TEXAS WORKERS` COMPENSATION UPDATE

Transcription

TEXAS WORKERS’
COMPENSATION UPDATE
Developments Impacting the Texas Workers’ Compensation System
December 22, 2015
Commissioner Brannan Says Texas Workers’ Comp System is Healthy, Large and Competitive
The Texas workers’ compensation system is “healthy, large and
competitive” according to Commissioner of Workers’ Compensation
Ryan Brannan. Brannan, who spoke at the Insurance Council of Texas’
2015 Workers’ Compensation Conference on September 24, 2015 and
gave an upbeat report on how the Texas system is performing.
“We have a strong and vibrant economy, and having a stable workers’
compensation system is an important part of making sure Texas
employers can continue to grow, and that employees can take care of
themselves and their families,” said Brannan. “We know that it is
possible to achieve high quality outcomes for injured employees while
keeping system costs as low as possible. Texas is proving that.”
Brannan noted that Texas is setting the standard for how for how to
identify issues, work with stakeholders to craft solutions, and to
implement those solutions. “I am committed to continuing to work with
all system stakeholders as we move forward with efforts to continue to
improve the Texas workers’ compensation system.”
ICT’s Executive Director, Albert Betts,
welcomes Workers’ Compensation
Commissioner Brannan to the Podium
at ICT’s 2015 Workers’ Compensation
Conference held on Sep. 24, 2015.
Brannan reported that the Texas workers’ compensation system is
performing better than it has in quite some time. He noted that the
Texas has seen significant improvement in the performance of its
workers’ compensation system.
“Only a decade ago, Texas was ranked near the bottom when measuring the cost of health care and the time
needed to resolve a disputed claim. Our performance has improved greatly,” said Brannan. “Our pharmacy
formulary is another example of how what we do here in Texas not only affects our system, but influences
other state workers’ compensation systems. Right now there are at least 4 other states considering adopting a
Texas-like pharmacy formulary in their states because of the results we’ve seen here in Texas.”
Brannan said workers’ compensation line of insurance in Texas is vibrant and growing.
“The most recent numbers show that, in 2013, 290 insurance companies had positive direct written premium
with a total direct written premium of about $2.66 billion, which is about a 9% increase from 2012,” said
Brannan. “A total of approximately 216,586 policies were written between this time period as well.”
Commissioner Brannan reported that since the 2005 legislative reforms, workers’ compensation insurance
rates have declined for Texas employers by more than 50%, making it more affordable for employers to
provide workers’ compensation coverage to their employees. “At the same time, workers’ compensation
insurance in Texas has been profitable for insurance companies – based on their combined ratios, insurance
companies made about a 10% underwriting profit, not including returns on investments,” said Brannan.
Continued on Page 8.
A Copyrighted Publication of the Insurance Council of Texas
The Insurance Council of Texas (ICT) has been following several significant developments that
impact the Texas workers’ compensation system.
The following developments are reported on in this edition of the Texas Workers’ Compensation
Update newsletter:
Articles
Page Number
Commisioner Brannan Says Texas Workers’ Comp System is Health, Large and Competitive
1
From the Executive Director of the Insurance Council of Texas
6
TDI Announces Retirement of General Counsel Sara Waitt: New General Counsel and Deputy
Commissioner of Legal Services Names
15
ICT Publishes 2nd Edition of the Texas Workers’ Compensation Appeals Panel Decisions Digest
17
Take Three Brownies and Call Me in the Morning
19
DWC Announces 1.1 Percent Increase for 2016 Medical Fee Guideline Conversion Factors
22
Workers’ Compensation News Briefs
23
Members of Congress Call for More Oversight of State Workers’ Compensation Programs:
Workers’ Compensation “Opt Out” Plans Raises Concerns
27
Column: DePaolo’s Work Comp World – The Wrong Focus
33
Richard Victor’s Achievement
36
DWC Releases 2015 PBO Results for Health Care Providers
40
DWC Accepting Comments on Proposed Revisions of Request for Travel Reimbursement Form
44
Featured Articles
Commisioner Brannan Says Texas Workers’ Comp System is Health, Large and Competitive
Page 1
Page 19
Members of Congress Call for Oversight of State Workers’ Comp Programs: Workers’
Compensation “Opt Out” Plans Raises Concerns
Page 27
The Wrong Focus
Page 33
ICT Honors 17 Students with Fall Scholarships
Page 48
Texas Workplace Injury, Illness Rate Decreased in 2014
Page 51
DWC Reports Preliminary Results Regarding 2014 Fata Occupational Injuries in Texas
Page 56
Division of Workers’ Compensation Announces Recent Enforcement Actions
Page 63
ALJ Rules that the Sky is not the Limit When it Comes to Air Ambulance Reimbursement
Page 71
Copyrighted Publication of the Insurance Council of Texas – December 22, 2015
Page 2
Articles
Page Number
Stone Loughlin & Swanson’s Workers’ Compensation Case Law News
45
48
DWC Accepting Comments on Proposed Revisions to DWC Form-042
51
51
DWC Reports Preliminary Results Regarding 2014 Fatal Occupational Injuries in Texas
56
DWC Considering Adopting a Compliant Form for Workers’ Compensation Insurance Related
Complaints
58
63
The DWC Recognizes Employers with Lone Star Safety Award
68
San Angelo Company Recognized for Exemplary Safety Program
68
Insurance Council of Texas Education Foundation
69
71
Insurance Commissioner Repeals Texas Retrospective Rating Plan Manual
73
Happy New Year from the Staff of the Insurance Council of Texas
74
Workers’ Compensation Events Calendar
77
Navigating ICT’s Newsletter Is Easy
Did you know that you can navigate ICT’s workers’ compensation newsletter by clicking on the page
number located in the table of contents?
Page 3
TEXAS WORKERS’ COMPENSATION UPDATE
A Copyrighted Publication of the Insurance Council of Texas
Albert Betts, Jr., Executive Director
Steve Nichols, Manager, Workers’ Compensation Services and Newsletter Editor
snichols@insurancecouncil.org
Cynthia Haywood, Assistant Newsletter Editor
chaywood@insurancecouncil.org
The Texas Workers’ Compensation Update, published by ICT Services, Inc., is Texas’ premier source
for news on developments in the Texas workers’ compensation system. The newsletter includes articles
written by Insurance Council of Texas staff and contributing authors who have extensive experience
with the Texas workers’ compensation system. The views expressed in articles that have been
contributed to the newsletter do not necessarily reflect the views, opinions, or position of the Insurance
Council of Texas or its member companies.
Comments and Inquiries:
Subscription Price:
$150 per year for electronic
subscription
Please send all comments or inquiries to Steve Nichols at the
following address, telephone number, or above referenced Email address:
No Cost for ICT Members
and Associate Members
ICT Services, Inc.
P.O. Box 15
Austin, Texas 78767-0015
Phone 512/ 444-9611 ● Fax 512/ 444-0734
Available as an electronic publication only.
Navigating ICT’s Newsletter Is Easy
Did you know that you can navigate ICT’s workers’ compensation newsletter by clicking on the page
number located in the table of contents?
Page 4
ADVERTISEMENTS INDEX
Advertiser
Page Number
ICT’s Texas Clips and Texas Insurance Newsletter
14
ICT’s 2016 Workers’ Compensation Seminar is Right Around the Corner
14
Medical Equation
16
PRIUM
18
The National WWII Museum
24
Smith & Carr, PC
25
Thornton Law Firm
26
Thompson Coe
31
Flahive Ogden & Latson
38
Downs Standford, P.C.
39
myMatrixx
41
Helios
42
Burns Anderson Jury & Brenner, L.L.P.
43
Stone Loughlin & Swanson, L.L.P.
46
WellComp
47
UniMed Direct
49
GENEX
50
York Risk Services Group, Inc.
54
Jopari Solutions, Inc.
55
Texas Committee on Insurance Fraud
59
Work Loss Data Institute
60
Coventry Workers’
61
Mitchell
62
Property Casualty Insurers Association of America
64
Insurance Council of Texas Associate Membership
65
Youg Risk Professionals of Texas
66
Genesis Medical Management Solutions
67
Hanna & Plaut L.L.P.
75
Medical Consultants Network
76
Page 5
From the Executive Director of the Insurance Council of Texas
THANKS FOR LETTING US BE YOUR VOICE IN TEXAS
As we close 2015, we want to thank our workers’ compensation member
insurers and associate members for their continued support, participation, and
assistance as we work to keep you informed on issues in Texas and represent
your interests before the Texas Department of Insurance. This was a busy year
as we monitored and reported on legislative discussions, hosted the annual
conference and spring seminars, and participated in numerous meetings and
discussions at the Division of Workers’ Compensation. We are honored to be
your representative and look forward to continuing to work with you in 2016.
We hope you all have a great holiday season and Happy New Year.
Albert Betts, Jr.
Albert Betts
Executive Director, Insurance Council of Texas
About the Insurance Council of Texas
The Insurance Council of Texas (ICT) is a non-profit trade association of property and casualty insurers
writing business in Texas. ICT's purpose is to provide a mechanism through which our members and
associate members can collectively represent their interests in the regulatory process and stay abreast of
those events that affect the business of insurance in Texas.
ICT represents its members at regulatory hearings effecting residential property and private passenger and
commercial auto, and workers' compensation insurance.
ICT's committee members and board of directors play an active role in developing regulatory proposals as
well as our responses to issues effecting the member companies.
ICT staff attend hearings and other insurance related meetings of the Texas Department of Insurance (TDI)
and TDI’s Division of Workers’ Compensation. Staff thereafter provides a prompt and accurate report of
the proceedings to our membership.
ICT publishes a monthly newsletter, "Texas Insurance Newsletter," that reports on important legislative,
judicial and regulatory events. We also publish the "Texas Workers' Compensation Update" and numerous
bulletins reporting on the ever changing workers' compensation rules and related regulations.
Page 6
Merry Christmas from the Staff of the Insurance Council of Texas
How We Celebrate This Most Wonderful Time of the Year
The United States of America has many different traditions and
ways that people in celebrate Christmas, because of its multi-cultural
nature. Many customs are similar to ones in the United Kingdom,
France, Italy, The Netherlands, Poland and Mexico.
The traditional meal for Western European families is turkey or ham
with cranberry sauce. Families from Eastern European origins favour
turkey with trimmings, keilbasi (a Polish sausage), cabbage dishes,
and soups; and some Italian families prefer lasagne!
How Else Do We Americans Celebrate Christmas?
Some Americans use pop-corn threaded on string to help decorate
their Christmas Tree.
In New England (the American States of Massachusetts,
Connecticut, Rhode Island, Vermont, New Hampshire and Maine),
there are shops called 'Christmas Shops' that only sell Christmas
decorations and toys all the year round.
People in America like to decorate the outsides of their houses with
lights and sometimes even statues of Santa Claus, Snowmen and
Reindeer.
Towns and cities often decorate the streets with lights to celebrate
Christmas. Perhaps the most famous Christmas street lights in the
USA are at the Rockerfeller Center in New York where there is a
huge Christmas Tree with a public ice skating rink in front of it over
Christmas and the New Year.
Customs such as Mumming take place in some communities. On
New Year's Day in Philadelphia there is a Mummer's Day parade
which lasts over six hours! Clubs called "New Years Associations"
perform in amazing costumes which take months to make. There are
four categories (Comics, Fancies, String Bands, and Fancy Brigades)
which are judged. You can find out more on the official website:
www.phillymummers.com.
C
Chheecckk T
Thheessee T
Tiippss oonn
In the Southwest USA, there are some special customs which have
some similarities to those in parts of Mexico. These include
'luminarias' or 'farolitos' which are paper sacks partly filled with sand
and then have a candle put in them. They are lit on Christmas Eve
and are put the edges of paths. They represent 'lighting the way' for
somewhere for Mary and Joseph to stay.
Learn more about how Christmas is celebrated around the world
here.
Page 7
Commissioner Brannan: Texas Workers’ Comp System is Healthy, Large and Competitive Continued
Commissioner Brannan pointed to several other system
performance as indicating that the Texas workers’
compensation system is performing very well following the
House Bill 7 reforms. He noted that:
● Injury rates and the number of claims filed have been
declining since the reforms.
● Non-fatal occupational injury rates have declined 28%
since 2005. And the number of workers’ compensation
claims filed has also declined, at a rate of 32% since
2004.
● System medical costs have stabilized from the doubledigit increase rates experienced in the early 2000’s.
Adjusted for inflation, current total costs are down by
29% since 2000.
● Approximately 67% of private Texas employers – that is an estimated 238,000 employers – and
approximately 80% of the private workforce in Texas – an estimated 7.7 million employees – have
workers’ compensation coverage.
● Almost half (48%) of new workers’ compensation claims are treated by certified networks or political
subdivision networks under Ch 504, Labor Code.
● More employees than ever before are returning to work after on-the-job injuries and they are off of
work for less time, meaning better productivity for Texas employers and less disruption for
employees.
● Currently, almost 77% of employees receiving workers’ compensation income benefits return to work
within 6 months, compared to 74% in 2004, and approximately 92% of injured employees return to
work within 2 years.
More Employers Are Participating in the Texas Workers’ Compensation System
Commissioner Brannan reported that despite workers’ compensation not being mandatory in Texas, more
employer are participating in the system.
“Even without a mandatory requirement for private employers to provide workers’ compensation coverage,
approximately 67% of private Texas employers – that’s an estimated 238,000 employers – and approximately
80% of the private workforce in Texas – an estimated 7.7 million employees – have workers’ compensation
coverag,” said Brannan.
“Keep in mind that only 10 years ago, our system had a 45% non-subscription rate,” noted Brannan. “Not only
are more employers subscribing to the workers’ compensation system, but also more than 75% of the
employers in key industries such as construction, manufacturing, mining, and agriculture are subscribers.”
Brannan said he intends to continue to keep the Texas system performing well by identifying the areas that still
need improvement and taking action to address those area of the system that can perform even better than they
are currently.
Page 8
Percentage of Texas Employers That Are Subscribers and Non-Subscribers: 1993 – 2014
Source: Survey of Employer Participation in the Texas Workers’ Compensation System, 1993 and 1995 estimates from the Texas Workers’
Compensation Research Center and the Public Policy Research Institute (PPRI) at Texas A&M University; 1996 and 2001 estimates from
the Research and Oversight Council on Workers’ Compensation and PPRI; and 2004 - 2014 estimates from the Texas Department of
Insurance Workers’ Compensation Research and Evaluation Group and PPRI.
Percentage of Texas Employees Employed by Subscribers and Non-Subscribers: 1993 – 2014
Source: Survey of Employer Participation in the Texas Workers’ Compensation System, 1993 and 1995 estimates from the Texas Workers’
Compensation Research Center and the Public Policy Research Institute (PPRI) at Texas A&M University; 1996 and 2001 estimates from
the Research and Oversight Council on Workers’ Compensation and PPRI; and 2004 - 2014 estimates from the Texas Department of
Insurance Workers’ Compensation Research and Evaluation Group and PPRI.
Page 9
Medical and Indemnity Disputes Are Down Significantly
Commissioner Brannan reported that the number of
medical and indemnity disputes have dropped
significantly.
“Since 2003, medical fee disputes have declined from
approximately 17,000 disputes per year to about 5,000
disputes per year,” said Brannan.” “Currently, we have
approximately 1,150 pending disputes pending at the
Division of Workers’ Compensation. Our goal is to
reduce this number even further – to under 1,000 by the
end of year, and we are on track to do so.”
The commissioner reported that that approximately
93% - 95% of workers’ compensation claims reported
to the Division of Workers’ Compensation never end
up in a dispute resolution proceeding.
“The vast majority of claims are handled and paid without a dispute arising,” said Brannan. “The Texas system
has seen a decline in the number of disputes regarding entitlement to income benefits. Since 2003, the number
of requests for dispute resolution has declined 77% to about 12,000 disputes per year. “That is a significant
drop in the number of disputes.”
Enforcement Activity Increased with Focus on Accurate Payment of Benefits
Commissioner Brannan reported that during 2014, the DWC’s System Monitoring and Oversight Program
handled more than 4,600 complaints, resulting in the return of over $1,070,000 to system participants and
issued 761 warning letters to system participants. He noted that there were 447 violations referred to the Texas
Department of Insurance’s Enforcement Division for enforcement action.
The commissioner noted that the DWC’s audits have focused on the timely and accurate payment of income
benefits and timely payment of medical bills.
“I am concerned about the accurate payment of benefits,” said Brannan. “We’ve found underpayments of
lifetime income benefits and death benefits and, as some of these underpayments are significant, we would
encourage carriers to make sure they are paying the right compensation rate and using the right employer wage
statement information.”
The commissioner reported that from January 1, 2015 – August 31, 2015 the DWC has assessed about
$1,204,800.00 million in penalties while resolving most of our enforcement cases within our goal of 180 days.
“Going forward, we will also be focusing our enforcement efforts on making sure that stakeholders submit
complete and timely medical records to designated doctors as required under our rules,” said Brannan. “Our
audits will continue to focus on reviewing benefit payments to ensure that the payments are accurate and
timely.”
The commissioner reported that the DWC Fiscal Year 2016 Audit Plan proposes 30 audits. “The System
Monitoring and Oversight Program will conduct 10 audits each on the initial payment of temporary income
benefits, medical bill processing, and the the accuracy of payments of death benefits and life time income
benefits,” said Brannan.
Page 10
Future Initiatives Announced
Commissioner Brannan announced that the DWC is evaluating options to improve injured employees’ access
to medical experts and has initiated a pilot project to educate injured employees about the worker’ compensation system and their rights.
“We are open to ideas from stakeholders on how to accomplish this without affecting the rights of other parties
to use their experts,” said Brannan. “In the past, we have offered to assist OIEC in finding expert testimony for
injured workers and will continue to do so. And some stakeholders have helped with this by providing experts
to OIEC on a pro bono basis.”
Advocates for injured employees have reported that the need for an injured employee to present expert medical
testimony at a contested case hearing is most often associated with an extent of injury dispute or preauthorization dispute. It has been reported that injured employees most often cannot obtain nor present an expert
medical testimony at contested case hearings.
Brannan said it is critical that the injured employee is well informed about the workers’ compensation system
and his or her rights in this system.
“As part of this need, we began a pilot program holding educational sessions in the San Antonio field office in
October 2014 and expanded the program statewide in January of this year,” said Brannan. “To this date, we
have held about 382 education sessions in our 20 field offices. These offer injured employees information
about the fundamentals of the workers’ compensation system and how to navigate the claims process.:
Focus on Workplace Safety
Commissioner Brannan annouced new initiatives aimed at improving workpalce safety that focus on the
construction and transportation industries.
“While Texas continues to have lower non-fatal occupational injury and illness rates compared to the rest of
the nation, the number of workplace fatalities in Texas is too high,” said Brannan. “Texas is blessed to have a
robust economy and good job growth, but as our industry mix changes, we need to redouble our efforts to
ensure that employees are safe on the job.”
The commissioner noted that there is a need to address safety issues that have led to fatalities within the
construction and transportation industries. He noted that the DWC has been focusing more resources on
improving workplace safety within the construction and transportation industries.
According to preliminary data from the U.S. Department of Labor, Bureau of Labor Statistics (BLS) released
by the DWC on September 17, 2015, transportation incidents continued as the leading cause of fatal occupational injuries in Texas, with 237 incidents (45 percent of the total fatalities). This was an increase of 4 percent
from 2013 (228 incidents). The construction industry also had a significant number of incidents that resulted in
fatal occupational injuries in the 2014 with the deadliest months for this industry being August and October, each
with 15 fatalities.
“DWC trainers are authorized by OSHA to perform its 10 hour construction outreach training course, which
provides information to employers about how to identify, abate, avoid, and prevent job-related hazards on a
construction site,” said Brannan. “Since 2013 the DWC has held 139 10-hour construction courses, instructing
1,649 employees from 666 employers.”
Page 11
Brannan also said, “The DWC offers this course for free in Austin, Houston, Dallas, and El Paso on a regular
basis, with San Antonio starting this fiscal year. DWC is also increasing the number of staff to provide this
training. The course is available in both English and Spanish, and attendees who complete the course receive a
completion card.”
Commissioner Brannan highlighted a program that the DWC is supporting – the National Safety Council’s
(NSC) Our Driving Concern: Texas Employer Traffic Safety Program which offers free train the trainer
programs to Texas employers. The program is funded through a grant from the Texas Department of
Transportation. The commissioner noted that the DWC has coordinated with the Insurance Council of Texas
(ICT) to have a speaker from NSC present an overview of the traffic stafety program at ICT’s workers’
compensation conference.
The Commissioner’s Vision for the Future of the Texas Workers’ Compensation System
Commissioner Brannan said that his focus going forward is to
keep the system stable, while identifying areas where
improvements can be made or where greater efficiencies can
be achieved.
Commisioner Ryan Brannan
“The DWC will continue its efforts to educate injured
employees about the system and their rights, including continuing our injured employee outreach program and working handin-hand with the Office of Injured Employee Counsel to ensure
that our agencies fulfill our missions,” said Brannan. “While we
are working to make our processes more efficient and educate
injured employees, DWC is also planning to continue its efforts
to highlight employer best practices for workplace safety. This
means recognizing those employers who make efforts to
prioritize safety and can serve as an example to other
employers.”
Brannan also noted other future initiatives that the DWC will be pursuing over the coming years, those
initiatives included:
● Continuing the DWC’s efforts to take a fresh look at some of the processes we use to assign
designated doctor examinations and the DD system in general;
● Continuing the DWC efforts to enforce violations of the Workers’ Compensation Act, especially in
situations where injuries or benefits are unreasonably being denied and bad faith fraud investigations
and prosecutions; and
● Looking for ways to encourage parties to come prepared for dispute resolution proceedings, including
ensuring that attorneys show up with the authority to make agreements in cases and making sure that
attorneys fulfill their ethical obligations to not drop client’s right before a proceeding if it will prolong
or adversely impact the client’s case.
Commissioner Brannan said the Texas workers’ compensation system of tomorrow will continue to be one that
performs better than most systems around the nation and will continue to be the system that other states look to
when attempting to implement successful initiatives to address prescription drug abuse, resolve disputes in an
efficient and timely fashion, and improve the performance of their state workers’ compenation system.
Page 12
Available to Insurance Council of Texas Members and Associate Members
Is your company or firm a member of the Insurance
Council of Texas (ICT)?
Texas Workers’ Compensation Update
If yes, did you know that you can request access to the
following ICT publications:
Workers’ Compensation Newsletter – the Texas
Workers’ Compensation Update;
Workers’ Compensation Bulletins,
State of the Texas Workers’ Compensation System;
Workers’ Compensation Legislative
Bulletins, and
Access to ICT’s Texas Workers Compensation Appeals
Panel Decisions Digest Online Electronic Manual?
Letter
Workers’
Compensation
Bulletins
Workers’
Comp
Bulletins
State of the
Workers’
Compensation
System
DWC
Appeals
Panel
Decisions
To Receive Access to These Publications, Contact Steve Nichols at snichols@insurancecouncil.org.
Workers’ Compensation Facts and Figures
There were 90 groups, 274 insurance companies with direct written premium for Workers' Compensation in
the third quarter of 2014, as compared to 95 groups, 286 companies, in the third quarter of 2013. See Page 24
of TDI’s 3rd Quarter edition of the Quarterly Legislative Report on Market Conditions.
TDI reported $963,813,648 of direct written premium for 4 quarters ending September of 2014.
TDI also reported the following quarterly experience for the 3rd quarter of 2014:
(1) Premiums on Policies Written – $651,661,866;
(2) Direct Written Premium – $695,477,386; and
(3) Direct Losses Paid – $262,406,870.
See page 25 of the Quarterly Legislative Report on Market Conditions.
According to the Texas Department of Insurance’s Workers’ Compensation Research and Evaluation Group,
(WCREG) workers’ compensation insurance rates decreased just over 50 percent from 2003 through 2013.
See page vii of the WCREG’s December 2014 edition of the Setting the Standard report.
During 2014, the Texas Department of Insurance’s Division of Workers’ Compensation (DWC) assessed
penalties totaling $2,086,395 in fines ordered against insurance carriers. The DWC assessed penalties totaling
$106,450 against health care providers, $45,000 against other entities and $1,000 against employers.
Page 13
Insurance Council of Texas Member Publications
ICT Members: Did you know that the following publications are available to you?
TEX-CLIPS is a daily clipping service provided by
the Insurance Council of Texas and can be found
on our website home page
www.insurancecouncil.org under ICT WIRE or
follow us on Facebook at ICT On Facebook.
TEX-CLIPS is available as part of your membership benefits.
Texas Insurance
Newsletter
The Insurance Council of Texas’ monthly newsletter
reports on developments impacting the Texas Property
& Casualty insurance industry.
ICT members and associate members can receive the
newsletter as part of their membership benefits.
Contact ICT at (512) 444-9611 to inquire how you can obtain access to these publications.
!
ICT’s 2016 Workers’ Compensation Seminar is Right Around the Corner
What Every Adjuster Needs to Know About How
to Request a Designated Doctor Examination
Come learn how to properly complete the DWC
Form-032, Request for Designated Doctor
Examination, and most common mistakes that
delay the approval of a request for an examination.
You will learn about the Designated Doctor
Process.
Solving the Average Weekly Wage Puzzle
The seminar registrants will learn how to properly
calculate the Average Weekly Wage (AWW), about
the most common errors made when calculating the
AWW, and what the consequences are when the
AWW calculation if not accurate.
