider shall in writing submit present to the employer or insurance carrier an itemized bill and report for the services or treatment and a final itemized bill for all unpaid services or treatment within three (3) months after the conclusion of the treatment. The employee shall not be personally liable to pay any physician, dentist, or hospital bills in cases where the physician, dentist, or hospital has forfeited the right to be paid by the employer or insurance carrier because of noncompliance with this section. (d) Itemized bill, as referred to in this section, means a completed statement of charges, on a form CMS HCFA 1500, UB 92/94 or other form suitable to the insurer, which includes, but is not limited to, an enumeration of specific types of care provided, facilities or equipment used, services rendered, and appliances or medicines prescribed, for purposes of identifying the treatment given the employee with respect to his or her injury. (f) (1) Compensation for medical expenses and other services under Section 28-33-5, 28-33-7 or 28-33-8 is due and payable within twenty-one (21) days from the date a request is payment is not made within twenty-one (21) days from the date a request is made for payment, the provider of medical services may add, and the insurer or self-insurer shall pay, interest at the per annum rate as provided in Section 9-21-10 on the amount due. The employee or the medical provider may file a petition with the administrator of the workers compensation court which petition shall follow the procedure as authorized in chapter 35 of this title. (2) The twenty-one (21) day period in subdivision (1) of this subsection and in Section 28-35-12 shall begin on the date the insurer receives a request with appropriate documentation required to determine whether the claim is compensable and the payment requested is due. 28-33-17. Weekly compensation for total incapacity Permanent total disability Dependents allowances. (a) (1) While the incapacity for work resulting from the injury is total, the employer shall pay the injured employee a weekly compensation equal to seventy-five percent (75%) of his or her average weekly spendable base wages, earnings, or salary, as computed pursuant to the provisions of Section 28-33-20. The amount may not exceed more than sixty percent (60%) of the state average weekly wage of individuals in covered employment under the provisions of the Rhode Island Employment Security Act as computed and established by the Rhode Island department of labor and training, annually, on or before May 31 of each year, under the provisions of Section 28-44-6(a). Effective September 1, 1974, the maximum rate for weekly compensation for total disability shall not exceed sixty-six and two-thirds percent (662/3%) of the state average weekly wage as computed and established under the provisions of Section 28-44-6(a). Effective September 1, 1975, the maximum rate for weekly compensation for total disability shall not exceed one hundred percent (100%) of the state average weekly wage as computed and established under the provisions of Section 28-44-6(a). Effective September 1, 2007, the maximum rate for weekly compensation for total disability shall not exceed one hundred fifteen percent (115%) of the state average weekly wage as computed and established under the provisions of Section 28-44- 6(a). Effective October 1, 2016, the maximum rate for weekly compensation for total disability shall not exceed one hundred twenty percent (120%) of the state average weekly wage as computed and established under the provisions of Section 28-44-6(a) and effective October 1, 2017, the maximum rate for weekly compensation for total disability shall not exceed one hundred twenty - five percent (125%) of the state average weekly wage as computed and established under the provisions of Section 28-44-6(a). If the maximum weekly benefit rate is not an exact multiple of one dollar ($1.00), then the rate shall be raised to the next higher multiple of one dollar ($1.00). 28-33-18.3. Continuation of benefits Partial incapacity. (a) (1) For all injuries occurring on or after September 1, 1990, in those cases where the employee has received a notice of intention to terminate partial incapacity benefits pursuant to Section 28-33-18, the employee or his or her duly authorized representative may file with the workers compensation court a petition for continuation of benefits on forms prescribed by the workers compensation court. In any proceeding before the workers compensation court on a petition for continuation of partial incapacity benefits, where the employee demonstrates by a fair preponderance of the evidence that his or her partial incapacity poses a material hindrance to obtaining employment suitable to his or her limitation, partial incapacity benefits shall continue. For injuries on and after July 1, 2016 2018, material hindrance is defined to include only compensable injuries causing a greater than sixty-five percent (65%) degree of functional impairment and/or disability. Any period of time for which the employee has received benefits for total incapacity shall not be included in the calculation of the three hundred and twelve (312) week period. (2) The provisions of this subsection apply to all injuries from Sept. 1, 1990, to July 1, 2016 2018. 28-35-12. Petition for determination of controversy Contents and filing. (a) In all disputes between an employer and employee in regard to compensation or any other obligation established under chapters 29-38 of this title, and when death has 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 2 of 10

resulted from the injury and the dependents of the deceased employee entitled to compensation are, or its apportionment among them is, in dispute, any person in interest or his or her duly authorized representative may file with the administrator of the workers compensation court a petition prescribed by the court, setting forth the names and residences of the parties, the facts relating to employment at the time of injury, the cause, extent, and character of the injury, the amount of wages, earnings, or salary received at the time of the injury, and the knowledge of the employer of notice of the occurrence of the injury, and any other facts that may be necessary and proper for the information of the court, and shall state the matter in dispute and the claims of the petitioner with reference to it; provided, that no petition shall be filed within twenty-one (21) days of the date of the injury and no petition regarding any other obligation established under chapters 29-38 of this title shall be filed until twenty-one (21) days after written demand for payment upon the employer or insurer or written notice to the employer or insurer of failure to fulfill the obligation, except that any petition alleging the non-payment or late payment of weekly compensation benefits, attorneys fees, and costs, may be filed after fourteen (14) days from the date the payment is due as set forth in Sections 28-35-42, 28-35-43, and 28-35-20(c). All demands seeking payment of bills for medical services rendered shall include reference to a claim number or a legible copy of the agreement, order, and/or decree, if appropriate, establishing liability. Medical bills for services ordered paid by decree or pretrial order shall be paid within fourteen (14) days of the entry of the decree or order. In the event that the bills are not paid within the fourteen (14) day period, a petition may be filed to enforce said order or decree without any additional written notice to the employer or insurer. 