1-1 AN ACT
1-2 relating to rate administration of workers' compensation insurance
1-3 policies.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Article 5.58, Insurance Code, is amended to read
1-6 as follows:
1-7 Art. 5.58. RATE ADMINISTRATION FOR WORKERS' COMPENSATION
1-8 INSURANCE POLICIES; CLAIMS REPORTS. (a) Recording and Reporting
1-9 of Loss Experience and Other Data. The commissioner [Board] shall
1-10 develop reasonable statistical plans, which may be modified from
1-11 time to time and which shall be used thereafter by each insurer in
1-12 the recording and reporting of its loss experience and such other
1-13 data as may be required, in order that the total loss and expense
1-14 experience of all insurers may be made available at least annually
1-15 in such form and detail as may be necessary to aid in determining
1-16 whether rates meet the standards imposed under Section 2, Article
1-17 5.55 of this code. If the commissioner [Board] determines that any
1-18 insurer's rates do not meet those standards, the commissioner
1-19 [Board] may order the insurer to adjust its rates to meet those
1-20 standards. An [A Board] order of the commissioner under this
1-21 article may be appealed under Article 1.04 of this code. The
1-22 commissioner [Board] may designate or [not] contract with a
1-23 qualified organization to serve as the statistical agent for the
1-24 commissioner under this article as provided by Article 21.69 of
2-1 this code. The statistical agent [or designate an insurer or
2-2 advisory organization to gather or compile data for statistical
2-3 plans; however, an insurer] may provide to one or more advisory
2-4 organizations the information provided by the statistical agent
2-5 [insurer] to the commissioner [Board] under this article.
2-6 (b) Standards and Procedures. For purposes of Subsection (c)
2-7 of this article, the commissioner [Board] shall establish standards
2-8 and procedures for categorizing insurance and medical benefits
2-9 reported on each workers' compensation claim. The commissioner
2-10 [Board] shall consult with the Texas Workers' Compensation
2-11 Commission and the [Texas Workers' Compensation] Research and
2-12 Oversight Council on Workers' Compensation [Center] in establishing
2-13 these standards to ensure that the data collection methodology
2-14 will also yield data necessary for research and medical cost
2-15 containment efforts.
2-16 (c) Content of Detailed Claim Information [Unit Statistical
2-17 Data] Reports. The following information shall be reported on each
2-18 workers' compensation claim:
2-19 (1) the hazard classification of the affected
2-20 employee;
2-21 (2) the date of injury;
2-22 (3) the social security number of the claimant;
2-23 (4) the severity classification of the claim,
2-24 including separate classifications for claims in which death
2-25 benefits are paid, claims in which lifetime income benefits are
2-26 paid, claims in which only temporary income benefits are paid,
2-27 claims in which impairment benefits are paid, claims in which
3-1 supplemental benefits are paid, and claims in which only medical
3-2 benefits are paid;
3-3 (5) the amount paid in periodic payments;
3-4 (6) the amount paid in lump-sum payments;
3-5 (7) the amount paid for temporary income benefits;
3-6 (8) the amount paid for impairment income benefits;
3-7 (9) the amount paid for supplemental income benefits;
3-8 (10) the amount paid for death and burial benefits;
3-9 (11) the total amount paid for income, death, or
3-10 burial benefits;
3-11 (12) the total amount of incurred losses for income,
3-12 death, or burial benefits;
3-13 (13) the amount paid to doctors and other health care
3-14 providers;
3-15 (14) the amount paid to hospitals and other health
3-16 care facilities;
3-17 (15) the total amount paid for medical benefits;
3-18 (16) the total amount of incurred losses for medical
3-19 benefits; and
3-20 (17) other information required by the commissioner
3-21 [Board].
3-22 (d) Information Confidential. A person may not distribute
3-23 or otherwise disclose a social security number or any other
3-24 information collected under Subsection (c) of this article which
3-25 would disclose the identity of any claimant.
3-26 (e) Payments Excluded From Rates. In any statistical plan
3-27 developed by the commissioner [Board], direct expenditures by an
4-1 insurer to influence public policy and any amounts paid by an
4-2 insurer as damages in a suit against the insurer for malice or bad
4-3 faith or as fines or penalties shall be reported separately, and
4-4 the expenditures and payments shall not be considered as a loss or
4-5 expense for the calculation of any premium rate modifier or
4-6 surcharge of an insured.
4-7 (f) Transmission of Claims [Statistical] Reports. The
4-8 claims [statistical] reports filed under Subsection (c) of this
4-9 article shall be updated by each insurer and transmitted to the
4-10 commissioner or the commissioner's statistical agent [Board] in
4-11 accordance with the filing requirements of the commissioner's
4-12 [Board's] statistical plan. Each insurer writing at least
4-13 one-half of one percent of the workers' compensation insurance in
4-14 this state shall report its data in a compatible electronic format
4-15 prescribed by the commissioner [Board]. The commissioner [Board]
4-16 shall take necessary measures to ensure the accuracy of the data
4-17 and the adequacy of the format for data reported in an electronic
4-18 format.
4-19 (g) Reports of Aggregate Data. The commissioner [Board] may
4-20 permit the information required by Subsection (c) of this article
4-21 to be reported in the aggregate for each risk for claims in which
4-22 benefit payments are less than $5,000. The commissioner [Board]
4-23 may adjust the dollar threshold for aggregate reporting to account
4-24 for inflationary changes.
4-25 (h) Interchange of Rating Plan Data. Reasonable rules and
4-26 plans may be promulgated by the commissioner [Board] after due
4-27 consideration, requiring the interchange of loss experience
5-1 necessary for the application of rating plans promulgated by the
5-2 commissioner [Board] under this subchapter.
5-3 (i) Consultation with Other States. In order to further
5-4 uniform administration of rating laws, the commissioner [Board] and
5-5 every insurer may exchange information and experience data with the
5-6 National Association of Insurance Commissioners, insurance
5-7 supervisory officials, insurers, and advisory organizations in
5-8 other states and may consult and cooperate with them with respect
5-9 to rate-making and the application of rating systems.
5-10 SECTION 2. The importance of this legislation and the
5-11 crowded condition of the calendars in both houses create an
5-12 emergency and an imperative public necessity that the
5-13 constitutional rule requiring bills to be read on three several
5-14 days in each house be suspended, and this rule is hereby suspended,
5-15 and that this Act take effect and be in force from and after its
5-16 passage, and it is so enacted.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 3202 was passed by the House on April
11, 1997, by the following vote: Yeas 132, Nays 0, 2 present, not
voting.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 3202 was passed by the Senate on May
22, 1997, by the following vote: Yeas 31, Nays 0.
_______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor