By Fraser                                             S.B. No. 1395
         77R5844 KSD-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the right of an insurance carrier to contest the
 1-3     compensability of an injury in a workers' compensation case.
 1-5           SECTION 1. Section 409.021, Labor Code, is amended to read as
 1-6     follows:
 1-8     REFUSAL; ADMINISTRATIVE VIOLATION. (a)  An insurance carrier shall
 1-9     initiate compensation under this subtitle promptly.  Not later than
1-10     the seventh day after the date on which an insurance carrier
1-11     receives written notice of an injury, the insurance carrier shall:
1-12                 (1)  begin the payment of benefits as required by this
1-13     subtitle; or
1-14                 (2)  notify the commission and the employee in writing
1-15     of its refusal to pay and advise the employee of:
1-16                       (A)  the right to request a benefit review
1-17     conference; and
1-18                       (B)  the means to obtain additional information
1-19     from the commission.
1-20           (b)  An insurance carrier who fails to begin the payment of
1-21     benefits or file a notice of refusal on or before the seventh day
1-22     after the date on which the insurance carrier is notified of the
1-23     injury does not waive the carrier's right to contest the
1-24     compensability of the injury but commits an administrative
 2-1     violation subject to Subsection (f).
 2-2           (c)  An insurance carrier shall notify the commission in
 2-3     writing of the initiation of income or death benefit payments in
 2-4     the manner prescribed by commission rules.
 2-5           (d) [(c)]  If an insurance carrier does not contest the
 2-6     compensability of an injury on or before the 60th day after the
 2-7     date on which the insurance carrier is notified of the injury, the
 2-8     insurance carrier waives its right to contest compensability.  The
 2-9     initiation of payments by an insurance carrier does not affect the
2-10     right of the insurance carrier to continue to investigate or deny
2-11     the compensability of an injury during the 60-day period.
2-12           (e) [(d)]  An insurance carrier may reopen the issue of the
2-13     compensability of an injury if there is a finding of evidence that
2-14     could not reasonably have been discovered earlier.
2-15           (f) [(e)]  An insurance carrier commits a violation if the
2-16     insurance carrier does not initiate payments or file a notice of
2-17     refusal as required by this section.  A violation under this
2-18     subsection is a Class B administrative violation.  Each day of
2-19     noncompliance constitutes a separate violation.
2-20           SECTION 2. This Act takes effect September 1, 2001, and
2-21     applies only to a claim for workers' compensation benefits based on
2-22     a compensable injury that occurs on or after that date. A claim
2-23     based on a compensable injury that occurs before the effective date
2-24     of this Act is governed by the law in effect on the date the
2-25     compensable injury occurred, and the former law is continued in
2-26     effect for that purpose.