By Brimer                                             H.B. No. 2600
         Line and page numbers may not match official copy.
         Bill not drafted by TLC or Senate E&E.
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to medical and income benefits, return to work
 1-3     coordination, and regulation of doctors and insurance carriers
 1-4     under the workers' compensation system.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6               ARTICLE 1.  AUTHORIZED DOCTORS; MEDICAL REVIEW
 1-7           SECTION 1.01. Subchapter B, Chapter 408, Labor Code, is
 1-8     amended by amending Section 408.023 and adding Section 408.0231 to
 1-9     read as follows:
1-10           Sec. 408.023.  List of Approved Doctors. (a)  The commission
1-11     shall develop a list of Texas licensed doctors who are approved to
1-12     provide medical services under this subtitle.  Each doctor licensed
1-13     in this state [on January 1, 1993,] is eligible to be included on
1-14     the commission's list of approved doctors if the doctor:
1-15                 (1)  registers with the commission in the manner
1-16     prescribed by commission rules; and
1-17                 (2)  complies with the requirements adopted by the
1-18     commission under this section.
1-19           (b)  The commission by rule shall establish reasonable
1-20     training, impairment rating testing, financial interest disclosure,
1-21     and monitoring requirements for doctors and health care providers
1-22     financially related to those doctors who:
1-23                 (1)  provide services as treating doctors;
 2-1                 (2)  provide services as authorized by Sections 408.004
 2-2     or 408.122;
 2-3                 (3)  perform medical peer review under this subtitle;
 2-4                 (4)  perform utilization review of medical benefits
 2-5     provided under this subtitle; and
 2-6                 (5)  provide medical services on referral from the
 2-7     treating doctor as provided by commission rule.
 2-8           (c)  The commission shall issue to a doctor who is approved
 2-9     by the commission a certificate of registration.  A certificate of
2-10     registration issued under this subsection is valid for four years
2-11     from the date of issuance or as may be provided by commission rule,
2-12     and may be renewed on application to the commission [unless
2-13     subsequently deleted and not reinstated.  The name of a doctor
2-14     shall be placed on the list of approved doctors when that doctor
2-15     becomes licensed in this state].
2-16           (d)  A doctor not licensed in this state but licensed in
2-17     another state or jurisdiction who treats employees may apply for a
2-18     certificate of registration under this section [to the commission]
2-19     to be included on the commission's list of approved doctors.
2-20           (e)  Each doctor performing functions under this subtitle,
2-21     including examinations under Sections 408.004 and 408.122 and
2-22     medical utilization review evaluations, must hold a certificate of
2-23     registration and be on the list of approved doctors in order to
2-24     perform services or receive payment for those services.
2-25           (f)  The commission may grant exceptions to the requirement
2-26     imposed under Subsection (e) as necessary to ensure that employees
 3-1     have access to medical care.
 3-2           (g)  The treating doctor is responsible for the efficient
 3-3     management of medical care as required by Section 408.025(c) and
 3-4     commission rules, whether that care is provided directly or by a
 3-5     provider on referral from the treating doctor.  The commission
 3-6     shall capture information regarding return to work outcomes,
 3-7     patient satisfaction, and cost and utilization of medical services
 3-8     provided or authorized by a treating doctor on the list of approved
 3-9     doctors.
3-10           Sec. 408.0231.  DELETION FROM LIST OF APPROVED DOCTORS;
3-11     SANCTIONS. (a)  The executive director shall delete from the list a
3-12     doctor who is deceased, whose license to practice in this state is
3-13     revoked by the appropriate licensing board, or who requests to be
3-14     removed from the list.
3-15           (b)  The commission by rule shall establish criteria for:
3-16                 (1)  deleting a doctor from the list of approved
3-17     doctors;
3-18                 (2)  imposing sanctions on a doctor as provided by this
3-19     section; and
3-20                 (3)  authorizing reduced utilization review and
3-21     preauthorization controls on a doctor.
3-22           (c)  The rules adopted under Subsection (b) are in addition
3-23     to, and do not affect, the rules adopted under Section 415.023(b).
3-24     The criteria for deleting a doctor from the list or for imposing
3-25     sanctions may include anything the commission considers relevant,
3-26     including:
 4-1                 (1)  a sanction [sanctions] of the doctor by the
 4-2     commission for a violation [violations] of Chapter 413 or Chapter
 4-3     415;
 4-4                 (2)  a sanction [sanctions] by the Medicare or Medicaid
 4-5     program for:
 4-6                       (A)  substandard medical care;
 4-7                       (B)  overcharging; [or]
 4-8                       (C)  overutilization of medical services; or
 4-9                       (D)  any other noncompliance with that program in
4-10     professional practice or billing;
4-11                 (3)  evidence from the commission's medical records
4-12     that the applicable insurance carrier's utilization review
4-13     practices or the doctor's charges, fees, diagnoses, [or]
4-14     treatments, evaluations, or impairment ratings are unjustifiably
4-15     [substantially] different from those the commission finds to be
4-16     fair and reasonable; [and]
4-17                 (4)  suspension of the doctor's license by an [the]
4-18     appropriate licensing authority;
4-19                 (5)  professional failure to practice medicine in an
4-20     acceptable manner consistent with the public health and welfare;
4-21     and
4-22                 (6)  the findings of fact and conclusions of law of a
4-23     court, an administrative law judge from the State Office of
4-24     Administrative Hearings, or a licensing or regulatory authority, or
4-25     a criminal conviction.