Gain Additional Workers’ Comp Knowledge and CE
Credits
Come learn about other timely topics and developments that impact the adjusting of workers’ compen-
April 21, 2016
Austin, Texas
Page 14
TDI Announces Retirement of General Counsel Sara Waitt
New General Counsel and Deputy Commissioner of TDI Legal Services Named
Texas Department of Insurance General Counsel Sara Waitt is
retiring in December after 24 years with the agency.
“Sara has been a valued friend and legal colleague for the past two
decades,” said Texas Insurance Commissioner David Mattax, who
met Waitt when he was working on insurance issues at the Texas
Attorney General’s Office. “She has served both the agency and
state extremely well, and I wish her nothing but the best.”
Waitt and her staff helped finalize two large settlements for
consumers this year – a $353 million settlement signed with State
Farm Lloyds and an $84 million agreement with Farmers Insurance
Group.
Sara Waitt
Waitt and her staff helped finalize two large settlements for
consumers this year – a $353 million settlement signed with State
Farm Lloyds and an $84 million agreement with Farmers Insurance
Group.
“We were able to return money to consumers, and that’s a great feeling,” Waitt said. “I have loved my time
at this agency. The staff are smart, capable, and committed to doing what’s right for the people of Texas.
It’s been an honor and pleasure to work here.”
Waitt joined TDI in 1987 as a law clerk in the liquidation division. She left the agency twice to work at a
private law firm. She last returned to TDI in 1999 as the head of legal services and served as general
counsel under three insurance commissioners.
New General Counsel and Deputy Commisisoner of TDI Legal Division Named
TDI Chief Clerk Norma Garcia will become the commissioner’s general counsel, and Associate
Commissioner Stan Strickland will be the deputy commissioner over the TDI Legal Division.
Garcia has been a lawyer at TDI since 1998. Before that, she worked in the Office of the Attorney
General’s Financial Litigation Division. Garcia served as the general counsel of TDI’s Division of
Workers’ Compensation (DWC) from 2006 to 2008. She has a bachelor’s degree from Southern Methodist
University and a law degree from the University of Texas School of Law.
Strickland joined TDI as a staff attorney in 1996 and has been serving as head of the Legal Section since
2011. He served as the director of legal services for the DWC from 2006 to 2008. Strickland works closely
with the National Association of Insurance Commissioners and serves on the organization’s cyber security
task force. He earned his bachelor’s degree from Baylor University and his law degree from South Texas
College of Law in Houston.
Page 15
Page 16
ICT Publishes 2nd Edition of the Texas Workers’ Compensation Appeals Panel Decisions Digest
ICT has published the 2nd Edition of the Texas Workers’ Compensation Appeals Panel Decisions Digest (APD
Digest). The 2nd Edition of the APD Digest includes all significant decisions through the end of Calendar Year
2014. The 2015 significant decisions will be included in the 3rd edition of the APD Digest, which is scheduled
to be published in early 2016.
The APD Digest has been prepared by the Austin-based law firm of Burns, Anderson, Jury & Brenner, L.L.P.
(BAJB) and ICT and is available at no cost to BAJB’s clients and the members and associate members of ICT.
The digest has been reformatted to make it more user-friendly and includes an improved table of contents and
hyperlinks from the table of contents to sections within the manual. The 2nd Edition of the digest includes the
following new appendices:
●
●
●
●
Common Workers’ Compensation Abbreviations and Acronyms;
Deadlines for Notices, Reports, and Claims;
Workers’ Compensation Resources; and
Accurate Calculation of Average Weekly Wage, Income Benefits, and Death Benefits.
“The APD Digest is a one of a kind electronic publication that has been development with the adjuster and
attorney in mind,” said Steve Nichols, manager of workers’ compensation services at the Insurance Council of
Texas (ICT). “The manual allows workers’ compensation adjusters and attorneys to quickly research issues
related to benefits, impairment ratings and other legal issues associated with workers’ compensation claims.”
Nichols said that the Insurance Council of Texas has received feedback from its members and associate
members indicating that a high value is being place on the APD Digest as an excellent resource for insurance
adjusters and attorneys.
“One member company claims management professional thanked ICT for a “wonderful Christmas present”
and reported that he and his company’s adjusters would use to the manual to assist them with adjusting
workers’ compensation claims.
Nichols noted that one of the new appendices include important information about how to accurately calculate
an injured employee’s average weekly wage, income benefits and death benefits. Another new appendix lists
claims handling deadlines.
An ICT member or associate member that wishes to have their claims staff and/or attorneys provided with
access to the APD Digest should contact ICT’s webmaster.
ICT’s Workers’ Comp Newsletter Available to Member Employees
The Texas Workers’ Compensation Update newsletter is available to all
employees of Insurance Council of Texas member companies and
associate members. Sign your insurance professional up to receive the
newsletter.
Contact Steve Nichols, ICT’s Manager of Workers’ Compensation
Services at snichols@insurancecouncil.org to be added to the newsletter
distribution list.
Page 17
An Associate Member of the Insurance Council of Texas
Page 18
By Mark Pew, Senior Vice President, PRIUM
There have been two recent opinions and a study about
marijuana's use as medicine that has drawn my interest.
The studies are:
JAMA (The Journal of the American Medical Association)
published two separate studies in its June 23/30, 2015
edition that seem to offer insight into medical marijuana
use for chronic pain. "Medical Marijuana for Treatment of
Chronic Pain and Other Medical and Psychiatric
Problems" drew the conclusion from six trials of 325
patients there is "high-quality evidence" that marijuana
may be efficacious treatment for chronic pain. In
"Cannabinoids for Medical Use", only “moderate-quality
evidence" supported use for chronic pain. As with most evidence on medical use of marijuana, the results
are mixed and support for an opinion can be found with enough “googling.” Currently, both ODG and
ACOEM opine that cannabinoids are not recommended for any conditions based on the available evidence.
Chuck Rosenberg, acting chief of the Drug Enforcement Administration (DEA), on November 4 opined that
medical use of marijuana is a "joke". He did go on to say that "extracts or constituents or component parts
have great promise", but that didn't stop 100,000+ petitioners to ask for his resignation. He, and the DEA,
have somewhat walked back that statement and said "heroin is clearly more dangerous than marijuana," but it
certainly drew the ire of many people around the country. Not necessarily cause/effect, but Ted Lieu (D) of
California and eleven colleagues advocate that half of the $18M budget for the DEA's Cannabis Eradication
Program be redirected to other programs (FYI ... the DEA manages the scheduling of drugs and
thus responsible for marijuana being a Schedule I (illegal) drug).
David DePaolo, Chief Executive Officer, President and Editor in Chief of WorkCompCentral and daily
blogger on DePaolo's World, opined on November 19 that marijuana for medicinal purposes is bull****. In an
interesting analogy, he likens it to prescribing alcohol, and makes a compelling argument as to why that
analogy might fit. DePaolo is in favor of recreational legalization, so it's not the plant or effects but
the medicinal application that he doesn't agree with. DePaolo certainly doesn't mince words, but he is not
alone in his assessment of medical marijuana in the Work Comp industry. Beyond the fact that marijuana
remains illegal at the federal level, many payers do not agree with even the notion that marijuana is medicine.
Because New Mexico case law has opened up employers to the liability of reimbursing for medical marijuana,
effective January 1 there will be a fee schedule ($12.02 per gram, dry weight equivalent) and quantity (8
ounces per calendar quarter, 2 pounds (!) per calendar (year) established to provide structure to that process.
Read my blogpost, "New Mexico is #1!", published on August 11, 2015 for context.
Random thought ... Why is Work Comp being singled out among insurance payers for reimbursement? Is it
"bad" statute, "bad" case law, unintended consequences? Might getting your stash for free be an enticement to
have a workplace injury?
Obviously, medical use is an issue that needs to be addressed. When, not if, it is rescheduled to be legal, the
question then becomes whether it is "reasonable and necessary" medical treatment.
Page 19
Source: PRIUM
DePaolo’s blogpost was in tandem with an article written by WorkCompCentral’s Western Bureau Greg
Jones and published on November 19, 2015 (subscription required) that quoted me extensively on how to
assess the medical appropriateness of medical use of marijuana (in case it comes to that). With
somewhat contradictory medical evidence, "reasonable and necessary" is a subjective and individual
determination that is further complicated by:
● Not a defined dosage / potency - How many joints / hits on a bong / brownies / etc. are required to
address the underlying condition? With FDA-approved medications, a physician has specific
dosages (e.g. 5mg) and frequency (e.g. b.i.d. or twice per day) from which to choose. And will
prescribe the dosage and frequency he/she feels is most appropriate. And a pharmacist will know
precisely how to fill the dosage and quantity. And the patient will know what to take and when to
take it. Clinicians do not prescribe medical marijuana - they only certify or recommend - to protect
their DEA licensing to prescribe. According to Doris C. Gundersen MD, a glaucoma patient "would
need to smoke about a dozen “joints” per day for efficacy." So who provides guidance to the patient?
Their budtender?
Page 20
● Not a defined quality - In New Jersey, an Alternative Treatment Center (dispensary) needs to
confirm the lack of mold and pesticides in their product before being approved. Colorado has
specific labeling requirements to identify ingredients and to ensure "no false or misleading claims"
are made to health benefits (read starting on page 77). Which begs the question ... What is actually in
it? For FDA-approved medications, there is defined quality control built into the manufacturing
process, so that every 5mg tablet contains exactly 5mg of the expected ingredient. Unless the
medical marijuana is Marinol (dronabinol) or Cesamet (nabilone), both FDA-approved medications,
quality cannot always be guaranteed.
● Not a first line therapy - According to Dr. John Peterson (President of the Illinois Society of
Addiction Medicine), "for every disease and disorder for which marijuana has been recommended,
there is a better, FDA-approved medication." In other words ... The FDA has approved drugs for
treating specific conditions (on-label), clinicians have found other useful ways for drugs to help (offlabel), and evidence based medicine has ranked non-pharmacological treatment modalities based on
efficacy. Is medical marijuana "reasonable and necessary"? The starting point should be whether all
conservative mainstream options have been tried and failed. Dravet Syndrome (a seizure condition
that is often included in the explicit lists for legalized medical cannabis) has specific FDA-approved
prescription drugs, mostly anticonvulsants, that are recommended for use. Each of these drugs have
specific dosages and instructions for use. CBD, one of more than 85 cannabinoids in the marijuana
plant, has become an emotional argument for legalizing medical marijuana, but instructions for its
use is not as precise. The Dravet Syndrome Foundation (DSF) isn't yet convinced, saying "Until
there is more definitive scientific evidence concerning the safety and efficacy of CBD, DSF
recommends that all families continue to work closely with their treating physicians to make the best
decisions regarding medical care." Another quote from Dr. Gundersen about glaucoma hammers
home the point - "No study has demonstrated that marijuana can lower IOP as effectively as drugs
already on the market."
There are an increasing number of studies underway to identify,
in objective fashion, the benefits and risks for medical use of
marijuana. So there will be an increasing number of press
releases announcing "it works!" and "it doesn't work!". Random
thought ... How does a "randomized, double-blind, placebocontrolled prospective study" work when half of the participants
get stoned?
This is a tricky subject because an argument can be made for
and against. And many of those arguments are personal because
they represent individuals who either have received medical
benefit or those who think it's bull****. I have presented on this
subject 49 times around the country since 3/24/14, and because
of that have spoken to people on both sides of the issue. There
There are nuances to this argument, and over the past 20 months my understanding has increased and my
opinion has evolved.
So, for what it's worth ...
My personal opinion: Marijuana used for medical purposes may be appropriate for some people with some
conditions for some time, but if its use is not preceded by trials of FDA approved drugs and/or conservative
treatment recommended by EBM, it's probably not "reasonable and necessary".
Page 21
Editor’s Note: Mark Pew, a senior vice president with PRIUM and the
author of the article, has more than 35 years of experience in the property
and casualty, healthcare and technology industries. He created PRIUM’s
Medical Intervention Program in 2003, Intervention Triage in 2010,
Texas Drug Formulary turnkey solution in 2011, Centers with Standards
in 2012, and TaperRx in 2014. Mark is a popular speaker at workers’
compensation conferences around the country as well as individual
continuing education venues. He has spoken at the National Workers’
Compensation and Disability Conference, National Rx Drug Abuse
Summit, at statewide or self-insured conferences in 23 states, and at
national and regional association gatherings around the country. From
March 2012 thru November 2015, Mark presented educational content
296 times to 18,370 people in 39 states, including 9 national webinars. A
Mark Pew
frequent media source for stories on pharmacy, chronic pain and
marijuana in workers’ compensation, Mark is a regular contributor to Claim Management Magazine,
Insurance Thought Leader and LexisNexus. He also publishes thought-provoking articles and posts on
LinkedIn and @RxProfessor.