28-53-2. Establishment Sources Administration. (a) There shall be established within the department of labor and training a special restricted receipt account to be known as the Rhode Island uninsured employers fund. The fund shall be capitalized from excise taxes assessed against uninsured employers pursuant to the provisions of Section 28-53-9 of this chapter and from general revenues appropriated by the legislature. Beginning in state fiscal year ending June 30, 2015 2016, the legislature may appropriate up to two million dollars ($2,000,000) in general revenue funds annually for deposit into the Rhode Island uninsured employers fund. 28-53-7. Payments to employees of uninsured employers. (a) Where it is determined that the employee was injured in the course of employment while working for an employer who fails to maintain a policy of workers compensation insurance as required by Rhode Island general laws Section 28-36-1, et seq., the uninsured employers fund shall pay the benefits to which the injured employee would be entitled pursuant to chapters 29 to 38 of this title subject to the limitations set forth herein. (b) The workers compensation court shall hear all petitions for payment from the fund pursuant to Rhode Island general laws Section 28-30-1, et seq., provided, however, that the uninsured employers fund and the employer shall be named as parties to any petition seeking payment of benefits from the fund. (c) Where an employee is deemed to be entitled to benefits from the uninsured employers fund, the fund shall pay benefits for disability and medical expenses as provided pursuant to chapters 29 to 38 of this title except that the employee shall not be entitled to receive benefits for loss of function and disfigurement pursuant to the provisions of Rhode Island general laws Section 28-33-19. (d) The fund shall pay cost, counsel and witness fees as provided in Rhode Island general laws Section 28-35-32 to any employee who successfully prosecutes any petitions for compensation, petitions for medical expenses, petitions to amend a pretrial order or memorandum of agreement and all other employee petitions and to employees who successfully defend, in whole or in part, proceedings seeking to reduce or terminate any and all workers compensation benefits; provided, however, that the attorney s fees awarded to counsel who represent the employee in petitions for lump sum commutation filed pursuant to Rhode Island general laws Section 28-33-25 or in the settlement of disputed cases pursuant to Rhode Island general laws Section 28-33- 25.1 shall be limited to the maximum amount paid to counsel who serve as court appointed attorneys in workers compensation proceedings as established by rule or order of the Rhode Island supreme court. (e) In the event that the uninsured employer makes payment of any monies to the employee to compensate the employee for lost wages or medical expenses, the fund shall be entitled to a credit for all such monies received by or on behalf of the employee against any future benefits payable directly to the employee. (f) This section shall apply to injuries that occur on or after January 1, 2015 2016. 36-10-31. Deduction of amounts received from workers compensation or as damages. Any amount paid or payable under the provisions of any workers compensation law exclusive of Medicare set-aside allocations, specific compensation benefits or any benefits authorized by the terms of a collective bargaining agreement or as the result of any action for damages for personal injuries against the state of Rhode Island on account of the death or disability of a member shall be offset against and payable in lieu of any benefits payable out of funds provided by the state under the provisions of this chapter on account of the death or disability of the member. If the value of the total commuted benefits under any workers compensation law or action is less than the present value on an actuarial basis of the benefits otherwise payable under this chapter, the value of the commuted payments shall be deducted from the present value of the benefits and the balance thereof shall be payable under the provisions of this chapter. Note: HB 8282 is identical to SB 3053 Substitute A, which was also enacted on July 1, 2014. 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 3 of 10

BILLS PASSING SECOND CHAMBER The following bills passed the second chamber within the one-week period ending July 2, 2014. North Carolina HB 1034 was: Passed by the first chamber on June 12, 2014 Included in NCCI s June 27, 2014 Legislative Activity Report (RLA-2014-25) Amended and passed by the second chamber on June 26, 2014 HB 1034 amends various sections of the North Carolina General Statutes including, but not limited to, sections 58-87-10. Workers Compensation Fund for the benefit of volunteer safety workers and 97-2. Definitions as follows: 58-87-10. Workers Compensation Fund for the benefit of volunteer certain safety workers. (a) Definition. Definitions. As used in this section, the term following terms apply: (1) Eligible entity. One of the following entities that support eligible units and members of eligible units: a. North Carolina State Firemen s Association. b. The North Carolina Association of Fire Chiefs, Incorporated. c. North Carolina Association of Rescue and Emergency Medical Services, Inc. (2) eligible unit means a volunteer Eligible unit. A fire department or volunteer rescue/ems unit that (i) is not part of a unit of local government and (ii) is exempt from State income tax under G.S. 105-130.11. (b) Creation. The Workers Compensation Fund is created in the Department of Insurance as an expendable trust fund. Accordingly, interest and other investment income earned by the Fund accrues to it, and revenue in the Fund at the end of a fiscal year remains in the Fund and does not revert. (c) Use. Revenue in the Workers Compensation Fund shall be used to provide workers compensation benefits to (i) members of eligible units. units and (ii) the employees and volunteers of eligible entities. Chapter 97 of the General Statutes governs the payment of benefits from the Fund. Benefits are payable for compensable injuries or deaths that occur on or after July 1, 1996. (d) Administration. The State Fire and Rescue Commission, established under G.S. 58-78-1, shall administer the Workers Compensation Fund and shall perform this duty by contracting with a third-party administrator. The contracting procedure is not subject to Article 3C of Chapter 143 of the General Statutes. The reasonable and necessary expenses incurred by the Commission in administering the Fund shall be paid out of the Fund by the State Treasurer. The Commission may adopt rules to implement this section. (e) Revenue Source. Revenue is credited to the Workers Compensation Fund from a portion of the proceeds of the tax levied under G.S. 105-228.5(d)(3). In addition, every eligible unit and eligible entity that elects to participate shall pay into the Fund an amount set annually by the State Fire and Rescue Commission to ensure that the Fund will be able to meet its payment obligations under this section. The amount shall be set as a per capita fixed dollar an amount for each member of the roster of the eligible unit. unit or for each employee or volunteer of an eligible entity, and the amount may vary based on whether an individual is a volunteer, a part-time employee, or a full-time employee. The payment shall be made to the State Fire and Rescue Commission on or before July 1 of each year. The Commission shall remit the payments it receives to the State Treasurer, who shall credit the payments to the Fund. (f) (Effective until April 1, 2016) The amount of the tax imposed by G.S. 105-228.5(d)(3) credited to the Workers Compensation Fund shall be the maximum allowed under that statute. (f) (Effective April 1, 2016) Funding Study. The Department of Insurance shall annually conduct a periodic an actuarial study to that shall do all of the following: (1) calculate Calculate the amount required to meet the needs of the Fund. Fund, projecting at least five years into the future. The study shall be based on a revenue amount that is the greater of the amount paid by members of the Fund as determined under subsection (e) of this section for the fiscal year to which the study applies or the amount paid by members of the Fund as determined under subsection (e) of this section for fiscal year 2012 2013. (2) Report on the nature of the claims paid by the Fund and any claims-related trends that impact the financial status of the Fund. (3) Calculate how much revenue from the State and from member premiums would be required to meet the needs of the Fund for each of the following scenarios: a. The Fund receives twenty percent (20%) of the net proceeds from the tax collected under G.S. 105-228.5(d)(3). b. Member premiums do not change from the prior year. c. Member premiums fully fund the Fund without any State support. (4) Be published no later than February 1 of each year. Upon publishing the study, the Department shall notify the following of its publication: a. The Office of State Budget and Management. b. The House Appropriations Committee. c. The Senate Appropriations/Base Budget Committee. d. The Fiscal Research Division. Additionally, beginning in 2016 and every five years thereafter, the study shall include (i) a comparison of Fund premium levels to the premium levels of employees of municipal fire and rescue departments and (ii) a calculation of the amount of revenue generated by experience-rating premium surcharges and, if necessary, recommend changes to experience-rating premium surcharges given 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 4 of 10

claim trends. The Department may contract with a third party to conduct the study required under this section, and the cost of the study may be paid from the Fund. However, if the Department contracts with the same actuary that the Volunteer Safety Workers Compensation Board contracts with to perform the study under this section, then the Department shall not pay the actuary for data collection and analysis that the actuary has already performed as part of its loss reserve analysis for the Board. (g) Allocation of Taxes. The study conducted under subsection (f) of this section shall be reviewed by the Office of State Budget and Management. On or before March 1 of each year, the Office of State Budget and Management, in consultation with the Department of Insurance, must notify the Secretary of Revenue of the amount required to meet the needs of the Fund, as determined by the study, for the upcoming fiscal year. The Secretary of Revenue shall remit that amount, subject to the twenty percent (20%) limitation in G.S. 105-228.5(d)(3), to the Fund. 97-2. Definitions (5) Average Weekly Wages. Average weekly wages shall mean the earnings of the injured employee in the employment in which the employee was working at the time of the injury during the period of 52 weeks immediately preceding the date of the injury, including the subsistence allowance paid to veteran trainees by the United States government, provided the amount of said allowance shall be reported monthly by said trainee to the trainee s employer, divided by 52; but if the injured employee lost more than seven consecutive calendar days at one or more times during such period, although not in the same week, then the earnings for the remainder of such 52 weeks shall be divided by the number of weeks remaining after the time so lost has been deducted. Where the employment prior to the injury extended over a period of fewer than 52 weeks, the method of dividing the earnings during that period by the number of weeks and parts thereof during which the employee earned wages shall be followed; provided, results fair and just to both parties will be thereby obtained. Where, by reason of a shortness of time during which the employee has been in the employment of his employer or the casual nature or terms of his employment, it is impractical to compute the average weekly wages as above defined, regard shall be had to the average weekly amount which during the 52 weeks previous to the injury was being earned by a person of the same grade and character employed in the same class of employment in the same locality or community. In case of disabling injury or death to a volunteer fireman; firefighter; volunteer member of an organized rescue squad; an authorized pickup firefighter, as defined in subdivision (2) of this section, when that individual is engaged in emergency fire suppression activities for the North Carolina Forest Service; a duly appointed and sworn member of an auxiliary police department organized pursuant to G.S. 160A-282; or senior members of the State Civil Air Patrol functioning under Subpart C of Part 5 of Article 13 of Chapter 143B of the General Statutes, under compensable circumstances, compensation payable shall be calculated upon the average weekly wage the volunteer fireman, firefighter, volunteer member of an organized rescue squad, authorized pickup firefighter of the North Carolina Forest Service; when that individual is engaged in emergency fire suppression activities for the North Carolina Forest Service, member of an auxiliary police department, or senior member of the State Civil Air Patrol was earning in the employment wherein he principally earned his livelihood as of the date of injury. Provided, however, that the minimum compensation payable to a volunteer fireman, firefighter, volunteer member of an organized rescue squad, an authorized pickup firefighter of the North Carolina Forest Service of the Department of Agriculture and Consumer Services, when that individual is engaged in emergency fire suppression activities for the North Carolina Forest Service, a sworn member of an auxiliary police department organized pursuant to G.S. 160A-282, or senior members of the State Civil Air Patrol shall be sixty-six and two-thirds percent (66 2/3%) of the maximum weekly benefit established in G.S. 97-29. HB 1034 also includes the following language related to workers compensation third-party administrators: When renewing its existing contract with its third-party administrator, which contract expires on June 30, 2014, or contracting with a different third-party administrator, the State Fire and Rescue Commission shall, through its contract, require its workers compensation third-party administrator to do all of the following: (1) Establish a performance management system to set loss prevention goals and track and measure the effectiveness of loss prevention interventions. (2) Evaluate how additional data analytics software or cost models could help manage claim costs. (3) Determine the expenditures per department allocated to loss prevention services geared toward experience-rating reductions and compare the expenditures allocated per department to the experience-rating premium surcharges paid by each department. (4) Assess the different ways in which the Rating Modification Model could be adjusted to generate more revenue and incentivize departments to be more engaged in loss prevention services; and, if warranted, implement changes to the Experience Rating Modification Model based on the approval of the Volunteer Safety Workers Compensation Fund Board. (5) Track all legal claims and associated expenses open as of July 1, 2014, and filed thereafter, including information on the reasons each claim was filed and the conditions of the settlement or court ruling, and then share the information and analysis from the database with the Volunteer Safety Workers Compensation Fund Board at every quarterly board meeting. (6) Track suspected and confirmed fraudulent claims open as of July 1, 2014, and filed thereafter and then share the information and analysis from the database with the Volunteer Safety Workers Compensation Fund Board at every quarterly board meeting. (7) Track information for all claims awarded indemnity compensation affected by the minimum weekly compensation provision, as provided in G.S. 97-2(5), that are open on July 1, 2014, and filed on or after July 1, 2014. The database should include the following: a. The date of the volunteer s injury. 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 5 of 10

b. A detailed description of the injury. c. The volunteer s (paid) occupation, or status as a student or unemployed. d. The volunteer s weekly wages from his or her regular paid occupation. e. The amount of indemnity compensation awarded per week based on weekly wages from the regular, paid occupation. f. Whether the claim is affected by the minimum weekly compensation provision. g. The volunteer s post-injury return date to volunteer duties. (8) Report to the Volunteer Safety Workers Compensation Fund Board at every quarterly meeting on all claims awarded indemnity compensation affected by the minimum compensation provision. The report shall include the following: a. The total indemnity compensation awarded for each claim, as well as the compensation per week and the number of weeks of compensation. b. For each claim, the difference between the indemnity compensation awarded per week to the volunteer and the volunteer s weekly wages from his or her regular, paid occupation. c. For each claim, the difference between the total indemnity compensation awarded to the volunteer for number of weeks unable to return to volunteer duties and the volunteer s total wages from regular, paid occupation for the same time period. d. The total number of claims affected by the minimum weekly compensation provision (within a specified time period). e. The total workers indemnity compensation amount awarded for all claims affected by the minimum weekly compensation provision (within a specified time period). f. The difference between the total indemnity compensation awarded to volunteers and the total of all volunteers wages from their regular, paid occupations for the same time period (within a specific time period). (9) Track information for all claims awarded indemnity compensation in which a volunteer can return to his or her paid occupation but not his or her volunteer duty that are open on July 1, 2014, and filed on or after July 1, 2014. The database should include the following: a. Whether the volunteer has the ability to perform his or her paid occupation but not his or her volunteer duty. b. The volunteer s weekly wages from his or her regular, paid occupation. c. The amount of indemnity compensation awarded per week based on weekly wages from regular, paid occupation. d. The volunteer s post injury return date to volunteer duties. (10) Report to the Volunteer Safety Workers Compensation Fund Board at every quarterly meeting on the claims awarded indemnity compensation in which the volunteer can return to his or her paid occupation but not to his or her volunteer duty. The report shall include: a. The total number of claims where the volunteer is being awarded indemnity compensation when they can return to their regular, paid occupations (within a specified time period). b. The total indemnity compensation awarded for each claim, as well as the compensation per week and the number of weeks of compensation. c. The total indemnity compensation awarded for all claims (within a specified time period). (11) Include a form in the claims-closing material for volunteers who will not be able to return to their regular, paid occupations even though they can return to their volunteer duties, and track these claims and associated wages lost and prepare a report to share with the Volunteer Safety Workers Compensation Fund Board at every quarterly meeting. (12) Develop a model return-to-work program for use by fire and rescue departments that participate in the Fund and work with a limited number of departments to implement and test the program for a two-year time period. (13) Develop metrics by which to determine if the return-to-work program reduces workers compensation costs. By January 1, 2015, the State Fire and Rescue Commission shall report to the Fiscal Research Division, the House Appropriations Subcommittee on General Government, and the Senate Appropriations Committee on General Government and Information Technology on the status of the Commission s data collection and analysis efforts and shall include in the report a copy of the State Fire and Rescue Commission s contract with the third-party administrator. The State Fire and Rescue Commission shall include the provisions of this subsection in all future contracts with its workers compensation third-party administrators. SB 794 was: Passed by the first chamber on June 19, 2014 Included in NCCI s July 4, 2014 Legislative Activity Report (RLA-2014-26) Amended and passed by the second chamber on July 2, 2014 SB 794, in part, amends sections 97-25. Medical treatment and supplies and 97-78. Salaries and expenses; administrator, executive secretary, deputy commissioners, and other staff assistance; annual report of the North Carolina General Statutes as follows: 97-25. Medical treatment and supplies. (f) In claims subject to G.S. 97-18(b) and (d), a party may file an expedited, emergency, or other medical motion with the Office of the Chief Deputy Commissioner. The nonmoving party shall have the right to contest the motion. Motions and responses shall be submitted via electronic mail to the Commission, the opposing party and the opposing party s attorney, simultaneously. The 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 6 of 10

Commission shall conduct an informal telephonic pretrial conference to determine if the motion warrants an expedited or emergency hearing. If the Commission determines that the motion does not warrant an expedited or emergency hearing, the motion shall be decided administratively within 60 days of the date the motion was filed pursuant to rules governing motions practices in contested cases. If the Commission determines that any party has acted unreasonably by initiating or objecting to a medical motion, the Commission may assess costs associated with any proceeding, including reasonable attorneys fees and deposition costs, against the offending party. (g) If the Commission determines that a medical motion should be expedited, each party shall be afforded an opportunity to state its position and to submit documentary evidence at an informal telephonic hearing. The medical motion shall contain documentation and support of the request, including the most relevant medical records and a representation that informal means of resolving the issue have been attempted in good faith, and the opposing parties position, if known. The Commission shall determine whether deposition testimony of medical and other experts is necessary and if so shall order that the testimony be taken within 35 days of the date the motion is filed. For good cause shown, the Commission may reduce or enlarge the time to complete depositions of medical and other experts. Transcripts of depositions shall be expedited and paid for by the administrator, carrier, or employer. Transcripts shall be submitted electronically to the Commission within 40 days of the date the motion is filed unless the Commission has reduced or enlarged the time to complete the depositions. The Commission shall render a decision on the motion within five days of the date transcripts are due to the Commission. (h) If the Commission determines that a medical motion is an emergency, the Commission shall make a determination on the motion within five days of receipt by the Commission of the medical motion. Motions requesting emergency medical relief shall contain the following: a motion as set forth in this subsection regarding a request for medical compensation or a dispute involving medical issues. The nonmoving party shall have the right to contest the motion. Motions and responses shall be submitted contemporaneously via electronic mail to the Commission and to the opposing party or the opposing party s attorney. (1) A party may file a motion with the Executive Secretary for an administrative ruling regarding a request for medical compensation or a dispute involving medical issues. The motion shall be decided administratively pursuant to rules governing motions practices in contested cases. The Commission shall decide the motion within 30 days of the filing of the motion unless an extension of time to respond to the motion has been granted for good cause shown. Either party may file a motion for reconsideration of the administrative order with the Executive Secretary. Either party may request an expedited formal hearing pursuant to G.S. 97-84 and subdivision (2) of this subsection to appeal the decision of the Executive Secretary approving or denying the original motion or the motion for reconsideration. Within five days of the filing of a request for an expedited formal hearing pursuant to G.S. 97-84 and subdivision (2) of this subsection to appeal the decision of the Executive Secretary, the Commission shall assign a Deputy Commissioner to conduct the formal hearing. The decision shall not be stayed during the pendency of an appeal pursuant to G.S. 97-84 and subdivision (2) of this subsection except under those circumstances set out in subdivision (4) of this subsection. A motion to stay shall be filed with the Deputy Commissioner scheduled to conduct the formal hearing pursuant to G.S. 97-84. Either party may appeal the decision of the Deputy Commissioner pursuant to G.S. 97-84 to the Full Commission pursuant to G.S. 97-85. The decision of the Deputy Commissioner shall not be stayed during the pendency of an appeal except under those circumstances set out in subdivision (4) of this subsection. A motion to stay the decision of the Deputy Commissioner pursuant to G.S. 97-84 shall be directed to the Chair of the Commission. The Full Commission shall render a decision on the appeal of the Deputy Commissioner s decision on the motion within 60 days of the filing of the notice of appeal. (2) In lieu of filing a motion with the Executive Secretary for an administrative ruling pursuant to subdivision (1) of this subsection, when appealing a ruling made pursuant to subdivision (1) of this subsection or when appealing an administrative ruling of the Chief Deputy or the Chief Deputy s designee on an emergency motion, a party may request a full evidentiary hearing pursuant to G.S. 97-84 on an expedited basis, limited to a request for medical compensation or a dispute involving medical issues, by filing a motion with the Office of the Chief Deputy Commissioner. The case will not be ordered into mediation based upon a party s request for hearing on the motion or appeal under this subdivision, except upon the consent of the parties. The Commission shall set the date of the expedited hearing, which shall be held within 30 days of the filing of the motion or appeal and shall notify the parties of the time and place of the hearing on the motion or appeal. Upon request, the Commission may order expedited discovery. The record shall be closed within 60 days of the filing of the motion, or in the case of an appeal pursuant to subdivisions (1) and (3) of this subsection, within 60 days of the filing of the appeal, unless the parties agree otherwise or the Commission so orders. Transcripts of depositions shall be expedited if necessary and paid pursuant to rules promulgated by the Commission related to depositions and shall be submitted electronically to the Commission. The Commission shall decide the issue in dispute and make findings of fact based upon the preponderance of the evidence in view of the entire record. The award, together with a statement of the findings of fact, rulings of law, and other matters pertinent to the questions at issue shall be filed with the record of the proceedings within 15 days of the close of the hearing record, and a copy of the award shall immediately be sent to the parties. Either party may appeal the decision of the Deputy Commissioner pursuant to G.S. 97-84 to the Full Commission pursuant to G.S. 97-85. The decision of the Deputy Commissioner pursuant to G.S. 97-84 shall not be stayed during the pendency of an appeal except under those circumstances set out in subdivision (4) of this subsection. A motion to stay the decision of the Deputy Commissioner pursuant to G.S. 97-84 shall be directed to the Chair of the Commission. The Full Commission shall render a decision on the appeal of the Deputy Commissioner s decision on the motion within 60 days of the filing of the notice of appeal. (3) An emergency medical motion filed by either party shall be filed with the Office of the Chief Deputy Commissioner. The Chief Deputy or Chief Deputy s designee shall rule on the motion within five days of receipt unless the Chief Deputy or Chief Deputy s designee determines that the motion is not an emergency, in which case the motion shall be referred to the Executive Secretary for an administrative ruling pursuant to subdivision (1) of this subsection. Motions requesting emergency medical relief shall contain all of 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 7 of 10

the following: (1) a. An explanation of the medical diagnosis and treatment recommendation of the health care provider that requires emergency attention. (2) b. A specific statement detailing the time-sensitive nature of the request to include relevant dates and the potential for adverse consequences to the employee movant if the recommended treatment relief is not provided emergently. (3) c. An explanation of opinions known and in the possession of the employee movant of additional medical or other relevant experts, independent medical examiners, and second opinion examiners. (4) d. Documentation known and in the possession of the employee movant in support of the request, including relevant medical records. (5) e. A representation that informal means of resolving the issue have been attempted. Either party may appeal the decision of the Chief Deputy or the Chief Deputy s designee on the emergency motion by requesting an expedited formal hearing pursuant to G.S. 97-84 and subdivision (2) of this subsection to appeal the administrative decision of the Chief Deputy or the Chief Deputy s designee on the emergency motion. Within five days of the filing of a request for an expedited formal hearing pursuant to G.S. 97-84 and subdivision (2) of this subsection, the Commission shall assign a Deputy Commissioner to conduct the formal hearing. The decision of the Chief Deputy or the Chief Deputy s designee shall not be stayed during the pendency of an appeal of the administrative decision except under those circumstances set out in subdivision (4) of this subsection. Any motion to stay shall be filed with the Deputy Commissioner scheduled to conduct the expedited formal hearing pursuant to G.S. 97-84 and subdivision (2) of this subsection. Either party may appeal the decision of the Deputy Commissioner pursuant to G.S. 97-84 to the Full Commission pursuant to G.S. 97-85. If so, the decision of the Deputy Commissioner shall not be stayed during the pendency of an appeal except under those circumstances set out in subdivision (4) of this subsection. Any motion to stay the decision of the Deputy Commissioner pursuant to G.S. 97-84 shall be directed to the Chair of the Commission. The Full Commission shall render a decision on the appeal of the Deputy Commissioner s decision on the motion within 60 days of the filing of the notice of appeal. (4) The Commission shall consider, among other factors, all of the following when determining whether to grant a motion to stay filed pursuant to this subsection: a. Whether there would be immediate and irreparable injury, harm, loss, or damage to either party. b. The nature and cost of the medical relief sought. c. The risk for further injury or disability to the employee inherent in the treatment or its delay. d. Whether it has been recommended by an authorized physician. e. Whether alternative therapeutic modalities are available and reasonable. (5) If the Commission determines that any party has acted unreasonably by initiating or objecting to a motion filed pursuant to this section, the Commission may assess costs associated with any proceeding, including any reasonable attorneys fees and deposition costs, against the offending party. 