4-26           (d) [(c)]  The commission by rule shall establish procedures
 5-1     under which [for] a doctor may [to] apply for:
 5-2                 (1)  reinstatement to the list of approved doctors; or
 5-3                 (2)  restoration of doctor practice privileges removed
 5-4     by the commission based on sanctions imposed under this section.
 5-5           (e)  Notwithstanding Article 21.58A, Insurance Code, the
 5-6     commission may, on a recommendation by the medical advisor and
 5-7     after notice and the opportunity for a hearing, impose sanctions
 5-8     under this subsection on a doctor, an insurance carrier, or a
 5-9     utilization review agent. Those sanctions may include:
5-10                 (1)  reduction of allowable reimbursement;
5-11                 (2)  mandatory preauthorization of all or certain
5-12     medical services;
5-13                 (3)  required peer review monitoring and audit with the
5-14     doctor bearing responsibility for the reasonable cost of monitoring
5-15     and audit;
5-16                 (4)  suspension or deletion from the approved doctor
5-17     list and the designated doctor list;
5-18                 (5)  restrictions on appointment under Section 408.004;
5-19                 (6)  suspension of an insurance carrier or utilization
5-20     review agent's ability to perform functions under this subtitle;
5-21     and
5-22                 (7)  mandatory participation in training classes or
5-23     other courses as established or certified by the commission.
5-24           SECTION 1.02. Subchapter E, Chapter 413, Labor Code, is
5-25     amended by amending Section 413.051 and adding Sections 413.0511,
5-26     413.0512 and 413.0513 to read as follows:
 6-1           Sec. 413.051.  CONTRACTS WITH REVIEW ORGANIZATIONS AND HEALTH
 6-2     CARE PROVIDERS. (a)  The commission may contract with a health care
 6-3     provider professional review organization, health care provider, or
 6-4     other entity to develop, maintain, or review medical policies or
 6-5     fee guidelines or to review compliance with the medical policies or
 6-6     fee guidelines.
 6-7           (b)  For purposes of review or resolution of a dispute as to
 6-8     compliance with the medical policies or fee guidelines, the
 6-9     commission may contract [only] with a health care provider
6-10     professional review organization, health care provider, or other
6-11     entity that includes in the review process health care
6-12     practitioners who are licensed in the category under review and are
6-13     of the same field or specialty as the category under review.
6-14           (c)  The commission may contract with a health care provider
6-15     professional review organization, health care provider, or other
6-16     entity for medical consultant services, including:
6-17                 (1)  independent medical examinations;
6-18                 (2)  medical case reviews; or
6-19                 (3)  establishment of medical policies and fee
6-20     guidelines.
6-21           (d)  The commission shall establish standards for contracts
6-22     under this section.
6-23           Sec. 413.0511.  MEDICAL ADVISOR. (a)  The commission shall
6-24     employ or contract with a medical advisor, who must be a doctor as
6-25     that term is defined by Section 401.011.
6-26           (b)  The medical advisor shall:
 7-1                 (1)  develop, maintain, and review medical policies and
 7-2     fee guidelines, including medical policies regarding the
 7-3     determination of impairment ratings;
 7-4                 (2)  review compliance with those medical policies and
 7-5     fee guidelines;
 7-6                 (3)  perform other acts related to medical benefits as
 7-7     required by the commission; and
 7-8                 (4)  recommend sanction or deletion of doctors from the
 7-9     commission's list of approved doctors under Section 408.023 for:
7-10                       (A)  any reason described by Section 408.0235; or
7-11                       (B)  noncompliance with a policy reviewed by the
7-12     medical advisor under this section.
7-13           Sec. 413.0512.  MEDICAL QUALITY REVIEW PANEL. (a)  The
7-14     medical advisor may establish a medical quality review panel of
7-15     health care providers as an advisory body to assist the medical
7-16     advisor.  The panel is independent of the medical advisory
7-17     committee created under Section 413.005.
7-18           (b)  The medical quality review panel shall recommend to the
7-19     medical advisor appropriate action to sanction health care
7-20     providers and utilization review agents and to add, suspend, or
7-21     delete doctors from the list of approved doctors or the group of
7-22     designated doctors established under Section 408.122.
7-23           (c)  The Texas State Board of Medical Examiners and the Texas
7-24     State Board of Chiropractic Medical Examiners shall develop lists
7-25     of physicians and chiropractors licensed by those agencies who have
7-26     demonstrated experience in workers' compensation or utilization
 8-1     review.  The medical advisor shall appoint some of the members of
 8-2     the medical quality review panel from the names on those lists.
 8-3           (d) [(e)]  Except for harm resulting from an act or omission
 8-4     involving gross negligence, malice, or recklessness, a person who
 8-5     serves on the medical quality review panel is not liable for an act
 8-6     or omission committed in the course and scope of the person's
 8-7     service as a member of the panel.
 8-8           (e) [(f)]  The actions of a person serving on the medical
 8-9     quality review panel do not constitute utilization review and are
8-10     not subject to Article 21.58A, Insurance Code.
8-11           Sec. 413.0513.  CONFIDENTIALITY REQUIREMENTS.
8-12     (a)  Information that is confidential under law may not be
8-13     disclosed under Section 413.0512 except:
8-14                 (1)  in a criminal proceeding;
8-15                 (2)  in a hearing conducted by or on behalf of the
8-16     commission;
8-17                 (3)  in a hearing conducted by another licensing or
8-18     regulatory authority, as provided in the interagency agreement; or
8-19                 (4)  on a finding of good cause in an administrative or
8-20     judicial proceeding involving the enforcement of this subtitle or
8-21     in a disciplinary action under this subtitle.
8-22           (b)  Confidential information developed by the commission
8-23     under Section 413.0512 is not subject to discovery or court
8-24     subpoena in any action other than:
8-25                 (1)  an action to enforce this subtitle brought by the
8-26     commission, an appropriate licensing or regulatory agency, or an
 9-1     appropriate enforcement authority; or
 9-2                 (2)  a criminal proceeding.
 9-3           SECTION 1.03.  EFFECTIVE DATE. (a)  This Act takes effect
 9-4     September 1, 2001.
 9-5           (b)  The Texas Workers' Compensation Commission shall adopt
 9-6     rules as required by Chapter 408, Labor Code, as amended by this
 9-7     Act, not later than February 1, 2002. A doctor covered under this
 9-8     act is required to hold a certificate of registration issued under
 9-9     Section 408.023 to perform medical services under Subtitle A, Title
9-10     5, Labor Code by the date provided by commission rules adopted to
9-11     implement this act.
9-12              ARTICLE 2.  MEDICAL NETWORK PARTICIPATION OPTION
9-13           SECTION 2.01. Subchapter B, Chapter 408, Labor Code, is
9-14     amended by adding Section 408.0221 to read as follows:
9-15           Sec. 408.0221.  SELECTION OF DOCTOR WITHIN NETWORK. (a)  The
9-16     commission shall establish a medical network advisory committee
9-17     that includes:
9-18                 (1)  Organized labor and employee representatives;
9-19                 (2)  Public employer representatives selected from the
9-20     State Office of Risk Management, University of Texas System, Texas
9-21     A&M University System, Texas Department of Transportation, Texas
9-22     Association of School Boards, Texas Municipal League and Texas
9-23     Association of Counties;
9-24                 (3)  Private sector employers and insurance carrier
9-25     representatives including the Texas Workers' Compensation Fund.
9-26                 (4)  The commission's medical advisor created under
 10-1    Section 413.0511 and representatives of the medical quality panel
 10-2    created under Section 413.0512 of this Act; and
 10-3                (5)  Representatives of the Employee Retirement System,
 10-4    Comptroller of Public Accounts, Texas Department of Insurance, and
 10-5    Texas Health Care Information Council as the commission deems
 10-6    necessary.
 10-7          (b)  The commission, with the input from the medical network
 10-8    advisory committee, shall create standards for workers'
 10-9    compensation health care delivery networks authorized by this
10-10    subchapter.
10-11          (c)  The commission shall establish regional workers'
10-12    compensation health care delivery networks, to be known as
10-13    networks, by contract.
10-14          (d)  A health care provider who participates in a network
10-15    created under this section shall be reimbursed as provided in the
10-16    contract and shall be subject to reduced regulation and
10-17    preauthorization as well as uniform billing and utilization review
10-18    requirements.
10-19          (e)  A doctor providing medical services to an employee under
10-20    this section must be on the commission's list of approved doctors.
10-21    A doctor may perform only those procedures that are within the
10-22    scope of the practice for which the doctor is licensed.
10-23          (f)  An employee may elect to participate in a network
10-24    created under this section:
10-25                (1)  at the time of hire or upon the notification of
10-26    workers' compensation coverage by the employer, concurrent with the
 11-1    elections under Section 406.034; and
 11-2                (2)  an employee that elected not to participate in the
 11-3    network under subsection (f)(1), may elect to participate in the
 11-4    network no later than 14 days of the employee's date of injury, or
 11-5    at a later date with the agreement of the insurance carrier and the
 11-6    approval of the commission.
 11-7          (g)  An employee who elects to participate in the network
 11-8    shall receive:
 11-9                (1)  income benefits from the date disability begins if
11-10    the disability lasts two weeks or longer, rather than the four
11-11    weeks as required by Section 408.082(c) of this subtitle; and
11-12                (2)  an increased maximum weekly benefit of up to 150%
11-13    of the State Average Weekly Wage for temporary income benefits,
11-14    rather than 100% as provided by Section 408.061 of this subtitle.
11-15          (h)  An employee who elects to participate in a network
11-16    established in subsection (c) shall either:
11-17                (1)  select an initial treating doctor within the
11-18    network; or
11-19                (2)  select an initial treating doctor outside of the
11-20    network if the employee has a pre-existing doctor-patient
11-21    relationship with the doctor and the doctor agrees in writing to
11-22    abide by the terms of the network contract.
11-23          (i)  An employee who selects an initial treating doctor under
11-24    subsection (h) may change treating doctors within the network in
11-25    accordance with Section 408.022 (d) and (e) of this subtitle.  An
11-26    employee that requests to change treating doctors within the
 12-1    network is not subject to Section 408.022 (b) and (c) of this
 12-2    subtitle.  The employee may request to change to a treating doctor
 12-3    outside of the network with the approval of the network or by a
 12-4    decision of the commission.
 12-5          (j)  Except in an emergency, an employee who elects to
 12-6    participate in a network established in subsection (c) shall
 12-7    receive medical treatment from health care providers within the
 12-8    network.
 12-9          (k)  To resolve a dispute arising under this Subsection, an
12-10    employee or an employee's treating doctor that requests to use a
12-11    health care provider outside of the network may request a review of
12-12    the necessity of an alternate doctor by an independent review
12-13    organization under Section 413.031(c).  A health care provider
12-14    outside of the network that is authorized to treat the employee
12-15    must agree to abide by the terms of the network contract prior to
12-16    providing any medical service under this chapter.
12-17          (l)  An employee who elects not to participate in a network
12-18    is subject to the selection and change of doctor requirements in
12-19    chapter 408, Subchapter B of this subtitle.
12-20          SECTION 2.02.  EFFECTIVE DATE. (a)  This Act takes effect
12-21    September 1, 2001.
12-22          (b)  The Texas Workers' Compensation Commission shall adopt
12-23    rules as required by Chapter 408, Labor Code, as amended by this
12-24    Act, not later than December 1, 2001.
12-25          (c)  The Texas Workers' Compensation Commission shall convene
12-26    the first meeting of the medical network advisory committee no
 13-1    later than October 1, 2001.
 13-2          (d)  The Texas Workers' Compensation Commission shall
 13-3    establish regional workers' compensation health care delivery
 13-4    networks no later than May 1, 2002.
 13-5            ARTICLE 3.  RETURN TO WORK REPORTING AND SERVICES.
 13-6          SECTION 3.01. Section 409.005, Labor Code, is amended by
 13-7    adding Subsection (j) to read as follows:
 13-8          Sec. 409.005.  EMPLOYER REPORT OF INJURY; MODIFIED DUTY
 13-9    PROGRAM NOTICE; ADMINISTRATIVE VIOLATION.
13-10          (j)  The employer shall notify the employee, treating doctor
13-11    if known, and insurance carrier of the existence or absence of
13-12    modified duty opportunities or a modified duty return-to-work
13-13    program available through the employer.  If modified duty
13-14    opportunities or a program for modified duty exists, the employer
13-15    must identify the employer's contact person, and provide other
13-16    information to assist the treating doctor and the employee to
13-17    assess return-to-work options.  The employer shall provide the
13-18    required notice as soon as possible after the injury, but no later
13-19    than the eighth day after the employee's absence from work for more
13-20    than one day due to an injury, unless the commission modifies this
13-21    notification requirement by rule.
13-22          (k)  A person commits a violation if the person fails to
13-23    comply with this section unless good cause exists.  A violation
13-24    under this subsection is a Class D administrative violation.
13-25          SECTION 3.02. Subchapter B, Chapter 413, Labor Code, is
13-26    amended by adding a Section 413.021 to read as follows:
 14-1          Sec. 413.021.  RETURN-TO-WORK COORDINATION SERVICES. (a)  The
 14-2    insurance carrier shall notify the employer of the availability of
 14-3    return-to-work coordination services.  An insurance carrier shall,
 14-4    with the agreement of a participating employer, provide the
 14-5    employer with return-to-work coordination services as necessary to
 14-6    facilitate an employee's re-integration to work.  In offering the
 14-7    services, insurance carriers and the commission shall target small
 14-8    employers and employers without return-to-work programs, and shall
 14-9    focus return-to-work efforts on workers that begin to receive
14-10    temporary income benefits.
14-11          (b)  Return-to-work coordination services include:
14-12                (1)  job analysis to identify the physical demands of a
14-13    job;
14-14                (2)  job modification and restructuring assessments as
14-15    necessary to match job requirements with the functional capacity of
14-16    an employee; and
14-17                (3)  other reasonable services that facilitate return
14-18    to work.
14-19          (c)  The commission shall hire or secure the services of
14-20    certified rehabilitation counselors or other comparably
14-21    credentialed vocational specialists to provide training to
14-22    commission staff regarding the coordination of return-to-work
14-23    programs under this section and to assist in the evaluation and
14-24    resolution of disputes regarding return-to-work coordination
14-25    services available under this section.
14-26          (d)  The commission shall adopt rules to define the extent of
 15-1    required services, minimum credentials of service providers,
 15-2    appropriate service provider fees and insurance carriers reporting
 15-3    of those fees, and other matters necessary to implement this
 15-4    section.
 15-5          (e)  The commission shall report twice annually to the
 15-6    Research and Oversight Council on Workers' Compensation regarding
 15-7    the implementation and outcome of the return to work initiatives
 15-8    required by this section.
 15-9          SECTION 3.03.  EFFECTIVE DATE. This Act takes effect
15-10    September 1, 2001. The Texas Workers' Compensation Commission shall
15-11    adopt rules and implement the provisions of section two of this Act
15-12    not later than March 1, 2002.  The change in law made by this
15-13    section two of this Act expires on September 1, 2004 unless the law
15-14    is extended by action of the legislature.
15-15              ARTICLE 4.  PREAUTHORIZATION, CONCURRENT REVIEW
15-16                            AND CERTIFICATION.
15-17          SECTION 4.01. Section 408.026, Labor Code, is amended to read
15-18    as follows:
15-19          Sec. 408.026.  SPINAL SURGERY PREAUTHORIZATION [SECOND
15-20    OPINION]. [(a)]  Except in a medical emergency, an insurance
15-21    carrier is liable for medical costs related to spinal surgery only
15-22    if[:]  the insurance carrier preauthorizes the surgery as provided
15-23    by Section 413.014 and commission rules.  [(1)  before surgery, the
15-24    employee obtains from a doctor approved by the insurance carrier or
15-25    the commission a second opinion that concurs with the  treating
15-26    doctor's recommendation;]
 16-1                [(2)  the insurance carrier waives the right to an
 16-2    examination or fails to request an examination before the 15th day
 16-3    after the date of the notification that surgery is recommended; or]
 16-4                [(3)  the commission determines that extenuating
 16-5    circumstances exist and orders payment for surgery.]
 16-6          [(b)  The commission shall adopt rules necessary to ensure
 16-7    that an examination required under this section is performed
 16-8    without undue delay.]
 16-9          SECTION 4.02. Section 413.014, Labor Code, is amended to read
16-10    as follows:
16-11          Sec. 413.014.  PREAUTHORIZATION REQUIREMENTS; CONCURRENT
16-12    REVIEW AND CERTIFICATION OF HEALTH CARE. (a)  The commission by
16-13    rule shall specify which health care treatments and services
16-14    require express preauthorization and concurrent review by the
16-15    insurance carrier.  Treatments and services for a medical emergency
16-16    do not require express preauthorization or concurrent review.
16-17          (b)  The commission rules adopted under this section shall
16-18    provide that preauthorization and concurrent review is required at
16-19    a minimum for:
16-20                (1)  spinal surgery, as provided by Section 408.026;
16-21                (2)  work-hardening or work-conditioning services
16-22    provided by a health care facility that is not credentialed by an
16-23    organization recognized by commission rules;
16-24                (3)  inpatient hospitalization; and
16-25                (4)  any new or investigational procedure identified by
16-26    commission rule.
 17-1          (c)  The insurance carrier is not liable for those specified
 17-2    treatments and services requiring preauthorization unless
 17-3    preauthorization is sought by the claimant or health care provider
 17-4    and either obtained from the insurance carrier or ordered by the
 17-5    commission.
 17-6          (d)  Each insurance carrier shall allow health care providers
 17-7    the option to request that the insurance carrier prospectively or
 17-8    concurrently certify coverage for health care services, including
 17-9    pharmaceutical services, that do not require preauthorization and
17-10    concurrent review.  The carrier retains the right to review health
17-11    care services and their supporting records and to contest the
17-12    certification of those services based upon:
17-13                (1)  the representations of the provider made at the
17-14    time the certification was requested;
17-15                (2)  the medical services actually provided versus
17-16    those certified; and
17-17                (3)  evidence deemed relevant to the review of
17-18    certifications as determined and set forth by commission rules.
17-19          (e)  The commission may by rule provide that an insurance
17-20    carrier is liable for payment of specified medical services within
17-21    the first 14 days following a report of injury if the health care
17-22    provider requests and receives certification of insurance coverage
17-23    and a report of injury from the employer or from the insurance
17-24    carrier.  The rules adopted by the commission may also provide that
17-25    an insurance carrier is eligible for reimbursement for medical
17-26    services paid under this subsection from the subsequent injury fund
 18-1    in the event the injury is determined not to be compensable.
 18-2          SECTION 4.03.  EFFECTIVE DATE.  This Act takes effect
 18-3    September 1, 2001 and the commission shall adopt the rules required
 18-4    under this Act by April 1, 2002.
 18-5                ARTICLE 5.  REQUIRED MEDICAL EXAMINATIONS.
 18-6          SECTION 5.01.  Section 408.004, Labor Code, is amended to
 18-7    read as follows:
 18-8          Sec. 408.004.  Required Medical Examinations; Administrative
 18-9    Violation. (a)  The commission may require an employee to submit to
18-10    medical examinations to resolve any question about:
18-11                (1)  the appropriateness of the health care received by
18-12    the employee;
18-13                (2)  the impairment caused by the compensable injury;
18-14                (3)  the attainment of maximum medical improvement;
18-15    [or]
18-16                (4)  the employee's ability to return to work; or
18-17                (5)  similar issues.
18-18          (b)  [effective for dates of injury on or before September 1,
18-19    1997] The commission may require an employee to submit to a medical
18-20    examination at the request of the insurance carrier.  An
18-21    examination shall be performed by the next available doctor
18-22    appropriate for the injured employee's medical condition on the
18-23    commission designated doctor list.  The designated doctor shall
18-24    report to the commission.  The report of the designated doctor has
18-25    presumptive weight unless the great weight of the evidence is to
18-26    the contrary.  An employer may make a bona fide offer of employment
 19-1    as provided by Sections 408.103(e) and 408.144(c) based on the
 19-2    designated doctor's report. [, but only after the insurance carrier
 19-3    has attempted and failed to receive the permission and concurrence
 19-4    of the employee for the examination.  The insurance carrier is
 19-5    entitled to the examination only once in a 180-day period.  A
 19-6    subsequent examination must be performed by the same doctor unless
 19-7    otherwise approved by the commission.]
 19-8          [(b)  effective for dates of injury on or after September 1,
 19-9    1997  The commission may require an employee to submit to a medical
19-10    examination at the request of the insurance carrier, but only after
19-11    the insurance carrier has attempted and failed to receive the
19-12    permission and concurrence of the employee for the examination.
19-13    Except as otherwise provided by this subsection, the insurance
19-14    carrier is entitled to the examination only once in a 180-day
19-15    period. The commission may adopt rules that require an employee to
19-16    submit to not more than three medical examinations in a 180-day
19-17    period under specified circumstances, including to determine
19-18    whether there has been a change in the employee's condition,
19-19    whether it is necessary to change the employee's diagnosis, and
19-20    whether treatment should be extended to another body part or
19-21    system.  The commission by rule shall adopt a system for monitoring
19-22    requests made under this subsection by insurance carriers.  That
19-23    system must ensure that good cause exists for any additional
19-24    medical examination allowed under this subsection that is not
19-25    requested by the employee.  A subsequent examination must be
19-26    performed by the same doctor unless otherwise approved by the
 20-1    commission.]
 20-2          (c)  An insurance carrier may request the commission to order
 20-3    an employee to attend an examination by a doctor selected by the
 20-4    insurance carrier if the insurance carrier is not satisfied with
 20-5    the opinion rendered by a designated doctor under Subsection (b) of
 20-6    this section.  The commission shall allow the insurance carrier
 20-7    reasonable time to obtain and present the opinion of the doctor
 20-8    selected under this subsection before the commission makes a final
 20-9    decision on the merits of the issue in question.
20-10          (d)  The insurance carrier shall pay for:
20-11                (1)  an examination required under Subsection (a) or
20-12    (b); and
20-13                (2)  the reasonable expense incident to the employee in
20-14    submitting to the examination.
20-15          (e)  An injured employee is entitled to have a doctor of the
20-16    employee's choice present at an examination required by the
20-17    commission at the request of an insurance carrier.  The insurance
20-18    carrier shall pay a fee set by the commission to the doctor
20-19    selected by the employee.  [effective for required medical
20-20    examinations scheduled to occur before January 1, 2000) If the
20-21    report of a doctor selected by an insurance carrier indicates that
20-22    the employee can return to work immediately, the commission shall
20-23    schedule a benefit review conference on the next available docket.
20-24    The insurance carrier may not suspend medical or income benefit
20-25    payments pending the benefit review conference.]
20-26          (e)  (effective for required medical examinations scheduled
 21-1    to occur on or after January 1, 2000)  An employee who, without
 21-2    good cause as determined by the commission, fails or refuses to
 21-3    appear at the time scheduled for an examination under Subsection
 21-4    (a) or (b) commits a violation.  A violation under this subsection
 21-5    is a Class D administrative violation.  An employee is not entitled
 21-6    to temporary income benefits, and an insurance carrier may suspend
 21-7    the payment of temporary income benefits, during and for a period
 21-8    in which the employee fails to submit to an examination under
 21-9    Subsection (a) or (b) unless the commission determines that the
21-10    employee had good cause for the failure to submit to the
21-11    examination.  The commission may order temporary income benefits to
21-12    be paid for the period that the commission determines the employee
21-13    had good cause.  The commission by rule shall ensure that an
21-14    employee receives reasonable notice of an examination and of the
21-15    insurance carrier's basis for suspension of payment, and that the
21-16    employee is provided a reasonable opportunity to reschedule an
21-17    examination missed by the employee for good cause.