Mark serves on the Medical Issues Committee of the International Association of Industrial Accident Boards
and Commissions (IAIABC), the Workers’ Compensation Committee for the Self-Insurance Institute of
America (SIIA), the Medical/Rehab Committee for the Southern Association of Workers’ Compensation
Administrators (SAWCA) and the Pharmacy Group for CompSense. In addition, he serves as a technical
advisor to multiple jurisdictions on subjects such as drug formularies, treatment guidelines and medicinal use
of marijuana.
DWC Announces 1.1 Percent Increase for 2016 Medical Fee Guideline Conversion Factors
On November 17, 2015, The DWC announced that for services
provided in calendar year 2016, the new Medical Fee Guideline
conversion factors are $56.82 and $71.32. The conversion factor
of $56.82 applies to service categories of evaluation and
management, general medicine, physical medicine and
rehabilitation, radiology, pathology, anesthesia, and surgery when
performed in an office setting. The conversion factor of $71.32
applies to surgery when performed in a facility setting.
A table reflecting the conversion factors from 2008 through 2016
can be found on TDI-DWC’s website at the following address:
http://www.tdi.texas.gov/wc/fee/documents/conversions.pdf.
Section 413.011(a) of the Texas Labor Code requires that the DWC adopt fee guidelines for non-network
services and approved out-of-network services based on the most current reimbursement methodologies,
models, and values or weights used by the federal Centers for Medicare and Medicaid Services.
To provide predictability and reflect changes in medical service delivery costs to system participants, the DWC
established a conversion factor and an annual update as part of Rule 134.203(c). The annual update is based on
the Medicare Economic Index (MEI), which is a weighted average of price changes for goods and services
used to deliver physician services.
Page 22
WORKERS’ COMPENSATION NEWS BRIEFS
New York City, New York, December 10, 2015 – Business Insurance reported that the Texas Supreme
Court's recent ruling in Kingsaire Inc. d/b/a Kings Aire Inc. v. Jorge Melendez highlights the importance of
employers running federal Family and Medical Leave Act benefits concurrently with workers compensation.
Eaglewood, Colorado, December 11, 2015 – Insurance Business America reported that a new study from the
Workers Compensation Research Institute indicted that the Affordable Care Act’s creation of accountable care
organizations (ACOs)—a network of doctors and hospitals—creates a powerful financial incentive to shift cases
to workers’ comp.
New York City, New York, December 2, 2015 – The Wall Street Journal reported on the need for workplace
rules to evolve for the sharing economy to grow while protecting workers. The article noted that employees
working in the shared economy would not be covered by federal overtime or minimum wage laws, workers’
compensa-tion and unemployment insurance, none of which are well suited to how independent workers
operate. They would, however, be protected by federal anti-discrimination laws, and could be pooled with
other workers so that the employer could obtain health insurance more cheaply for them.
Camarillo, California, December 4, 2015 – WorkCompCentral reported on a series of large court verdicts
against non-subscriber employers and response of the non-subscriber community to the verdicts. (Subscription
Required to read the article)
Austin, Texas, December 1, 2015 – Texas Mutual Insurance Company (Texas Mutual) announced that it has
paid more than $3 million in early qualifier dividends to approximately 4,000 newer workers’ compensation
insurance policyholder owners across the state. This payout is the final component of Texas Mutual’s $225
million dividend distribution in 2015.
Sacrmento, California, November 30, 2015 – WorkersCompensation.com reported that in response to a series
of articles by ProPublica and NPR that have been highly critical of workers’ compensation non-subscription
plans, the National Conference of Insurance Legislators (NCOIL) said it will look into an effort by some of the
biggest names in corporate America to opt out of workers’ compensation.
Dallas, Texas, November 16, 2015 – The Dallas Morning News reported that federal prosecutors had federal
prosecutors announced that they have filed criminal charges against 28 people involved in a “complex and
sprawling workers’ compensation health care fraud scheme” that cost the government $8.7 million. The
defendants included doctors and medical providers, independent claims consultants, a senior claims examiner
for the federal Department of Labor, and 21 people who said they had injuries preventing them from returning
to work.
Camarillo, California, October 27, 2015 – WorkCompCentral reported on controversy that has arisen about
Travis County District Attorney’s Office prosecuting fraudulent claims filed against Texas Mutual Insurance
Company. (Subscription Required to read the article)
San Diego, California, October 19, 2015 – The Claims Journal reported that more state workers’
compensation systems are looking at closed drug formularies as a way to control both the utilization and costs
associated with prescription drugs.
Austin, Texas, September 16, 2015 – The Texas Department of Insurance’s Division of Workers’ announced
the recertification of 11 employers to self-insure workers’ compensation claims. Together, the companies
employ about 50,000 people in Texas.
Page 23
The National WWII Museum in New Orleans opened on June 6, 2000, as
The National D-Day Museum. Founded by historian and author, Stephen
Ambrose, the Museum tells the story of the American Experience in the
war that changed the world — why it was fought, how it was won, and
what it means today — so that all generations will understand the price of
freedom and be inspired by what they learn.
2
Designated by the U.S. Congress in 2003 as the America’s National WWII
Museum, the campus includes the Louisiana Memorial Pavilion,
showcasing large artifacts of the war and exhibits on D-Day at Normandy,
the Home Front and the Pacific; the Solomon Victory Theater, a 4-D
theater showing the exclusive Tom Hanks production, Beyond All
Boundaries; the Stage Door Canteen, where the music and entertainment of
the “Greatest Generation” comes to life; the John E. Kushner Restoration
Pavilion where staff and volunteers restore artifacts in public view; and the
American Sector restaurant and Soda Shop — delicious onsite dining
options by Chef John Besh.
The museum founder, historian Stephen E. Ambrose’s (January 10, 1936 –
October 13, 2002) efforts resulted in the opening of an unparalleled
museum in New Orleans, Louisiana. Ambrose wrote an acclaimed, multivolume biography of Dwight “Ike” Eisenhower’s presidency and his
service as the Supreme Commander of the Allied assault on Nazi Germany.
Ambrose also other bestseller history books about World War II. These
include: Band of Brothers, D-Day, Wild Blue and Citizen Soldiers. He was
the military advisor for the movie Saving Private Ryan and served as an
executive producer for the award winning HBO mini-series Band of
Brothers.
Stephen Ambrose inspired and guided the development of The National
WWII Museum until his passing in 2002. His dream of a museum honoring
our nation’s “Greatest Generation” reflected his deep regard for our
nation’s citizen soldiers, the workers on the Home Front and the sacrifices
and hardships they endured to achieve victory.
Help Honor America’s Greatest Generation
The generation of Americans who came to adulthood during the 1930s
grew up in a world shadowed by extraordinary economic and military
threats. A financial depression gripped much of the globe, throwing
millions out of work. In some countries, economic hardship contributed to
the power and appeal of political extremists. These leaders offered simple
solutions to their countries’ problems, solutions that included extreme
nationalism, military expansion, and doctrines of racial superiority.
America’s “Greatest Generation” answered the call to arms. They fought,
defeated the Axis powers and preserved Democracy.
In September of 2012, the National WWII Museum joined with the
Insurance Council of Texas to honor the Texas insurance industry’s WWII
veterans.
Take an Online Tour of the Museum
View NOLA TV’s video about The National World War II Museum Here
and the museum’s Fly-Thru Video Here. Listen to Tom Hanks talk about the
National WWII Museum. Plan your visit to the museum today.
Page 24
Collective Years of Legal Experience
SMITH & CARR, P.C.
ATTORNEYS AT LAW
MoreInformationAbouttheFirm
(Right Click on Information Topics)
Representative List of Clients
Seminars Information
Attorney Profiles
SMITH & CARR, P.C. is a litigation boutique founded by Stephen T.
Smith and Charles M. Carr, III. Their collective years of legal experience
provide a background for the handling of claims in both judicial and
administrative forums, as well as the alternative dispute resolution
process.
Smith & Carr, P.C. is dedicated to providing efficient economical and aggressive
representation of its clients in both litigation and administrative matters. The
firm's strength lies in its collective years of legal experience together with a solid
work ethic based upon the belief that providing cost effective legal
representation is paramount. The firm's attorneys concentrate on trials and
appeals in state and federal court, as well as before administrative tribunals.
SMITH & CARR, P.C. Primarily handles personal injury defense (insurance
defense), insurance coverage, employment and commercial issues. Areas of
practice include:
Employment:
Defense of employers in litigation involving
Americans With Disabilities Act, Fair Labor
Standards Act, Family Medical Leave Act,
Hour/Wage and Unemployment claims,
Retaliatory Discharge and Wrongful
Termination.
Insurance:
Defense of insurance carriers in Bad Faith and
Deceptive Trade Practices/Consumer Protection
litigation, Coverage Opinions, Declaratory
Judgment Actions, and Insurance Subrogation.
Personal Injury:
Defense of insured's in litigation involving
Automobile, Construction Liability, Employer's
Liability, Jones Act/Maritime, Longshore and
Harbor Workers' Compensation Act, Defense
Base Act, Premises Liability, Products Liability,
Trucking and Workers' Compensation.
Professional Injury: Accounting, Insurance Agent and Insurance Claims
Malpractice.
The attorneys of SMITH & CARR, P.C. are licensed to practice law in the courts
of the States of Texas, Louisiana and Oklahoma. They are also licensed in
federal courts in Texas and Louisiana.
Smith & Carr, P.C.
900 Woodway, Suite 1200
Houston, Texas 77056
Phone: 713.933.6700
Facsimile: 713.933.6799
Email : info@smithcarr.com
Website: www.smithcarr.com
Page 25
Page 26
Members of Congress Call for More Oversight of State Workers’ Comp Programs
Workers’ Compensation “Opt Out” Plans Raises Concerns
On October 20, 2015, ten prominent Democratic lawmakers,
including presidential candidate Sen. Bernie Sanders (DVermont) and Sen. Al Fraken (D-Minnesota), wrote and
signed a letter to U.S. Labor Secretary Thomas E. Perez and
asked that the Department of Labor come up with a plan to
ensure that state workers’ compensation programs are
properly caring for injured workers.
The letter was prompted by an investigation by ProPublica
and NPR, which found that more than 30 states have cut
benefits to injured workers, created daunting hurdles to
getting medical care or made it more difficult for workers
with certain injuries and illnesses to qualify.
The letter also cited a ProPublica and NPR news article that
detailed a campaign by some of the biggest names in
corporate America to let companies “opt out” of workers’ compensation and adopt non-subscription plans with
their own rules and benefit levels.
Workers’ compensation laws in Texas and Oklahoma allows employers to “opt out” of workers’ compensation. The option is under serious consideration in Tennessee and South Carolina.
A U.S. Department of Labor (DOL) spokesperson reported that the DOL was reviewing the letter and shared
the members’ concerns.
“Every year injured workers and their families are bearing more and more of the cost of workplace injuries and
illnesses,” the department said. “American workers and their families deserve the peace of mind that comes
with knowing a workplace injury won’t knock them out of the middle class, and we look forward to working
with stakeholders to find real solutions.”
Propublica reported that U.S. Representative Bobby Scott (D-VA) said said the cost shifting to federal
programs underscores that there is a strong federal interest in making sure the workers’ compensation
programs pay appropriate benefits. Rep. Scott also told Propublica that he is concerned about “harsh
restrictions in the benefit plans of some companies that had opted out of workers’ comp, particularly one that
requires employees to report an injury by the end of their shift or lose their benefits.”
Propublica and NPR are not the only organizations that have written about workers’ compensation “opt out”
plans. Texas Tribune has also published an article about the movement to expand workers’ compensation “opt
out” plans across the nation.
The Texas Tribune article focused on Dallas attorney Bill Minnick who champions workers’ compensation
“opt out” plans and has launched an effort to expand the “opt out” option to other states. Minnick is backed by
backed by some of the biggest names in corporate America. Those companies include Albertson’s, Costco,
Domino’s Pizza, The Home Depot, J.B. Hunt, Macy’s, Sears, Target, and Walmat.
Texas Tribune reported that ProPublica and NPR obtained the injury benefit plans of nearly 120 companies
who have opted out in Texas or Oklahoma — many of them written by Minick’s firm — to conduct the first
Page 27
independent analysis of how these plans compare to state workers’ comp. Texas Tribune reported that
Propublica and NPR’s “investigation” revealed that the “opt out” plans almost universally have lower benefits,
more restrictions and virtually no independent oversight.
“Opt Out” Public Policy Analysis Provides First Look at Non-Subscription Plans and Benefits
A public policy analysis paper prepared by Bill Minnick of Partner Source provides an overview of how “nonsubscription” plans adopted by employers who “opt out” of workers’ compensation works. Minnick noted that
employers can and do provide better benefits and take better care of their injured employees when they “opt
out” of workers’ compensation and adopt a non-subscription plan.
“By electing to leave or not join the Texas workers’ compensation system, an employer rejects workers’
compensation system networks, benefits, forms, processes, etc., and replaces them with its own injury benefit
program.” said Minnick. “The general premise is that an employer can and typically will take better care of
injured workers, at a lower cost, in a free-market system than in a hyper-regulated, government-centric
program. The Option creates broad, free-market competition with workers’ compensation insurance markets,
within a simple statutory framework of employee protections.”
Minnick reported that non-subscribers generally pay higher wage replacement benefits than Texas workers’
compensation. He noted that the non-subscribing employer’s generosity in wage replacement benefits is
supported by the requirement for immediate injury reporting (by the end of the work shift or next day – subject
to a good cause exception), in contrast to a 30-day window for injury reporting under Texas workers’
compensation.
The policy paper noted that while non-subscribers do not utilize all of the tools available to achieve the best
medical or financial outcomes, non-subscribing employers still substantially outperform workers’
compensation on both fronts.
Minnick also reported that non-subscribing employers are found in virtually every business industry. He noted
that they include employers from the retail, healthcare, food service, hospitality, manufacturing, and transportation and range in size one to over 100,000 Texas employees.
The policy paper noted that the overwhelming majority of non-subscribers have fewer than 50 employees. He
noted that there are over a dozen non-subscribers who have more than 10,000 Texas employees, and that over
two dozen nonsubscribers are Fortune 500 companies.
Minnick reported that employers that elect the Texas non-subscription plan option can fully or partially selffund or insure injury benefits and negligence liability judgments, settlements and expenses related to an
employee injury claim.
“Employers commonly purchase insurance coverage to reimburse them to the extent such claim costs exceed a
certain self-insured retention or deductible amount,” wrote Minnick. “Virtually any level of employer retained
risk is available, and insurance coverage limits can be achieved up to tens of millions of dollars. Many
employers also have their excess or umbrella insurance sit above an Option policy.”
Minnick reported that many “A” rated, financially strong insurance companies presently offer insurance
specifically tailored to the needs of Option employers. This is a highly competitive marketplace that generates
well over $100 million of annual premiums.
The policy paper noted that the insurance policies purchased by non-subscribers provide coverage for a wide
range of benefits in the event of a work-related accident, occupational disease, or cumulative trauma. Such
Page 28
benefits coverage commonly includes medical, disability, death and dismemberment. Coverage is also
commonly written for employer’s negligence liability or benefits liability settlements, judgments and defense
costs in the event an injured employee threatens, files or succeeds in winning a lawsuit in state or federal court
or arbitration.
Minnick reported that there are many national and regional third party administrators (TPA) that have
dedicated, specialized resources for handling workers’ compensation non-subscription claims. He noted that
the TPAs are supported by dozens of other companies that provide medical provider networks, medical
management and bill review services, claim investigation services, litigation management and defense,
information services, software, and other products and services.
The public policy paper noted that the key features of all non-subscription plans subject to ERISA include the
process for filing a claim; an initial benefit determination by the employer or insurance carrier and notification
to the employee; right to an internal appeal of any denial of benefits; and access to the courts for an external,
independent review of any denial of benefits.
Minnick reported that benefit disputes that cannot be resolved through the internal administrative processes can
proceed to state or federal district court. ERISA provides that state courts of competent jurisdiction and district
courts of the United States shall have concurrent jurisdiction of actions “to recover benefits due to him under
the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits
under the terms of the plan.”
The public policy paper include the following overview of the non-subscription benefit appeals process for
Texas non-subscription plans:
Page 29
The public policy paper provided an overview of ERISA reporting requirements, U.S. Department of Labor
enforcement and oversight of ERISA-based non-subscription plans, and the following broad comparison of the
performance of the Texas workers’ compensation system and Texas non-subscripton performance:
Estimated Annual Claims Count
Injury Reporting Requirement
Percent Returning to Work within
Six Months
State Expense to Administer and
Oversee Claims
State Employees Required
Texas Workers’ Comp
200,000
Within 30 days
83%
Texas Non-Subscription Option
50,000
Within 24 hours
96%
$35 million
$0.00
517 FTEs
None
Note: See the foot notes associated with this table on page 49 of the public policy paper.
The public policy paper includes other interesting data and information about how the performance of the
Texa workers’ compensation system compares with Texas non-subscription plans on pages 52 through 54.
The public policy paper concluded with the following statement:
“History has a way of eventually sorting out matters of self-interest that are bad for employers AND bad for
injured workers. Texas lawmakers that have embraced the nonsubscriber Option have been shown to be on the
right side of history.”
What Are the Critics of the “Opt Out” Option Saying?
Critics of the workers’ compensation “opt out” option focus most of their complaints on the “disparity that
exists between workers’ compensation benefit levels and duration as compared to those of non-subscription
plans.”
Other criticism of non-susbscription plans include:
● Many opt-out plans require a person to report her or his injury immediately or lose access to benefits.
Peter Rousmaniere, a columnist often featured by WorkCompCentral, noted that such provisions of nonsubscriber plans may violate not only the standards of ERISA (see Heimeshoff v. Hartford Life and
Accident Insurance Company, 2013) but also the “interactive process” standard of federal disability law.
● The income benefit levels of many non-subscriber plans are significantly lower then the income benefits
provided for by state workers’ compensation laws.
Rosmaniere wrote in a recent WorkCompCentral column article that some plans have limits on weekly
wage-replacement benefits so low as to suggest the plan designers want to deter high-wage earners from
filing claims.
● Most of the non-subscription plans place limitations on on medical benefits.
Rosmaniere noted in his column article that Walmart’s benefit plan warns the injured worker that if she
sees her or his own doctor to discuss the injury, the company may terminate all injury benefits. Other
Continued on Page 32.
Page 30
Page 31
Continued from page 30…
critics of non-subscription plans have reported that the plans set a dollar limit cap on how much the plan
will pay for medical benefits. Those critics noted that once the dollar limit cap is reached, medical
benefits are “cut off.”
The critics of non-subscription plans also allege that those plans typically severely restrict provider
choice for injured workers. Rosmaniere and critics of non-subscription plans have noted that if an
injured employee who is covered by a non-subscription plan seeks medical treatment from a physician
not included in the plan’s panel of physicians, the the company may terminate all injury benefits.
● Many plans exclude specific occupational injuries and conditions.
Propublica reported that McDonald’s plan doesn’t cover carpal tunnel syndrome while Brookdale Senior
Living, the nation’s largest chain of assisted living facilities, doesn’t cover most bacterial infections.
Propublica noted in its October 14, 2015 article that reports on workers’ compensation “opt out” and
non-subscription plans that many plans typically do not pay for wheelchair vans, exposure to asbestos,
silica dust or mold, assaults unless the employee is defending “an employer’s business or property,”
chiropractors or any more than 75 home health care visits.
● Unlike traditional workers’ compensation insurance which guarantees lifetime medical care, the Texas
plans cut off treatment after about two years.
Propublica reported that the plans do not include any provision for the payment of compensation for
most permanent disabilities and strictly limit payouts for deaths and catastrophic injuries.
● Several plans exclude injuries from being covered when there has been safety violations or the failure to
obtain assistance for a particular task.
Probublica reported that several companies, including Home Depot, Pilot Travel Centers and
McDonald’s, include such a provison in their respective workers’ compensation non-subscription plan.
NCOIL to Investigate Workers’ Compensation “Opt Out” Plans
The National Conference of Insurance Legislators (NCOIL) plans to investigate workers compensation opt-out
programs in the wake of media reports examining such alternative plans in Texas and Oklahoma. NCOIL's
Workers' Compensation Insurance Committee voted at its annual meeting last month to investigate opt-out
programs.
“Though NCOIL has taken no position on these unique programs, we'd be remiss if we didn't look at the issue
further — especially since there's movement in other states to let employers opt out of state workers' compensation requirements,” North Dakota Sen. Jerry Klein said in the statement. Sen. Klein, a Republican, is
chairman of NCOIL's workers comp committee.
What is Next?
The focus on the workers’ compensation “opt out” option and non-subscriber plans has not dampened the drive
to expand non-subscription beyond the borders of Oklahoma and Texas. Without a doubt, the proponents of the
“opt out” option will continue their efforts to get legislation passed in other states that provide employers with
the option to drop workers’ compensation insurance coverage and replace it with a non-subscription plan.
Page 32
Column: DePaolo's Workers’ Comp World
The Wrong Focus
By David DePaolo, CEO, President, Editor-in-Chief, WorkCompCentral
WRONG
The recent $2.2 million jury award against non-subscriber
Tyson Foods in Texas for a back injury had
WorkCompCentral legal reporter, Sherri Okamoto, ask
whether that, and other recent awards, has caused the opt out
community to take pause.
Some of the examples cited by Okamoto:
In 2014, a McLennan County jury handed down a $12.1
million verdict against the Tractor Supply Co. of Texas –
which was one of the largest awards ever made to a single
individual in the jurisdiction.
In January, the state's 7th District Court of Appeals affirmed a
$5.3 million liability judgment against West Star
Transportation for a driver's brain injury from falling headfirst
from an unevenly loaded flatbed trailer.
Then in July, the 14th DCA upheld a $1,016,809 judgment in favor of a meat cutter who lost three fingers in an
industrial accident.
And in September, the 14th DCA approved of an award of $769,627.02 to a worker for his injuries from a
mishap while operating a machine that was reeling in a piece of large-gauge wire.
So do these eye popping awards cause Texas non-subscribers to rethink the decision not to buy into the
workers' compensation system?
The basic answer she got was "no."
The underlying reason is that the employee in a Texas non-subscriber case has the initial burden of proof to
show negligence on the part of the employer - and that just doesn't happen very often because safety
protections and awareness has been elevated to the best performance levels ever.
In addition, those employers opting out of Texas' system and subject to those kind of awards have the
resources, management and experience to calculate the risks and do a cost comparison and have determined
that the benefit of controlling their own processes outweighs the risk of those big awards.
The fact that Texas is not compulsory for workers' compensation has always been a hot topic of debate in the
state.
Non-subscribers enjoy their freedoms. And they say that doing so places competitive pressure on the workers'
compensation system to stay efficient and affordable.
Page 33
The state's history over the past couple of decades would seem to bear that out - when Texas workers'
compensation insurance is relatively expensive the rate of non-subscription (although not necessarily the rate
of alternative benefit plans) increases, and when the cost of insurance is relatively inexpensive nonsubscription wanes.
I have had a tough time understanding why insurance groups would be opposed to non-subscription though.
The Property Casualty Insurance Association has been a vocal opponent of opt-out for years. I thought they
would, at the least, be neutral on the topic, because in my mind insurance is insurance - and if you can't sell
one kind of policy, then you sell another kind of policy.
But the opposition remains. Trey Gillespie, whom I've known for some time, is the senior workers'
compensation director for PCI. He states that PCI's objection to non-subscription is that it's bad public policy
because it upsets the competitive market for the industry the non-subscriber participates in and that "they're not
really providing the protections envisioned by workers' compensation."
That argument is also made by labor. Rick Levy, the secretary-treasurer of the Texas AFL/CIO and formerly
its general counsel, has been a vociferous proponent of making workers' compensation compulsory in Texas
for as long as I've known him.
Levy's argument against non-subscription mirrors Gillespie's, but with more of a Labor twist - Levy can cite
many cases where an irresponsible employer left injured workers high and dry, upsetting the balance of the
employer-employee relationship, particularly since most employees are not fully aware of the consequences of
inadequate work injury protection systems.
Another argument against non-subscription is that costs are unfairly shifted onto other public benefit systems.
That argument is made against workers' compensation too, and curiously also gets inverted ... I don't think
anyone accurately can state whether one system shift actually occurs over another system shift. I've never seen
a convincing study that tracks real dollars attached to a claimant (or a cohort of claimants) from one system to
another.
Non-subscription has always been a part of the Texas work-injury protection culture. Things are just different
in that state. When the concept migrates across state lines it takes on a different character because it butts up
against compulsory obligations - in Oklahoma, as you are likely well aware, that obligation requires that optout have the same minimal protections that workers' compensation provides.
There's quite a bit of argument over what that exactly means, and the opt-out movement has been on the
defensive for the past year as plans become public and critics challenge whether those plans in fact meet that
minimal standard.
That minimal standard, though, has shifted over the years and after many reforms in many states. The
ProPublica series about work injury protection systems points that out quite clearly - the original promises
made to Labor have been compromised over time and that's what the anecdotes (and frankly the data) suggest.
Whether workers' compensation is compulsory, whether an employer opts-in or opts-out - these are red herring
arguments and mean nothing at the end of the day for the injured worker trying to get medical care and figure
out how to pay his or her bills.
The test is whether the employer is sufficiently vested in its work force to ensure employees are sufficiently
protected against the risks of earning a living at the direction and control of another.
Page 34
The more I hear the arguments, the more both sides seem to be saying the same thing, and both of them are
focused on exactly the WRONG thing: saving money.
When the focus is on costs, only costs matter, and that means that the assets (employees) get short shrift.
Cost centric employers count the trees in the forest. The problem is that they don't count all of the forests.
Work injury protection is not just about avoiding a bad jury verdict, or controlling medical treatment, or
limiting exposure to some mandated annuity.
The bigger picture is missed - when a worker is hurt on the job and doesn't return that job will either be
restaffed at considerable expense, or the work doesn't get done ... at considerable expense.
And a job that doesn't get done means one less dollar going back into the consumer spend stream, which
ultimately means one less dollar to support the business at which that worker got hurt.
The arguments can't be about costs, can't be about control, can't be about shifting obligations - the argument at
the end of the day is whether the injured worker is adequately protected against bad things at the work place.
It is up to Business/Industry to figure out how to best provide that protection. And its up to government to say
whether or not the solution provided is adequate.
What it really comes down to is does the public trust government to do the right thing? Opt-out folks don't.
There are a lot of work comp folks that don't either.
About the Author
David DePaolo is the author of this column. After practicing workers'
compensation law for nearly 18 years, David founded and grew
WorkCompCentral into the most respected news and education service
in the workers' compensation industry. He publishes a popular blog
“DePaolo’s Work Comp World”.
David is a regular public speaker on workers' compensation to industry
trade shows, educational seminars, radio and television, and have been
quoted or cited in general media publications such as Fortune
Magazine, the LA Times and Wall Street Journal. He has been
published in leading industry journals and scholarly publications on
topics ranging from the underlying financial issues that led to an
historic makeover of the California workers' compensation system, to
the new paradigm in work injury protection and national trends in the
workers' compensation industry.
The views expressed in his article are those of the author and should
not be misconstrued to be those of the Insurance Council of Texas. The
article includes hyperlinks to WorkCompCentral articles that require a subscription to access and read.
David DePaolo
Texas Workers’ Compensation news from WorkCompCentral is available every single day for as little as
$11.53/month (annual subscription price).
Page 35
Richard Victor's Achievement
By Peter Rosmaniere, Featured Columnist, WorkCompCentral
Richard Victor retires this month as president and chief
executive officer of the Workers’ Compensation Research
Institute, bringing to a close 32 years of honest and clear
leadership on how to think about work injuries.
Victor led industry practitioners and regulators to making injury
response more transparent and intelligible. His most important
legacy is, I think, to induce industry participants to act in a more
accountable way among themselves and to society at large. The
workers’ comp system’s treatment of injured workers is under
the most severe scrutiny since the early 1970s. In large part due
to the WCRI, the industry is less insular than in the past and
ready to respond to the challenge.
With an economics PhD and law degree, Victor is a public
policy expert turned analysis entrepreneur for an industry with
Richard Victor
millions of legal and managerial decisions a month. He saw in every work injury a natural experiment in the
efficacy of the state-based benefit system.
In 1983, when he become WCRI’s founding president, the industry had little capacity or appetite to analyze
itself. Claims databases were primitive. In his application for the position at the WCRI, he said he wanted to
locate the organization in Cambridge in order to draw upon the area’s research talent.
Patiently, persistently, he nurtured among claims payers, employers and state agencies financial support for
quantitative analysis. It took until the 2000s for the Institute to produce regular multi-state reports through its
CompScope program. Some states are in their 16th edition of CompScope this year.
Before he had his own immense database, he often relied on the analysis of others. CNA released at the 1996
annual conference a devastating critique of the cost-effectiveness of telephonic case management, drawn from
a comparative analysis of six simultaneous trials. I recall the consternation on the face of one sales executive
in the audience.
Up through the mid 1990s, many insurers and pure claims operations had limited information technology,
capacity for data storage, analysis and reporting. But with 1990s came large database systems, a host of
analytic tools, and a large supply of PhDs with training in modeling.
The WCRI’s standard approach is observing variances in cost, utilization and other measures. In the 1990s, it
reported an almost 50% difference between the total cost per paid claim in the Austin/San Antonio area and the
El Paso area. In mid-2015, it reported how rates of back and knee surgery in 13 states differed, and why.
These kinds of variances, the WCRI has said often, cannot be plausibly explained by differences in state
workers’ compensation law. Economic and social factors and dynamics within the medical and communities
were the drivers. Delivering with this kind of documentation, the Institute inspired thousands to think more
imaginatively.
There is a causal connection from the Institute’s work and the emergence of an analytical community within
for-profit ventures. Jeffrey Austin White, director of innovation at Accident Fund Holdings, told me that
Page 36
Victor “is able to see beyond work comp and able to find talented researchers that help us understand future
opportunities in the context of economic change and state/federal legislation. We have adapted our own
business strategies in response to WCRI research on opioid utilization, physician dispensing, medical treatment
cost shifting, and work comp market dynamics.”
The Institute has not danced at every industry wedding. It did not, for instance, devote much time to predicting
injury outcomes, which others have studied in depth. I sense that Victor has tried to do as much as he could
with limited resources. One investment that may have required some coaching of his advisory board was
interviewing injured workers.
At its fall 2003 research conference, a groundbreaking survey of claimant satisfaction with medical care was
unveiled. The results were both reassuring and disturbing, a typical Victor cocktail. The WCRI reported how
3,000 lost-time injured workers in four states not only graded their medical care, but also reported how they
recovered physically and vocationally. A more recent worker survey led to a widely cited report that the
injured worker’s trust in the employer plays an important role in injury outcomes.
Well-done research on work injuries thrives when skilled researchers apply themselves within an ecology of
similar research. Much of this good research is hidden from the view of practitioners because it appears in
research journals. Much of it is visible, published by the WCRI, the California Workers’ Compensation
Institute, NCCI, and other centers. More and more of it come from for-profit ventures. Among the now many
and varied individuals and organizations part of this research ecology, Rick’s WCRI has been the most
energetic and effective.
Editor’s Note: The article has been republished in this edition of the Texas Workers’ Compensation Update
newsletter with the permission of WorkCompCentral.
The Insurance Council of Texas (ICT) congratulates Richard Victor on his retirement. Victor and Workers’
Compensation Research Institute (WCRI) has provided cutting edge research for the nation’s workers’
compensation systems since 1983. With the work of WCRI and Victor, state legislators, workers’ compensation
regulators and workers’ compensation system stakeholders around the nation would have gone without the
very valuable research findings of the WCRI. Victor has set the “Gold Standard” for workers’ compensation
research nationally. His drive and dedication to provide unbiased research reports is appreciated by ICT and
its many members.
There can be no doubt in any person’s mind who has been part of a workers’ compensation system around the
nation that the excellent, honest studies published by Richar Victor and his staff have not impacted workers’
compensation systems through the United States. The excellent studies have impacted many facets of workers’
compensation in the many states that have enacted workers’ compensation reform legislation. To that end,
those of us who have been the benefactors of WCRI’s research owe a lot to Richard Victor.
Special Offer for Texas Workers’ Comp System Stakeholders
WorkCompCentral now offers subscriptions to Texas workers’
compensation system stakeholders for as little as $11.53 a month.
WorkCompCentral brings you news about developments impacting
workers’ compensation at the speed of light. Their daily workers’
comp news service has no equal.
Be sure check out the various subscription options WorkCompCentral
offers today.
Page 37
For the last sixty years, Flahive, Ogden & Latson has
defended workers’ compensation claims before three state
agencies and state courts at every level. Our practice is
limited to workers’ compensation defense throughout the
State of Texas. Twenty-one lawyers in the firm have been
designated as board certified specialists in workers’
compensation law by the Texas Board of Legal
Specialization.
504 Lavaca Suite 1000 P.O. Box Drawer, 13367
Capitol Station Austin, Texas 78711
Tel 512.477.4405 | Fax 512.867.1700
Email fol@fol.com
____________________________________
Flahive Ogden & Latson Texas Workers’
Compensation Manual
Our insurance carrier clients include six of the largest
workers’ compensation insurance groups in Texas: The
American International Group, The Hartford Insurance
Companies, The Liberty Mutual Insurance Companies, The
Travelers Insurance Companies, Texas Mutual Insurance
Company and The Zurich Insurance Companies. We also
represent a large number of mid-size as well as small
carriers, many third party administrators, three self-insured
groups, thirty-four certified self insurers, and
approximately 2,500 cities, school districts, and other
governmental self-insureds.
Among the lawyers in the firm, one is a former Justice on
the Court of Appeals and one is a former Contested Case
Hearing Officer for the Texas Workers’ Compensation
Commission. Four of the firm’s lawyers were honors
graduates, three were editors of their respective law school
Law Reviews, four were selected by the Texas Court of
Appeals to prestigious judicial clerkships, and one served
as a clerk to a Justice on the Texas Supreme Court. Three
of the firm’s attorneys were members of their respective
law school national competition teams (mock trial, moot
court, or negotiation), and five are certified specialists in
fields other than workers’ compensation (personal injury
law, appellate law, and administrative law).
Visit FOL online at www.fol.com.
Page 38
2001 Bryan Street, Suite 4000
Dallas, Texas 75201
(214) 748. 7900
(214) 748. 4530 Fax
Since 1989, Downs • Stanford, P.C. has been engaged in the practice
of civil litigation throughout Texas, and, occasionally, in other
states. We excel in defending civil litigation cases, including
personal injury, workers' compensation, labor/employment law, and
prosecuting or defending business litigation. We also have
accomplished attorneys who concentrate in family law, probate and
estate planning, and civil appellate law.
The Firm is recognized with the prestigious AV rating by the
national legal directory Martindale-Hubbell and is promoted by
Best's Directory of Recommended Insurance Attorneys and
Adjusters. In addition the firm is recognized by the International
Society of Primerus law firms.
Providing insurers with quality legal
representation in workers’ compensation
claims and proceedings.
With Offices in Dallas and Austin, our docket
covers all venues throughout Texas.
Dallas
http://www.downsstanford.com/
* Unless indicated in the individual attorney biographies, not
certified by the Texas Board of Legal Specialization
Downs • Stanford maintains a strong presence before the Texas Workers' Compensation
Commission. Our attorneys are highly trained in the requirements of the Texas Labor
Code and the Rules of the Texas Workers' Compensation Commission. This expertise
covers both the "Old Law" and the "New Law". We are prepared to handle all aspects of
workers' compensation claims ranging from legal consultation on a specific claim issue,
medical dispute resolution, defending administrative violations, and the prosecution and
defense of judicial review matters and matters before the State Office of Administrative
Hearings.
We actively represent numerous insurance carriers, third-party administrators, employers
and certified self-insurers for all types of hearings before the Texas Workers' Compensation Commission, including Benefit Review Conferences, Contested Case Hearings and
appeals to the Appeals Panel of the Texas Workers' Compensation Commission. We
maintain an active trial docket of workers' compensation cases that have been appealed
beyond the Texas Workers' Compensation Commission into judicial review.
Austin
Downs • Stanford maintains a high success rate on workers' compensation trials. We have
also successfully defended our client’s interests before the Court of Appeals.
Downs • Stanford also provides a full service Board Representative Service to further
service all aspects of an insurer and self-insured company before the Texas Workers
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Our expertise covers all types of workers' compensation claims ranging from back strains
to complex multi-chemical sensitivity claims.
Page 39
DWC Releases 2015 PBO Results for Health Care Providers
On December 14, 2015, the Texas Department of Insurance’s Division of Workers’ Compensation (DWC)
announced that they had released the results of the 2015 health care provider performance based oversight
(PBO) assessment. For 2015, heath care providers were assessed on their performance in one of four
categories:
● timely filing the DWC Form-069, Report of Medical Evaluation;
● completeness of the DWC Form-073, Work Status Report;
● documentation supporting why the injured employee was prevented from returning to work as reported
on the DWC Form-073, Work Status Report; or
● usage of magnetic resonance imaging.
The DWC reported the following health care provider PBO assessment results:
Of the 83 health care providers reviewed for the timeliness of filing the DWC Form-069, Report of Medical
Evaluation: 61 had scores placing them in the high performer tier, 18 were in the average performer tier, and 4
had scores placing them in the poor performer tier.
Of the 124 health care providers reviewed for the completeness of the DWC Form-073, Work Status Report: 55
had scores placing them in the high performer tier, 38 were in the average performer tier, and 31 had scores
placing them in the poor performer tier.
Of the 124 health care providers reviewed for documentation supporting why the injured employee was
prevented from returning to work, as reported on the DWC Form-073, Work Status Report: 62 had scores
placing them in the high performer tier, 41 were in the average performer tier, and 21 had scores placing them
in the poor performer tier.
Of the 33 health care providers reviewed for the usage of magnetic resonance imaging: 21 had scores placing
them in the high performer tier, 8 were in the average performer tier, and 4 had scores placing them in the poor
performer tier.
DWC uses PBO, data monitoring, complaint handling, education letters, warning letters, audits, and
enforcement actions, when appropriate, to achieve its compliance objectives. DWC focuses its regulatory
oversight on poor performers, and offers incentives to high performers to promote improved performance and
greater overall compliance with the Workers' Compensation Act and DWC rules.
Additional information about the 2015 health care provider PBO assessment results and the tier placement of
the health care providers assessed can be found on the DWC’s website. An overview of the 2015 health care
provider PBO assessment methodology is available here.
Insurance carriers will be assessed as part of the biannual PBO assessment process in 2016.
Not an Associate Member of the Insurance Council of Texas?
Does your company or firm provide vendor or other services to property and casualty insurers? If so, your
company or firm may be eligible to join the Insurance Council of Texas . Contact Mark Hanna at
mhanna@insurancecouncil.org or Steve Nichols at snichols@insurancecouncil.org to become an associate
member of the Insurance Council of Texas.
Page 40
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!
Associate Member of the Insurance Council of Texas
Page 43
DWC Accepting Comments on Proposed Revision of Request for Travel Reimbursement Form
On December 14, 2015, the Texas Department
of Insurance’s Division of Workers’
Compensation (DWC) announced that the
agency was is accepting public comment on
revisions to DWC Form-048, Request for Travel
Reimbursement.
Revisions to DWC Form-048 incorporate
amendments to Rule 134.110(a), which was
effective March 30, 2014, that permit an injured
employee to request reimbursement from an
insurance carrier for certain travel expenses to
attend a designated doctor examination, required
medical examination, or post-designated doctor
examination. The revisions include separating
English and Spanish versions of DWC Form048 and updating the format and style for
consistency with other DWC forms, including adding plain language.
Revised DWC Form-048 adds a “Things to Know” section to provide additional information about travel
reimbursement. An informal draft of revised DWC Form-048 was previously posted on the DWC website on
May 18, 2015, with an informal comment period ending June 1, 2015.
In response to public comments, DWC added a box for the insurance carrier fax number and deleted the
"Reimbursement Requested" column.
An injured employee may request reimbursement from the insurance carrier for travel expenses incurred
while seeking medical treatment for a compensable injury not reasonably available within 30 miles from
where the injured employee lives or traveling to attend certain examinations if the distance traveled is greater
than 30 miles one way. An injured employee must use DWC Form-048 to request travel reimbursement. If the
insurance carrier denies or partially denies the request, the insurance carrier must send a plain language
explanation to the injured employee explaining the reasons for the denial or partial denial.
The revised draft form is currently available on the Texas Department of Insurance website. The public
comment period closes December 28, 2015, at 5 p.m. Central Standard Time.
Workplace Safety Resources
The Texas Department of Insurance’s Division of Workers' Compensation
provides safety and health resources to employers, employees, and other
entities that support the Texas workforce to eliminate the occurrence of
occupational injuries and hazardous exposures.
The National Safety Council provides safety and health resources to
employers in support of their mission to improve safety in the workplace.
Page 44
Stone Loughlin & Swanson’s Workers’ Compensation Case Law News
Joe Ballard v. Arch Insurance Company and Transforce, Inc., Houston Court of Appeals – 14th Dist. 2015
WL 6560531
The claimant suffered an eye injury in January 2011, which he alleged aggravated his pre-existing glaucoma.
The designated doctor assigned to examine his eye condition was a plastic surgeon, not an ophthalmologist,
and the claimant argued that as such he lacked the experience and qualifications necessary to evaluate an eye
condition. To support his argument, the claimant relied on Rule 127.130(b)(6), which states, “To examine
injuries and diagnoses relating to the eyes, including the eye and adnexal structures of the eye, a designated
doctor must be a licensed medical doctor, doctor of osteopathy, or doctor of optometry.” The Court of Appeals
held that Rule 127.130(b)(6) did not apply in this case because that provision pertains only to injuries sustained
on or after January 1, 2013. However, the Court clarified that even if Rule 127.130(b)(6) did apply, the
designated doctor, as a licensed medical doctor, would not be automatically precluded from evaluating an eye
injury merely because of his specialty as a plastic surgeon.
Barbara Pinkus v. Hartford Casualty Insurance Company, Dallas Court of Appeals – 2015 WL 6751059
The injured worker died as a result of injuries sustained in a motor vehicle accident while out of town on a
business trip. For the duration of his trip, he was under “continuous coverage”, which provides round the clock
coverage for employees sent out of town overnight on business by an employer. After work one night, the
decedent and his son agreed to meet for dinner, but the pair chose a restaurant twelve miles from the
employee’s Dallas hotel. The worker was injured in a motor vehicle accident occurred on the way to the
restaurant. The Hearing Officer and the Appeals Panel concurred that the decedent remained in the course and
scope of his employment under the continuous coverage doctrine and had not substantially deviated from the
business purpose of the trip. The trial court granted the carrier’s motion for summary judgment that the worker
was not in the course and scope of his employment at the time of injury, and the Court of Appeals
DWC Appeals Panel Decision 151718
A claimant followed her attorney’s (terrible) advice not to appear for a designated doctor appointment on June
3, 2014. The Hearing Officer determined that such counsel constituted good cause for her failure to attend. The
Appeals Panel reversed, stating that “bad advice received from one’s own attorney is not an excuse for the
failure to comply with Division requirements.” The designated doctor examination was reset to October 7,
2014, then rescheduled upon request of the designated doctor to November 4, 2014 with a different doctor. The
claimant attended that exam. The claimant then argued that the insurance carrier should begin payment of TIBs
as of the date of the first scheduled DD exam, October 7, 2014 since it was not her fault the exam was delayed
until November 4, 2014. However, the Appeals Panel clarified that Rule 127.25(a) requires actual attendance at
the designated doctor examination and does not allow for the suspension of TIBs based on a delay in the
subsequent appointment of a designated doctor examination. Therefore, the carrier was permitted to suspend
TIBs through November 4, 2014, the date the claimant actually submitted to her designated doctor exam.
Editor’s Note: The Case Law News was prepared by Stone Loughlin & Swanson, LLP. Stone Loughlin &
Swanson’s passion is administrative law. They have distinguished themselves as a "go to" law firm in the areas
of health and workers' compensation insurance regulation. Their innovative challenges to agency action have
saved their clients millions of dollars and changed the regulatory landscape for all system participants.
Martindale Hubbell, the nation's premier rating group for lawyers, has rated the firm "AV" which is their
highest distinction. In addition, they are the only law firm in Texas chosen to be a member of the National
Workers' Compensation Defense Network.
Page 45
Innovation. At Stone Loughlin & Swanson, LLP our passion is administrative law and we have distinguished ourselves as a "go
to" law firm in the areas of health and workers' compensation insurance regulation. Our innovative challenges to agency action
have saved our clients millions of dollars and changed the regulatory landscape for all system participants.
Expertise. We are eight attorneys, a registered nurse, and a dedicated support staff all focused on the same area of practice, day
in and day out. The firm is rated AV by Martindale Hubbell, the nation's leading rating group for lawyers. In addition, we are
the only law firm in Texas chosen to be a member of the National Workers' Compensation Defense Network.
Presence. We live and work in Austin, home of state regulatory agencies, the State Office of Administrative Hearings (SOAH),
and the Travis County courts (venue for substantial evidence judicial reviews). Our presence in the state capital allows us to
closely monitor agency actions and deliver cost-effective representation in administrative proceedings. In particular, our
proximity to the Texas Department of Insurance, Division of Workers' Compensation makes us perfectly positioned to assist
system participants in the development, certification, and regulation of workers' compensation health care networks and to assist
insurance carriers and self-insured employers with workers' compensation medical necessity and fee disputes.
Visit Us Online at: http://www.slsaustin.com/index.html
P: (512) 343-1300
F: (512) 343-1385
3508 Far West Blvd., Suite 200
Austin, Texas 78731
Member National Workers’ Compensation Defense Network – A Nationwide Network of Law Firms Practicing in Workers’ Compensation
Page 46
Associate Member of the Insurance Council of Texas
Page 47
Seventeen students at three Texas universities were
recently awarded a total of $34,000 in academic
scholarships from the Insurance Council of Texas
(ICT) Education Foundation.
The students attend St. Mary’s University in San
Antonio, Baylor University in Waco and the
University of North Texas in Denton.
Each student received a scholarship as well as an
invitation to attend ICT’s 2016 annual Mid-Year
Symposium in Austin where insurance industry leaders
gather to hear an update on the Texas marketplace.
Each year, 100 percent of the Mid-Year Symposium
sponsorships, company and individual donations go toward the ICT scholarships and school funding.
Many of the past scholarship recipients have gone on to work in the insurance industry and we hope the same
holds true for this year’s winners. Tony Gonzalez, president of the ICT Education Foundation, said there is a
good reason why insurance companies want to hire ICT scholarship recipients. “These students are awarded
for their hard work, academic achievements and extracurricular activity in the field of insurance and risk
management. They simply stand-out as high achievers and upon graduation, they will be a tremendous asset to
any company,” Gonzalez said.
ICT scholarship recipients at St. Mary’s University, in classes taught by Dr. David Sommer, are Eduardo
Cuevas, Jacob Reyes, Jean-Claude Prudhomme, Kendra Gray and Megan Steadman.
ICT scholarship recipients at the University of North Texas, in classes taught by Dr. Enya He and professor
Dale Sharpe-Jenkins, are Enrique Tudon, John Cameron, Julia Vivian, Savannah Peterson, Kaylyn Graham,
Nathan Johnson and Marquin Richardson.
ICT scholarship recipients at Baylor University, in classes taught by Dr. Jim Garven, are Melissa Sutton,
Katherine Kapplemann, Audrey Rodriguez, Briceon Wiley and Rachel Shriver.
The Insurance Council of Texas Education Foundation has awarded $812,000 to ten Texas universities and 390
insurance and risk management students since 2002.
For more information on the Education Foundation, go to https://insurancecouncil.org/educationFoundation.
.
Insurance Council of Texas Education Foundation
Individual contributions provide additional funding for student scholarships and academic achievement
awards. Minimum donations of $25 are accepted.
Please donate today and invest in the future of the Texas insurance industry.
Page 48
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DWC Accepting Comments on Proposed Revisions to DWC Form-042
On November 24, 2015, the Texas Department of
Insurance’s Division of Workers’ Compensation (DWC)
announced that the agency is accepting comment on
revisions to DWC Form-042, Beneficiary Claim for Death
Benefits.
The draft revised form can be found on the DWC’s website.
The revisions restructure the form to increase readability,
highlight additional required documentation, and revise the
title to Claim for Workers’ Compensation Death Benefits.
The DWC has posting the draft form for public comment simultaneously with proposed amendments to Rules
132.7 and §132.13.
Additional information about the proposed rules is available on the Texas Department of Insurance website.
The Texas incidence rate of nonfatal injuries and illnesses in private industry decreased to 2.4 cases per 100
equivalent full-time workers in 2014, down from 2.6 in 2013. The Texas rate is below the national rate of 3.2.
The total number of nonfatal injuries and illnesses also declined 2 percent from 198,800 to 194,642.
Incidence Rates per 100 Full-Time Employees for Total Nonfatal Injuries and Illnesses, Texas and U.S.,
Private Sector, 2004 – 2014
The 2014 nonfatal injury and illness data in this report are the latest available from the annual Survey of
Occupational Injuries and Illnesses (SOII) conducted by the Texas Department of Insurance, Division of
Workers’ Compensation (DWC) in cooperation with the U.S. Department of Labor, Bureau of Labor Statistics
(BLS). The occupational injury and illness rates are based on a statistical sample of private businesses in
Texas. Employers with questions about participating in this survey may call DWC at (866)-237-6405.
Page 51
Key Findings
The incidence rates for all major private industry sectors were lower than the national rates, except the
information industry, which was the same at 1.4.
The incidence rate for goods producing industries decreased from 2.6 in 2013 to 2.5 in 2014. Among these, the
rate for the agriculture, forestry, fishing, and hunting sector declined from 5.2 in 2013 to 4.6 in 2014. Likewise,
the incidence rate in the construction sector decreased 8 percent.
The service providing industries’ incidence rate also decreased from 2.6 in 2013 to 2.4 in 2014. Within this
group, rate decreases were seen in the professional and business services (27 percent) and retail trade (10
percent) sectors.
Rate increases occurred in the utilities (54 percent), information (27 percent), and educational services (23
percent) sectors.
Among all industry subsectors, couriers and messengers reported the highest incidence rate at 9.4, which was a
slight decrease from 9.7 in 2013.
The subsector with the largest decrease was leather and allied product manufacturing, which declined 70
percent from 5.3 in 2013 to 1.6 in 2014.