97-78(g)(2). Salaries and expenses; administrator, executive secretary, deputy commissioners, and other staff assistance; annual report (2) The total number of requests for, and disputes involving, medical compensation under G.S. 97-25 in which final disposition was not made within 45 75 days of the filing of the motion with the Commission, and, for each such request or dispute, the date the motion or other initial pleading was filed, the date on which final disposition was made and, where reasonably ascertainable, the date on which any ordered medical treatment was actually provided. SB 794 also disapproves the following rules adopted by the North Carolina Industrial Commission: 04 NCAC 10A.0605 (Discovery) 04 NCAC 10A.0701 (Review by the Full Commission) 04 NCAC 10C.0109 (Vocational Rehabilitation Services and Return to Work) 04 NCAC 10E.0203 (Fees Set by the Commission) 04 NCAC 10L.0101 (Form 21 Agreement for Compensation for Disability) 04 NCAC 10L.0102 (Form 26 Supplemental Agreement as to Payment of Compensation) 04 NCAC 10L.0103 (Form 26A Employer s Admission of Employee s Rights to Permanent Partial Disability) 04 NCAC 10A.0609A (Medical Motions and Emergency Medical Motions) 04 NCAC 10A.0202 (Hearing Costs or Fees) 04 NCAC 10A.0702 (REVIEW OF ADMINISTRATIVE DECISIONS) In addition, SB 794 requires the Industrial Commission to amend and readopt the above disapproved rules as follows: (1) With regard to 04 NCAC 10A.0605 (Discovery), the Commission shall amend subsection (6) of the rule by deleting the following sentence: Until a matter is calendared for a hearing, parties may serve requests for production of documents without leave of the Commission and by inserting the following sentence: The parties may serve requests for production of documents without leave of the Commission until 35 days prior to the date of hearing ; and by changing the word shall to may in subsection (7) of the rule. (2) With regard to 04 NCAC 10A.0609A (Medical Motions and Emergency Medical Motions), the Commission shall amend 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 8 of 10

subsection (a) of the rule by adding the word either between the word before and the ; adding the phrase or the Executive Secretary after the word Commissioner ; changing the word simultaneously to contemporaneously ; and changing the word and that appears between the words party and opposing to or. Subsection (b) of the rule shall be amended by deleting the phrase Once notification has been received by the parties that a medical motion has been assigned to a Deputy Commissioner, subsequent ; adding the word Subsequent before the word filings ; adding the word electronically between the words submitted and directly ; and adding the phrase either the Executive Secretary or between the words to and the. The Commission shall amend subsection (c) of the rule by deleting the sentence Upon receipt of a medical motion, carriers, third-party administrators, and employers shall immediately send notification of the name, email address, telephone number and fax number of the attorney appearing on their behalf to medicalmotions@ic.nc.gov. and deleting the word also from the subsection. The Commission shall amend subsection (d)(2) of the rule by substituting the word employee for the word claimant throughout. The Commission shall amend subsection (d)(6) of the rule by substituting the following phrase if an attorney has been retained for the employer or carrier, the attorney s for the phrase the counsel for employer and carrier s. The Commission shall amend subsection (d)(8) of the rule by adding the word the between the words of and claimant ; by substituting the word employee for claimant ; by deleting the phrase and the treatment recommendation ; by adding the word the between the words and and name ; and by substituting the word any for the word the that appears between the words of and health. The Commission shall add the phrase, if any after the word request in subsection (d)(10) of the rule. The Commission shall amend subsection (d)(11) of the rule by substituting the word movant for the word employee ; and by substituting the phrase of additional medical or other with the phrase by any. In subsection (d)(12) of the rule, the Commission shall substitute the word employee for plaintiff. The Commission shall substitute the word employee for the word claimant throughout subsection (e)(2) of the rule. The Commission shall amend subsection (e)(3) of the rule by adding the phrase, if known after the word code. The Commission shall amend subsection (e)(8) of the rule by substituting the word relief for the word treatment. The Commission shall amend subsection (e)(9) of the rule by substituting the word movant for the word employee ; and substituting the phrase of additional medical or other with the phrase by any. The Commission shall amend subsection (e)(11) of the rule by substituting the word documents for the word documentation ; and substituting the phrase employee in support of with the phrase movant relevant to. The Commission shall amend the rule by deleting subsections (f), (g), and (i) of the rule; former subsection (j) of the rule shall become new subsection (f) of the rule; former subsection (k) of the rule shall become new subsection (i) of the rule. The Commission shall amend subsection (h) of the rule by deleting the phrase deemed necessary by the Deputy Commissioner ; by adding the phrase pursuant to G.S. 97-25 between the words order and within ; and by deleting the phrase within 35 days of the date the motion is filed. Transcripts of depositions shall be submitted electronically to the Commission within 40 days of the date of the filing of the motion ; and by adding the phrase or upon agreement of the parties after the phrase for good cause shown. The Commission shall amend the rule by adding a new subsection (g) that shall read as follows: (g) A party may appeal an order of the Executive Secretary on a motion brought pursuant to G.S. 97-25(f)(1) or receipt of a ruling on a motion to reconsider filed pursuant to Rule.0702(b) of the Subchapter by giving notice of appeal to the Docket Section within 15 calendar days. A letter expressing an intent to appeal a decision of the Executive Secretary shall be considered a request for an expedited hearing pursuant to G.S. 97-25 and G.S. 97-84. The letter shall specifically identify the order from which appeal is taken. After receipt of a notice of appeal, the appeal shall be assigned to a Deputy Commissioner by the Docket Section, and an order under the name of the Deputy Commissioner to which the appeal is assigned shall be issued within three days of receipt of the notice of appeal. The Commission shall