21-18          [(f)  (effective for required medical examinations scheduled
21-19    to occur before January 1, 2000)  An employee who, without good
21-20    cause, fails or refuses to appear at the time scheduled for an
21-21    examination under Subsection (a) or (b) commits a violation.  A
21-22    violation under this subsection is a Class D administrative
21-23    violation.]
21-24          (f)  (effective for required medical examinations scheduled
21-25    to occur on or after January 1, 2000)  If the report of a
21-26    designated doctor or a doctor selected by an insurance carrier
 22-1    indicates that an employee can return to work immediately or has
 22-2    reached maximum medical improvement, the insurance carrier may
 22-3    suspend or reduce the payment of temporary income benefits on the
 22-4    14th day after the date on which the insurance carrier files a
 22-5    notice of suspension with the commission as provided by this
 22-6    subsection.  The commission shall hold an expedited benefit review
 22-7    conference, by personal appearance or by telephone, not later than
 22-8    the 10th day after the date on which the commission receives the
 22-9    insurance carrier's notice of suspension.  If a benefit review
22-10    conference is not held by the 14th day after the date on which the
22-11    commission receives the insurance carrier's notice of suspension,
22-12    an interlocutory order, effective from the date of the report
22-13    certifying maximum medical improvement, is automatically entered
22-14    for the continuation of temporary income benefits until a benefit
22-15    review conference is held, and the insurance carrier is eligible
22-16    for reimbursement for any overpayment of benefits as provided by
22-17    Chapter 410.  The commission is not required to automatically
22-18    schedule a contested case hearing as required by Section 410.025(b)
22-19    if a benefit review conference is scheduled under this subsection.
22-20    If a benefit review conference is held not later than the 14th day,
22-21    the commission may enter an interlocutory order for the
22-22    continuation of benefits, and the insurance carrier is eligible for
22-23    reimbursement for any overpayments of benefits as provided by
22-24    Chapter 410.  The commission shall adopt rules as necessary to
22-25    implement this subsection under which:
22-26                (1)  an insurance carrier is required to notify the
 23-1    employee and the treating doctor of the suspension of benefits
 23-2    under this subsection by certified mail or another verifiable
 23-3    delivery method;
 23-4                (2)  the commission makes a reasonable attempt to
 23-5    obtain the treating doctor's opinion before the commission makes a
 23-6    determination regarding the entry of an interlocutory order; and
 23-7                (3)  the commission may allow abbreviated contested
 23-8    case hearings by personal appearance or telephone to consider
 23-9    issues relating to overpayment of benefits under this section.
23-10          (f) [(g)]  (effective for dates of injury on or after
23-11    September 1, 1997)  An insurance carrier who unreasonably requests
23-12    a medical examination under Subsection (b) commits a violation.  A
23-13    violation under this subsection is a Class B administrative
23-14    violation.
23-15          SECTION 5.02.  EFFECTIVE DATE.  This Act is effective
23-16    September 1, 2001, and the change in law made by this act is
23-17    effective for a request for an examination requested on or after
23-18    January 1, 2002.
23-19        ARTICLE 6.  MEDICAL BENEFIT REGULATION; DISPUTE RESOLUTION
23-20          SECTION 6.01.  Section 408.028 of the Labor Code is amended
23-21    to read as follows:
23-22          Sec. 408.028.  Pharmaceutical Services. (a)  A doctor [health
23-23    care practitioner] providing care to an employee under this
23-24    subchapter shall prescribe for the employee any necessary
23-25    prescription drugs and nonprescription medications in accordance
23-26    with:
 24-1                (1)  applicable state law; and
 24-2          (b)  In establishing fee and treatment guidelines regarding
 24-3    pharmaceuticals under Chapter 413, the commission shall develop a
 24-4    formulary that requires generic pharmaceutical medications when
 24-5    authorized by the prescribing doctor.  The doctor and pharmacist
 24-6    may discuss medication options that will achieve the desired
 24-7    therapeutic results while controlling costs and reducing adverse
 24-8    impacts.
 24-9          (c)  An insurance carrier may not require an employee to use
24-10    pharmaceutical services designated by the carrier.
24-11          SECTION 6.02.  EFFECTIVE DATE. This Act takes effect
24-12    September 1, 2001, and the commission shall adopt rules required by
24-13    this Act by June 1, 2002.
