1-1 By: Counts, Brimer (Senate Sponsor - Duncan) H.B. No. 3202
1-2 (In the Senate - Received from the House April 14, 1997;
1-3 April 16, 1997, read first time and referred to Committee on
1-4 Economic Development; May 18, 1997, reported favorably by the
1-5 following vote: Yeas 11, Nays 0; May 18, 1997, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to rate administration of workers' compensation insurance
1-9 policies.
1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11 SECTION 1. Article 5.58, Insurance Code, is amended to read
1-12 as follows:
1-13 Art. 5.58. RATE ADMINISTRATION FOR WORKERS' COMPENSATION
1-14 INSURANCE POLICIES; CLAIMS REPORTS. (a) Recording and Reporting
1-15 of Loss Experience and Other Data. The commissioner [Board] shall
1-16 develop reasonable statistical plans, which may be modified from
1-17 time to time and which shall be used thereafter by each insurer in
1-18 the recording and reporting of its loss experience and such other
1-19 data as may be required, in order that the total loss and expense
1-20 experience of all insurers may be made available at least annually
1-21 in such form and detail as may be necessary to aid in determining
1-22 whether rates meet the standards imposed under Section 2, Article
1-23 5.55 of this code. If the commissioner [Board] determines that any
1-24 insurer's rates do not meet those standards, the commissioner
1-25 [Board] may order the insurer to adjust its rates to meet those
1-26 standards. An [A Board] order of the commissioner under this
1-27 article may be appealed under Article 1.04 of this code. The
1-28 commissioner [Board] may designate or [not] contract with a
1-29 qualified organization to serve as the statistical agent for the
1-30 commissioner under this article as provided by Article 21.69 of
1-31 this code. The statistical agent [or designate an insurer or
1-32 advisory organization to gather or compile data for statistical
1-33 plans; however, an insurer] may provide to one or more advisory
1-34 organizations the information provided by the statistical agent
1-35 [insurer] to the commissioner [Board] under this article.
1-36 (b) Standards and Procedures. For purposes of Subsection (c)
1-37 of this article, the commissioner [Board] shall establish standards
1-38 and procedures for categorizing insurance and medical benefits
1-39 reported on each workers' compensation claim. The commissioner
1-40 [Board] shall consult with the Texas Workers' Compensation
1-41 Commission and the [Texas Workers' Compensation] Research and
1-42 Oversight Council on Workers' Compensation [Center] in establishing
1-43 these standards to ensure that the data collection methodology
1-44 will also yield data necessary for research and medical cost
1-45 containment efforts.
1-46 (c) Content of Detailed Claim Information [Unit Statistical
1-47 Data] Reports. The following information shall be reported on each
1-48 workers' compensation claim:
1-49 (1) the hazard classification of the affected
1-50 employee;
1-51 (2) the date of injury;
1-52 (3) the social security number of the claimant;
1-53 (4) the severity classification of the claim,
1-54 including separate classifications for claims in which death
1-55 benefits are paid, claims in which lifetime income benefits are
1-56 paid, claims in which only temporary income benefits are paid,
1-57 claims in which impairment benefits are paid, claims in which
1-58 supplemental benefits are paid, and claims in which only medical
1-59 benefits are paid;
1-60 (5) the amount paid in periodic payments;
1-61 (6) the amount paid in lump-sum payments;
1-62 (7) the amount paid for temporary income benefits;
1-63 (8) the amount paid for impairment income benefits;
1-64 (9) the amount paid for supplemental income benefits;
2-1 (10) the amount paid for death and burial benefits;
2-2 (11) the total amount paid for income, death, or
2-3 burial benefits;
2-4 (12) the total amount of incurred losses for income,
2-5 death, or burial benefits;
2-6 (13) the amount paid to doctors and other health care
2-7 providers;
2-8 (14) the amount paid to hospitals and other health
2-9 care facilities;
2-10 (15) the total amount paid for medical benefits;
2-11 (16) the total amount of incurred losses for medical
2-12 benefits; and
2-13 (17) other information required by the commissioner
2-14 [Board].
2-15 (d) Information Confidential. A person may not distribute
2-16 or otherwise disclose a social security number or any other
2-17 information collected under Subsection (c) of this article which
2-18 would disclose the identity of any claimant.
2-19 (e) Payments Excluded From Rates. In any statistical plan
2-20 developed by the commissioner [Board], direct expenditures by an
2-21 insurer to influence public policy and any amounts paid by an
2-22 insurer as damages in a suit against the insurer for malice or bad
2-23 faith or as fines or penalties shall be reported separately, and
2-24 the expenditures and payments shall not be considered as a loss or
2-25 expense for the calculation of any premium rate modifier or
2-26 surcharge of an insured.
2-27 (f) Transmission of Claims [Statistical] Reports. The
2-28 claims [statistical] reports filed under Subsection (c) of this
2-29 article shall be updated by each insurer and transmitted to the
2-30 commissioner or the commissioner's statistical agent [Board] in
2-31 accordance with the filing requirements of the commissioner's
2-32 [Board's] statistical plan. Each insurer writing at least
2-33 one-half of one percent of the workers' compensation insurance in
2-34 this state shall report its data in a compatible electronic format
2-35 prescribed by the commissioner [Board]. The commissioner [Board]
2-36 shall take necessary measures to ensure the accuracy of the data
2-37 and the adequacy of the format for data reported in an electronic
2-38 format.
2-39 (g) Reports of Aggregate Data. The commissioner [Board] may
2-40 permit the information required by Subsection (c) of this article
2-41 to be reported in the aggregate for each risk for claims in which
2-42 benefit payments are less than $5,000. The commissioner [Board]
2-43 may adjust the dollar threshold for aggregate reporting to account
2-44 for inflationary changes.
2-45 (h) Interchange of Rating Plan Data. Reasonable rules and
2-46 plans may be promulgated by the commissioner [Board] after due
2-47 consideration, requiring the interchange of loss experience
2-48 necessary for the application of rating plans promulgated by the
2-49 commissioner [Board] under this subchapter.
2-50 (i) Consultation with Other States. In order to further
2-51 uniform administration of rating laws, the commissioner [Board] and
2-52 every insurer may exchange information and experience data with the
2-53 National Association of Insurance Commissioners, insurance
2-54 supervisory officials, insurers, and advisory organizations in
2-55 other states and may consult and cooperate with them with respect
2-56 to rate-making and the application of rating systems.
2-57 SECTION 2. The importance of this legislation and the
2-58 crowded condition of the calendars in both houses create an
2-59 emergency and an imperative public necessity that the
2-60 constitutional rule requiring bills to be read on three several
2-61 days in each house be suspended, and this rule is hereby suspended,
2-62 and that this Act take effect and be in force from and after its
2-63 passage, and it is so enacted.
2-64 * * * * *