HBA-DMD H.B. 2511 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2511 By: Giddings Business & Industry 3/11/1999 Introduced BACKGROUND AND PURPOSE Currently, the amount of paperwork that must be processed within the Workers' Compensation system lengthens the time required to process workers' compensation claims and disputes. The Texas Workers' Compensation Commission (commission) staff sometimes has difficulty in obtaining or verifying workers' compensation coverage and claims information from employers, certified self-insurers, and political subdivisions. The commission currently utilizes more than 100 full-time employees to enter data into a database. The volume of information processed in this manner is too large to allow for effective quality control, and thus errors are made during data entry, which makes later analysis difficult. Additionally, in some cases employers will send reports of injury to the commission instead of the insurance carrier which causes delays in the delivery of medical care to injured workers. H.B. 2511 permits the commission, by rule, to allow or require electronic transmission of information to be used in lieu of transmitting information via paper form. This bill authorizes the commission to consult a data collection agent to fulfill the data collection requirements and adopt rules necessary to implement the data collection requirements. This bill also requires the executive director of the commission to develop a plan and appoint a task force to incorporate electronic reporting, information, and financial exchanges between parties in the workers' compensation system. The commission is authorized to adopt rules to establish the coverage and claim administration contact information. H.B. 2511 requires a certified self-insurer and political subdivision to file notice of the coverage and claim administration contact information with the commission. This bill also prohibits the employer from transferring the obligation to report injuries to the insurance carrier. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Texas Workers' Compensation Commission in SECTION 1 (Section 401.024, Labor Code), SECTION 2 (Section 406.006, Labor Code), and SECTION 3 (Section 406.009, Labor Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 401.024, Labor Code, as follows: Sec. 401.024. TRANSMISSION OF INFORMATION. (a) Authorizes the Texas Workers' Compensation Commission (commission), by rule, to allow or require electronic transmission to be used in lieu of the specified form, manner or procedure, notwithstanding other provisions in this Act that specify the form. Defines "electronic transmission." Provides that if electronic transmission of specific information is not authorized or required by commission rule, transmission of that information is governed by any applicable statutory or rule requirements for form, manner or procedure including but not limited to standards as promulgated by the Department of Information Resources. Authorizes the commission to designate and contract with a data collection agent in order to fulfill the data collection requirements of this subtitle. (b) Authorizes the executive director of the commission (executive director) to prescribe the form, manner, and procedure for transmission of any authorized or required electronic transmissions, including but not limited to requirements related to security, confidentiality, accuracy, and accountability. (c) Requires the executive director, to develop and publish a plan to incorporate electronic reporting, information, and financial exchanges between the parties in the workers' compensation system by July 1, 2000. Requires the plan to describe options for the public to access non-confidential statistical or reference information including medical billings and payments; medical services billings, payments, reports, and fund transfer transactions; employer coverage and carrier claim administration contact information; and other public access information and transactions that can feasibly be accessed electronically. Requires the executive director to identify a task force of knowledgeable system participants which will include the Texas Health Care Information Council, hold public hearings, and conduct studies that are necessary to develop a comprehensive electronic information exchange plan with specific dates for conversion of specific workers' compensation information to electronic exchange. Provides that the plan should be designed to achieve at least a 30 percent reduction in the paper usage for communication requirements by January 1, 2002, and an additional 30 percent reduction, from the current requirements, by January 1, 2003. SECTION 2. Amends Section 406.006, Labor Code, as follows: Sec. 406.006. New Title: INSURANCE COVERAGE AND CLAIM ADMINISTRATION INFORMATION REPORTING REQUIREMENTS; ADMINISTRATIVE VIOLATION. (a) Requires a certified self-insurer and a political subdivision as defined in Chapter 504 (Workers' Compensation Insurance Coverage for Employees of Political Subdivisions), Subtitle C (Workers' Compensation Insurance Coverage For Certain Government Employees) of Title 5 (Workers' Compensation), Labor Code, to file notice of the coverage and claim administration contact information with the commission no later than 10 days after the coverage or claim administration agreement takes effect, unless the commission, by rule, establishes a later date for filing. Provides that coverage takes effect on the date on which a binder is issued or at a later date and time which is agreed to by the parties, on the date provided by the Certificate of Self-Insurance, or on the date provided in an interlocal agreement that provides for self-insurance. Authorizes the commission to adopt rules in order to establish the coverage and claim administration contact information required under this section. (b) Makes no change. (c) Sets forth that an employer, insurance company, certified self-insurer, or political subdivision commits a violation if the entity, rather than company, fails to file notice with the commission as provided by this section. SECTION 3. Amends Section 406.009(a), Labor Code, as follows: (a) Authorizes the commission to designate a data collection agent, implement an electronic reporting and public information access program, and adopt rules necessary to implement the data collection requirements of this subchapter. Authorizes the executive director to establish the form, manner, and procedure for the transmission of information to the commission as provided by Section 402.042(b)(11) (General Powers and Duties of Executive Director). (b) Authorizes the commission to require an employer or insurance carrier subject to this title to identify or confirm an employer's coverage status and claim administration contact information as necessary to achieve the purposes of this title. SECTION 4. Amends Section 406.051(c), Labor Code, to prohibit the employer from transferring the obligation to report injuries to the insurance carrier, rather than commission, under Section 409.005 (Report of Injury; Administrative Violation). SECTION 5. Amends Section 408.003(e), Labor Code, to make a conforming change. SECTION 6. Amends Section 504.002(a), Labor Code, to provide that Sections 406.006 (Insurance Company Notice; Administrative Violation), 406.007 (Termination of Coverage by Employer; Notice), 406.008 (Cancellation or Nonrenewal of Coverage by Insurance Company; Notice), 406.009 (Collecting and Maintaining Information; Monitoring and Enforcing Compliance), and Subchapter A (Coverage Election; Security Procedures), Chapter 406 (Workers' Compensation Insurance Coverage), apply to and are included in this chapter except to the extent that they are inconsistent with this chapter. SECTION 7.Effective date: September 1, 1999. Provides that certified self-insurers and political subdivisions, not required to file notice of coverage prior to the effective date of this Act, must file information in accordance with the requirements of this Act and commission rules by January 1, 2000, and thereafter as required by the Texas Workers' Compensation Act and commission rules. SECTION 8.Emergency clause.