24-14          SECTION 6.03. Sections 413.031, 413.041, and 415.0035 of the
24-15    Labor Code, are amended to read as follows:
24-16          Sec. 413.031.  Medical Dispute Resolution. (a)  A party,
24-17    including a health care provider or claimant, is entitled to a
24-18    review of a medical service provided or for which authorization of
24-19    payment is sought if that party [a health care provider] is:
24-20                (1)  denied payment or paid a reduced amount for the
24-21    medical service rendered;
24-22                (2)  denied authorization for the payment for the
24-23    service requested or performed if authorization is required or
24-24    allowed by [the medical policies of the] this subtitle or
24-25    commission rules; [or]
24-26                (3)  ordered by the commission [division] to refund a
 25-1    payment received; or
 25-2                (4)  ordered to make a payment refused or reduced for a
 25-3    medical service rendered.
 25-4          (b)  A health care provider who submits a charge in excess of
 25-5    the fee guidelines or treatment policies is entitled to a review of
 25-6    the medical service to determine if reasonable medical
 25-7    justification exists for the deviation.
 25-8          (c)  A review of the medical necessity of a medical service
 25-9    provided or requested and denied under this chapter [section] shall
25-10    be provided by a health care provider professional independent
25-11    review organization [if requested by the health care practitioner
25-12    or if ordered by the commission], unless the health care provider
25-13    and the insurance carrier agree to waive this requirement as
25-14    provided by commission rules.  The insurance carrier shall pay the
25-15    cost of the review unless the commission, based on the findings of
25-16    the review, determines that the health care provider has repeatedly
25-17    or unreasonably exceeded medically sound practices, in which case
25-18    the health care provider shall be ordered to pay the cost of the
25-19    review.
25-20          SECTION 6.04.  EFFECTIVE DATE. This Act takes effect
25-21    September 1, 2001 and is effective for any request for a review of
25-22    medical services covered under this Act received by the commission
25-23    on or after January 1, 2002.
25-24          Sec. 413.041.  DISCLOSURE. (a)  A doctor shall disclose to
25-25    the commission the health care providers in which the doctor or the
25-26    health care provider that employs the doctor, has a financial
 26-1    interest as provided by the regulations adopted by the federal
 26-2    government for the Medicare program.  The commission shall require
 26-3    by rule that a doctor disclose financial interests in other health
 26-4    care providers as a condition of registration for the Approved
 26-5    Doctor List established under 408.023 and shall adopt the federal
 26-6    regulations that define financial interest.  A doctor or health
 26-7    care provider that fails to comply with this section is subject to
 26-8    penalties and sanctions as provided by this subtitle including the
 26-9    forfeiture of the right to reimbursement for services rendered
26-10    during the period of non-compliance.  [A health care provider who
26-11    refers a workers' compensation claimant to another health care
26-12    provider in which the referring provider has more than a five
26-13    percent financial interest shall file an annual disclosure
26-14    statement with the commission as provided by commission rules and
26-15    shall disclose the interest to the insurance carrier at the time of
26-16    the referral.  The referring provider shall specify the degree of
26-17    the financial interest and shall provide other information as
26-18    required by commission rules.]
26-19          SECTION 6.05.  EFFECTIVE DATE. This Act is effective
26-20    September 1, 2001 and the change in law by this Act applies to
26-21    financial interests and services on the date provided by commission
26-22    rule adopted to implement this Act.
26-23          SECTION 6.06. Sections 415.0035 and 415.023 of the Labor Code
26-24    are amended to read as follows:
26-25          Sec. 415.0035.  Additional Violations by Insurance Carrier or
26-26    Health Care Provider.
 27-1          (e)  An insurance carrier or health care provider commits an
 27-2    administrative violation if that person commits a violation of a
 27-3    provision of this subtitle or commission rule, or violates an order
 27-4    or decision of the commission.
 27-5          (f)  A subsequent or repeat administrative violation as
 27-6    provided by this section, after prior notice of non-compliance, is
 27-7    subject to penalty as provided by Section 415.021 of this chapter.
 27-8    Prior notice is not required if the violation was committed
 27-9    wilfully or intentionally, or the violation was of a decision or
27-10    order of the commission.
27-11          Sec. 415.023.  Commission of Wrongful Act as Matter of
27-12    Practice; Administrative Violation. (a)  A person who commits an
27-13    administrative violation under Section 415.001, 415.002, [or]
27-14    415.003, or 415.0035 as a matter of practice is subject to an
27-15    applicable rule adopted under Subsection (b) in addition to the
27-16    penalty assessed for the violation.
27-17          (b)  The commission may adopt rules providing for:
27-18                (1)  a reduction or denial of fees;
27-19                (2)  public or private reprimand by the commission;
27-20                (3)  suspension from practice before the commission; or
27-21                (4)  restriction, suspension, or revocation of the
27-22    right to receive reimbursement under this subtitle; or
27-23                (5)  referral and petition to the appropriate licensing
27-24    agency to restrict, suspend, or revoke the license of the violator.
27-25          SECTION 6.07.  EFFECTIVE DATE. The change in law made by this
27-26    Act to Sections 415.0035 and 415.023 of the Labor Code is effective
 28-1    September 1, 2001 and apply to any violation that occurs on or
 28-2    after the effective date of this Act.