amend the rule by adding a new subsection (j) that shall read as follows: (j) A party may appeal the administrative decision of the Chief Deputy or the Chief Deputy s designee filed pursuant to G.S. 97-25(f)(3) by giving notice of appeal to the Docket Section within 15 calendar days of receipt of the Order. A letter expressing an intent to appeal the Chair or the Chair s designee s Order filed pursuant to G.S. 97-25(f)(3) shall be considered a notice of appeal, provided that the letter specifically identifies the Order from which appeal is taken. After receipt of notice of appeal, the appeal shall be acknowledged by the Docket Section within three days by sending an Order under the name of the Deputy Commissioner to which the appeal is assigned. The appeal of the administrative decision of the Chair or the Chair s designee shall be subject to G.S. 97-25(f)(2) and G.S 97-84. The Commission shall amend new subsection (i) of the rule by substituting the phrase the decision of a Deputy Commissioner, Chief Deputy, or Chief Deputy s designee filed for the phrase a Deputy Commissioner s Order on a motion brought ; by adding the phrase (f)(2) between the words G.S. 97-25 and by ; by deleting the phrase or receipt of the ruling on a Motion to Reconsider the Order filed pursuant to Rule.0702(b) of this Subchapter ; by substituting the word filed for the phrase on a motion brought ; by substituting the phrase briefs and set the schedule for filing. for the phrase briefs and the schedule for filing them. At the time the motion is set for informal hearing, the Chair of the Panel shall also indicate to the parties if oral arguments are to be by telephone, in person, or waived. ; and by adding A Full Commission hearing on an appeal of a medical motion filed pursuant to G.S. 97-25(f)(1), 97-25(f)(2), and 97-25(f)(3) shall be held telephonically and shall not be recorded unless unusual circumstances arise and the Commission so orders. (3) With regard to 04 NCAC 10A.701 (Review by the Full Commission), the Commission shall amend subsection (b) of the rule by inserting the sentences Parties represented by counsel shall sign a joint certification acknowledging receipt of the Form 44 Application for Review and the official transcript and exhibits and submit the certification within ten days of receipt of the Form 44 Application for Review and the official transcript and exhibits. The certification shall stipulate the date the Form 44 Application for Review and the official transcript and exhibits were received by the parties and shall note the date the appellant s brief is due. after the sentence that reads The e-mail shall also provide instructions for the submission of the parties acknowledgement of receipt of the Form 44 Application for Review and the official transcript and exhibits to the Commission. 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 9 of 10

(4) With regard to 04 NCAC 10C.0109 (Vocational Rehabilitation Services and Return to Work), the Commission shall amend subsection (b) of the rule by deleting the phrase only toward prospective employers offering the opportunity for suitable employment. The Commission shall change the word shall to should in subsection (c) of the rule. The Commission shall change subsection (d)(3) of the rule by substituting the phrase the likely duration until completion of the requested retraining or education, the number of credits needed to complete the retraining or education, the course names and schedules for the retraining or education, and which courses are available on-line versus in person for the phrase the likely duration until completion of the requested retraining or education and the likely class schedules, class attendance requirements, and out-of-class time required for homework and study. The Commission shall substitute the phrase initiate or continue placement activities for the phrase place the worker in suitable employment within subsection (j) of the rule. (5) With regard to 04 NCAC 10E.0202 (Hearing Costs), the Commission shall amend subsection (a) of the rule to insert the following phrase other than workers compensation cases after the word Commission effective July 1, 2015. The Commission shall amend the rule by deleting the following sentence from subsection (a) of the rule effective July 1, 2015: In workers compensation cases, these fees shall be paid by the employer unless the Commission orders otherwise, except as specified in subsection (2) above. (6) With regard to 04 NCAC 10E.0203 (Fees Set by the Commission), the Commission shall delete subsection (a)(2) of the rule effective July 1, 2015. (7) With regard to 04 NCAC 10L.0101 (Form 21 Agreement for Compensation for Disability), 04 NCAC 10L.0102 (Form 26 Supplemental Agreement as to Payment of Compensation), and 04 NCAC 10L.0103 (Form 26A Employer s Admission of Employee s Rights to Permanent Partial Disability), the Commission shall delete any references to fees for processing agreements and the party responsible for payment of fees effective July 1, 2015. (8) With regard to 04 NCAC 10A.0702 (REVIEW OF ADMINISTRATIVE DECISIONS), the Commission shall amend the rule by striking subdivision (3) from subsection (a); by renumbering existing subdivisions (a)(4) and (a)(5) as new subdivisions (a)(3) and (a)(4) respectively; and by adding a new subsection (e) that reads, This rule shall not apply to medical motions filed pursuant to G.S. 97-25; provided, however, that a party may request reconsideration of an administrative ruling on a medical motion, or may request a stay, or may request an evidentiary hearing de novo, all as set forth in G.S. 97-25. BILLS PASSING FIRST CHAMBER There were no bills that passed the first chamber within the one-week period ending July 2, 2014. Contact Information If you have any questions about the legislation or proposals mentioned, please contact the appropriate NCCI state relations executive (listed below) or a representative of your local insurance trade association. State State Relations Executive Phone Number CT, ME, NH, RI,VT Laura Backus Hall 802-454-1800 FL, IA Chris Bailey 850-322-4047 AL, GA, KY, LA, MS Cathy Booth 205-655-2699 AZ, CO, NM, NV, UT Maggie Karpuk 818-707-8374 DC, MD, VA, WV David Benedict 804-380-3005 AK, HI Carolyn Pearl 808-524-6239 IN, NC, SC, TN Amy Quinn 803-356-0851 AR, IL, NE, TX Terri Robinson 501-333-2835 ID, MT, OR Mike Taylor 503-892-1858 KS, MO, OK, SD Roy Wood 314-843-4001 Federal Issues Tim Tucker 202-403-8526 This report is informational and is not intended to provide an interpretation of state and federal legislation. 2014 National Council on Compensation Insurance, Inc. All Rights Reserved. Page 10 of 10