SRC-HRD H.B. 3137 75(R)BILL ANALYSIS
Senate Research CenterH.B. 3137
By: Solomons (Armbrister)
Economic Development
5-16-97
Committee Report (Amended)
DIGEST
Chapter 410 of the Labor Code currently allows insurance carriers engaged
in a workers' compensation lawsuit to settle their case and then claim
that the settlement agreement reverses or modifies an appeals panel
decision awarding benefits. Carriers also use judgments based on default
or on an agreement of the parties to accomplish the same end.
Additionally, carriers sometimes attempt to use these settlement
agreements and judgments to seek reimbursement through the Subsequent
Injury Fund for any benefits they may have provided to a claimant. This
proposed legislation prevents both of these practices. It also applies
some of the Section 410.256 requirements with regard to court approval of
settlements to a new Section 410.257 on court approval of judgments.
Finally, this proposed legislation would make any judgment entered or
settlement approved without complying with Sections 410.256, 410.257, or
410.258 void. This places the burden of compliance with these provisions
on the litigating parties rather than the Texas Workers' Compensation
Commission (commission).
H.B. 3137 would prevent the use of settlement agreements, and judgments
based on default or on an agreement of the parties, to overturn appeals
panel decisions. H.B. 3137 would also prevent carriers from using these
types of judgments and settlements to seek reimbursement from the
subsequent injury fund for benefit payments made to a claimant. This bill
ensures that the commission has notice and an opportunity to intervene in
a workers' compensation lawsuit to explain why a judgment or settlement
should not be approved by a court.
PURPOSE
As proposed, H.B. 3137 prevents the use of settlement agreements, and
judgments based on default or on an agreement of the parties, to overturn
appeals panel decisions. H.B. 3137 also prevents carriers from using
these types of judgments and settlements to seek reimbursement from the
subsequent injury fund for benefit payments made to a claimant. H.B. 3137
also ensures that the Texas Workers' Compensation Commission has notice
and an opportunity to intervene in a workers' compensation lawsuit to
explain why a judgment or settlement should not be approved by a court.
RULEMAKING AUTHORITY
This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 410.256, Labor Code, to prohibit a claim or
issue from being settled contrary to the provisions of an appeals panel
decision issued on the claim or issue unless a party to the proceeding has
filed for judicial review under this subchapter or Subchapter G. Provides
that settlement of a claim or issue under this section does not constitute
a modification or reversal of the appeals panel decision awarding benefits
for the purpose of Section 410.205. Requires settlement of a claim or
issue to be in compliance with all appropriate provisions of the law,
including this section and Section 410.258 of this subchapter. Provides
that a settlement which on its face does not comply with this section is
void. Makes conforming changes.
SECTION 2. Amends Chapter 410F, Labor Code, by adding Sections 410.257 and
410.258, as follows:
Sec. 410.257. JUDGMENT AFTER JUDICIAL REVIEW. Requires a judgment
entered by a court on judicial review of an appeals panel decision under
this subchapter or Subchapter G to comply with all appropriate provisions
of the law. Prohibits a judgment under this section from providing for
certain payment or limitation or termination. Prohibits a judgment that
resolves an issue of impairment from being entered before the date the
claimant reaches maximum medical improvement. Requires the judgment to
adopt an impairment rating under Chapter 408G, except to the extent
Section 410.307 applies. Prohibits a judgment under this section from
ordering reimbursement from the subsequent injury fund. Provides that a
judgment under this section based on default or on an agreement of the
parties does not constitute a modification or reversal of an appeals panel
decision awarding benefits for the purpose of Section 410.205. Provides
that a judgment that on its face does not comply with this section is
void.
Sec. 410.258. NOTIFICATION OF COMMISSION OF PROPOSED JUDGMENTS AND
SETTLEMENTS; RIGHT TO INTERVENE. Sets forth requirements regarding the
party who initiated a proceeding under this subchapter or Subchapter G.
Sets forth provisions regarding the proposed judgment or settlement.
Authorizes the Texas Workers' Compensation Commission (commission) to
intervene in a proceeding under Subsection (a) not later than the 30th day
after the date of receipt of the proposed judgment or settlement. Sets
forth requirements and provisions for the commission regarding review of
the proposed judgment or settlement. Sets forth provisions applicable if
the commission does not intervene before the 31st day after the date of
receipt of the proposed judgment or settlement. Sets forth provisions
applicable if the commission intervenes in the proceeding. Provides that
a judgment entered or settlement approved without complying with the
requirements of this section is void.
SECTION 3. Effective date: September 1, 1997.
Makes application of this Act prospective.
SECTION 4. Emergency clause.
Effective date: upon passage.
SUMMARY OF COMMITTEE CHANGES
Amendment 1.
Page 2, line 18, replace "Section 410.259" with "Section 410.258".