Enrolled Bill Summary

            House Bill 2600 amends numerous Labor Code provisions relating to the workers' compensation system in this state, changes the sunset date of the Texas Workers' Compensation Commission from September 1, 2007, to September 1, 2005, and subjects certain aspects of the commission's operation to audit by the state auditor.

            The bill introduces a registration and certification system for a doctor to be included on the list of doctors approved to provide health care under the workers' compensation system, and it requires the commission to establish specific requirements and to issue certificates of registration to approved doctors. The bill sets forth additional circumstances under which a listed doctor may be deleted from and reinstated to the list as well as sanctions that may be imposed on a doctor for violations of workers' compensation laws. The bill authorizes the commission to contract with a health care provider professional review organization, and it requires the commission to employ or contract with a medical advisor to make recommendations, in conjunction with a medical quality review panel, regarding rules concerning medical policies, impairment ratings, and the performance of approved doctors.

            The bill provides for the creation of fee-for-service regional health care delivery networks to deliver health care under the workers' compensation system, as well as an advisory committee consisting of representatives of labor, employers, insurance carriers, health care providers, and actuaries to advise the commission on the implementation of and standards for the networks. The bill calls for the development of a regional network report card to assess the networks' performance in areas including access to care, return-to-work and health-related outcomes, cost, and satisfaction. The cost of evaluating the regional networks will be funded through the subsequent injury fund and may not exceed $1.5 million. The bill sets forth the circumstances under which an insurance carrier or self-insurer may elect to participate in a regional network, requires certain public employers to participate in a network, lays out detailed procedures relating to an employee's election to participate in a network, prohibits adverse employment actions against an employee who elects not to participate, and sets forth conditions for reimbursement for services delivered by both network and non-network health care providers. The bill allows insurance carriers to participate concurrently in an insurance carrier network and a regional network.

            House Bill 2600 requires an employer to inform the employee, the employee's doctor, and the insurance carrier about return-to-work programs available through the employer, and it requires insurance carriers to provide employers with return-to-work coordination services.

            The bill eliminates specific references to spinal surgery second opinion requirements, and it includes spinal surgery as a procedure requiring preauthorization, along with certain work-hardening or work-conditioning services, inpatient hospitalization, outpatient surgical services, and investigational or experimental services or devices. The bill specifically authorizes insurance carriers and health care providers to voluntarily discuss an employee's treatment.

            The bill requires insurance carriers to pay for certain pharmaceutical services for the first seven days after an employee's injury, and it allows the carrier to be reimbursed from the subsequent injury fund if the injury is determined not to be compensable. The bill requires the commission to develop an open formulary that requires the use of generic medications and over-the-counter alternatives to prescription medications and requires a physician to order such alternatives when appropriate.

            The bill alters the method for obtaining medical examinations for injured employees. Examinations ordered to resolve questions about appropriateness of health care will still be administered by a doctor selected by an insurance carrier, but examinations conducted to determine the impairment and attainment of maximum medical improvement or to resolve a dispute about an impairment rating are to be conducted by a qualified designated doctor on the commission's list. The bill also provides for distribution and confidentiality of medical records for such examinations and restricts communication with the doctor to avoid undue influence.

            House Bill 2600 requires the commission to adopt the most current reimbursement methodologies, models, and values or weights used by the federal Health Care Financing Administration to achieve standardization in its health care reimbursement policies and guidelines. The bill specifically provides that it does not require the adoption of the Medicare fee schedule, but it requires the commission to determine appropriate fees using conversion factors that take into account economic indicators in health care and other existing guidelines. The bill makes the adoption of treatment guidelines by the commission optional rather than mandatory, but it requires any treatment guideline adopted to be nationally recognized, scientifically valid, and outcome-based. The bill authorizes an insurance carrier to contract with a separate entity to handle payments for medical services.

            The bill entitles a claimant to review of a medical service for which the health care provider sought preauthorization and was denied by the insurance carrier, sets forth the roles of the commission and an independent review organization in resolving the dispute, and authorizes a party to such a dispute who has exhausted administrative remedies to seek judicial review of the decision.

            The bill requires each health care practitioner or approved doctor to disclose any financial interests in other health care providers; allows for administrative penalties against insurance carriers or health care providers for repeated violations of applicable law, rules, orders, or decisions of the commission; requires the commission to adopt a schedule of specific monetary administrative penalties; and authorizes the commission to refer administrative violations to the appropriate licensing authorities for disciplinary action. Insurance carriers that seek judicial review of a commission decision relating to income or death benefits are made liable for all or part of a claimant's attorney's fees.

            Finally, House Bill 2600 makes a number of changes relating to benefits of, funding for, and administration of the workers' compensation system, as follows:

• An employee who suffers certain severe burns is eligible for lifetime income benefits.
• If funding for the subsequent injury fund is not adequate, it is to be supplemented by a maintenance tax on insurance carriers adequate to provide 120 percent of the projected unfunded liabilities of the fund for the next biennium.
• Procedures for computing the average weekly wage of employees with multiple employment and school district employees are set forth for the purpose of determining income benefits and death benefits.
• An insurance carrier involved in a contested case hearing must provide the hearing officer and the claimant a document stating the carrier's true corporate name and the name and address of the agent for service of process and requires that information to be included in a final decision of an appeals panel.
• Saturdays, Sundays, and certain holidays are excluded from computations of appeal filing deadlines.
• The commission must deliver a study of drug-free workplace policies and the effect of drug abuse on the workers' compensation system no later than February 1, 2003.
• The State Office of Risk Management is required to establish a risk reward program for state agency workers' compensation claims.
• Certain peace officers are included under the state's workers' compensation system.
• Certain state employees are authorized to use accrued sick and vacation leave before receiving income benefits.
• The commission must use the treasury constant maturity rate for one-year treasury bills to compute its interest and discount rate.
• A waiver of a cause of action against an uninsured employer to recover damages for an employee's personal injuries or death is prohibited.