Incidence Rates of Total Recordable Nonfatal Occupational Injuries and Illnesses by Private Industry
Sector, 2010-2014, Texas
Source: Texas Department of Insurance, Division of Workers’ Compensation
Page 52
Incidence Rates of Total Recordable Nonfatal Occupational Injuries and Illnesses by Private Industry
Sector, 2010-2014, Texas Continued
Source: Texas Department of Insurance, Division of Workers’ Compensation
The complete Texas nonfatal injury and illness incidence rate and number data tables by industry can be found
on the TDI website at www.tdi.texas.gov/wc/safety/sis/nonfatalhomepag.html. For additional information,
contact the DWC at (512) 804-5020 or via email at injuryanalysis@tdi.texas.gov.
The DWC Workplace Safety program area provides various safety and health services to help reduce injuries
and illnesses in the workplace, including free safety and health consultations on Occupational Safety and
Health Administration (OSHA) regulations; regional and onsite safety training; free safety and health
publications; free safety training DVD loans; and the Safety Violations Hotline.
Notes: Incidence rates represent the number of injuries and illnesses per 100 full-time workers and were
calculated as (N/EH) x 200,000 where N= numbers of injuries and/or illnesses, EH= total hours worked by all
employees during the calendar year, 200,000= base for 100 equivalent full-time employees (working 40 hours
per week, 50 weeks per year).
The NAICS Code represents the industry code from the North American Industry Classification System, 2012
Edition. For more information regarding NAICS 2012 revisions, visit the BLS website.
Private industry data excludes farms with fewer than 11 employees. Totals include data for industries not
shown separately.
Data for mining (Sector 21 in the NAICS – United States, 2012) include establishments not governed by the
Mine Safety and Health Administration (MSHA) rules and reporting, such as those in oil and gas extraction
and related support activities. Data for mining operators in coal, metal, and nonmetal mining are provided to
BLS by MSHA, U. S. Department of Labor. Independent mining contractors are excluded from the coal, metal,
and nonmetal mining industries. These data do not reflect the changes OSHA made to its recordkeeping
requirements effective January 1, 2002; therefore estimates for these industries are not comparable to
estimates in other industries.
Data for employers in rail transportation are provided to BLS by the Federal Railroad Administration, U.S.
Department of Transportation.
Because of rounding, components may not add to totals. A dash indicates data do not meet publication
guidelines.
Source: Bureau of Labor Statistics, U.S. Department of Labor, Survey of Occupational Injuries and Illnesses,
in cooperation with participating state agencies.
Page 53
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DWC Reports Preliminary Results Regarding 2014 Fatal Occupational Injuries in Texas
On September 17, 2015 the Texas Department of
Insurance’s Division of Workers’ Compensation (DWC)
released the preliminary results of 2014 fata occupational
injury data.
The DWC reported that in 2014, there were 524 fatal
occupational injuries in Texas, a 3 percent increase from 508
in 2013, according to preliminary data from the U.S.
Department of Labor, Bureau of Labor Statistics (BLS),
Census of Fatal Occupational Injuries (CFOI). Nationally,
there were 4,679 fatal occupational injuries. The rate of fatal
occupational injuries in Texas was 4.4 per 100,000 full-time
employees in 2013, the latest year state fatality rates are
available. Fatal occupational injury rates for 2014 at the state
level will not be available until spring 2016, with the release of the final CFOI data.
Incidence rates for non-fatal injuries and illnesses by industry for 2014 will be released in October 2015. In
2013, the Texas private sector incidence rate for nonfatal occupational injuries and illnesses was 2.6 per 100
full-time employees, while the national rate was 3.3 per 100 full-time employees. The Texas non-fatal
incidence rate has been below the national rate since data collection began in 1990.
The DWC compiles detailed information on all occupational fatalities occurring in Texas for the CFOI, a
program jointly administered with the BLS. DWC annually releases total fatal injury counts and descriptive
data to provide information to assist employers, safety professionals, and policymakers identify occupational
safety and health issues in the state.
Key Findings
The DWC reporting the following key findings:
In Texas, transportation incidents continued as the leading cause of fatal occupational injuries, accounting for
45percent. While other types of transportation incident categories declined, roadway incidents involving a
motorizedland vehicle increased from 168 to 185 incidents.
Transportation incidents involving the support activities for mining industry increased from 25 incidents in
2013to 35. In the heavy and civil engineering construction industry, these incidents decreased from 21 to 8
incidents.The truck transportation industry experienced 50 transportation incidents, down from 57 in 2013.
In the construction industry, fatal occupational injuries declined 9 percent from 116 incidents in 2013 to 105
in2014.
Fatal injuries resulting from falls declined 9 percent (from 74 to 67). Although the number of incidents
involvingcontact with objects did not change from 2013 (76 incidents), they surpassed falls as the second
leading cause offatal occupational injuries. Of these, 75 percent involved being struck by an object or
equipment, and 17 percentinvolved employees being caught in or compressed by equipment.
Continued on next page…
Page 56
The industry subsectors in Texas experiencing the highest number of fatal occupational injuries were
specialtytrade contractors (68 incidents), truck transportation (66 incidents), support activities for mining (64
incidents),administrative and support services (31 incidents), and heavy and civil engineering construction (26
incidents).
Fatal injuries in local government declined 44 percent from 50 to 28 incidents. Most notably, protective
serviceoccupations such as fire fighters and police officers experienced 62 percent fewer fatalities.
In Texas in 2014, the major occupation group with the highest number of fatalities was transportation and
material moving occupations, with 172 incidents. This was a 6 percent increase from the 163 incidents in 2013.
Of these, 65 percent were heavy and tractor-trailer truck drivers, with 112 incidents. This was a 2 percent
increase in fatal injuries from the 110 incidents in 2013.
The construction and extraction occupations had the second highest number of fatalities with 124 incidents. Of
these, 57 percent) were construction trades workers (71 incidents), a decrease of 12 percent (81 incidents).
More than a quarter (27 percent) involved extraction workers (34 incidents), an increase of 21 percent from
2013 (28 incidents).
Causes of Fatalities
Transportation Incidents
Transportation incidents continued as the leading cause of fatal occupational injuries in Texas, with 237
incidents (45 percent of the total fatalities). This was an increase of 4 percent from 2013 (228 incidents). Of the
transportation incidents, 185 were roadway incidents involving a motorized land vehicle, 21 were pedestrian
vehicular accidents, 13 were non-roadway incidents involving a motorized land vehicle, 7 were water vehicle
incidents, and both aircraft incidents and rail vehicle incidents had 5 incidents each (Table 1).
Of the roadway incidents, 60 percent were on a state or U.S. highway (111 incidents). A freight hauling and
utility truck such as a tractor trailer truck or delivery truck or van was involved in 54 percent of the roadway
incidents (99 incidents) and 58 percent involved collisions with another vehicle (107 incidents). One hundred
of the employees involved were in the transportation and material moving occupations and 32 were in the
construction and extraction occupations.
The service providing industries in the private sector recorded more than half of the roadway incidents (96
incidents). Of these, almost one quarter of the incidents were in the truck transportation industry (45 incidents),
a decrease of 12 percent from 2013 (51 incidents). The goods producing industries in the private sector
recorded 39 percent of the roadway incidents (72 incidents). Of these, 19 percent were in the support activities
for mining industry (35 incidents), an increase of 59 percent from 2013 (22 incidents). Employees between the
ages of 35 to 54 were involved in 43 percent of the roadway incidents (80 incidents). More than half of the
employees were White, non-Hispanic (95 incidents), a decrease of 2 percent from 2013; 37 percent were
Hispanic or Latino (69 incidents), an increase of 38 percent from 2013. Eighty-four percent of the employees
involved in roadway incidents (155 incidents) were born in the United States, 11 percent (21 incidents) were
born in Mexico. The months with the highest number of roadway incidents were October (32 incidents) and
September (23 incidents).
Of the 21 pedestrian vehicular incidents, 14 occurred on a street or highway and six occurred at an industrial
place or premise. Seventeen pedestrians were struck by a highway vehicle such as an automobile, semi truck,
dump truck, or pickup truck; three pedestrians were struck by an off-road and industrial vehicle such as a
forklift or powered pallet jack. Almost two-thirds of the employees involved in pedestrian vehicular incidents
were in the transportation and material moving occupations (13 incidents).
Page 57
Contact with Objects and Equipment
The second leading cause of fatal occupational injuries was contact with objects and equipment with 76
incidents. Of these, three-quarters involved being struck by an object or equipment (57 incidents). Thirteen
employees were caught in or compressed by equipment or objects, and six were struck, caught, or crushed in a
collapsing structure, equipment, or material.
Twenty-eight percent of the contact with objects and equipment incidents involved a vehicle (21), almost one
quarter involved machinery such as oil drilling rigs and machinery, cranes, etc. (18), and 20 percent involved
parts and building materials (15 incidents). Nearly one-third of the contact with objects and equipment
incidents involved employees in the construction and extraction occupations (24 incidents), 22 percent
involved employees in the transportation and material moving occupations (17 incidents), and 17 percent
involved employees in the installation, maintenance, and repair occupations (13 incidents).
Twenty-two percent of the contact with objects and equipment incidents occurred in the mining, quarrying, and
oil and gas extraction industry (17 incidents), an increase of 89 percent from 2013 (nine incidents); 21 percent
occurred in the construction industry (16 incidents) a decrease of 27 percent from 2013 (22 incidents); and 12
percent occurred in the transportation and warehousing industry (nine incidents).
Falls
The third leading cause of fatal occupational injuries was falls, slips, or trips with 67 incidents, a 9 percent
decrease from 2013. Of those incidents, 82 percent involved falls to a lower level (55 incidents). Twenty-two
percent of the falls to a lower level were from a roof (12 incidents), 20 percent were from a ladder (11
incidents), and 15 percent were from a parked motorized freight hauling and utility truck (eight
incidents).Thirty-one percent of the falls to a lower level occurred at a residential or construction site (17
incidents); and 36 percent of the employees were in the construction trades occupations (20 incidents).
The final 2014 fatal injury numbers and rate will be released in spring 2016. The CFOI data tables can be
found on the TDI website at www.tdi.texas.gov/wc/safety/sis/fathomepage.html. For more information about
fatal occupational injuries, contact DWC at (512) 804-5020 or cfoi@tdi.texas.gov.
DWC Considering Adopting a Compliant Form for Workers’ Compensation Insurance Related Complaints
On December 11, 2015, the Texas Department of Insurance’s Division of Workers’ Compensation (DWC)
announced that the agency was acaccepting public comment on new DWC Form-XXX, Workers'
Compensation Complaint Form. A form number will be assigned to the complaint form if the DWC proceeds
with adopting such a form.
Section 402.023(c) of the Texas Labor Code states, in part, that the division shall develop and post on the
website a simple standardized form for filing complaints. The DWC noted in its announcement that the new
DWC Form-XXX provides a simple standardized form for the filing of workers' compensation complaints,
and may be submitted via email, fax, or mail. The DWC also noted that a person may also submit a complaint
through TDI-DWC's website, through email, fax, written correspondence, or in person, without using the
form.
The public comment period closes Monday, January 4th, 2016, at 5 p.m. Central time.
Page 58
Workers’ Compensation Insurance Fraud Is A Problem!
What is Insurance Fraud?
Insurance fraud is an intentional deception committed by policyholders, claimants, health care providers, agents and company
employees. It may occur during the process of buying, using, selling
or underwriting insurance and is usually motivated by greed.
Insurance Fraud is a crime in Texas!
Workers’ Compensation insurance fraud is a problem.
The National Insurance Crime Bureau (NICB) has reported that
studies indicate up to 10 percent--perhaps more--of all property/
casualty insurance claims are fraudulent. The NICB has also
estimated that workers' comp fraud costs the insurance industry as
much as $5 billion annually.
Workers’ compensation fraud includes the padding of bills by health
care providers, injured employees claiming injuries that do not
occur, employers falsely classifying employees in different
occupations to obtain lower premiums, and injured employees
receiving income replacement benefits while working.
“Disabled” Injured Worker Playing Golf
We Need Your Help!
The Texas Committee on Insurance Fraud needs your help in
fighting workers’ compensation fraud.
You can help us fight workers’ compensation insurance fraud by
reporting it to the Texas Department of Insurance at 1-888-3728818.
Online Reporting of Fraud Available
Online reporting of insurance fraud is available at:
http://www.tdi.state.tx.us/fraud/frsiufrrpt.html.
Take a bite out of crime by reporting workers’ compensation
insurance fraud.
Get Involved with the Texas Committee on
Insurance Fraud
Contact Mark Hanna at (512) 444-9611 or at the following e-mail
address mhanna@insurancecouncil.org to become involved in the
Texas Committee on Insurance Fraud.
Help Us Fight Workers’ Compensation Insurance Fraud
Page 59
An Associate Member of the Insurance Council
Page 60
3200 Highland Avenue
Downers Grove, IL 60515
(630) 737-7900
wcservices_information@cvty.com
Coventry WC Network Services, a business segment of Coventry Health Care Workers' Comp Services, Inc. ("Coventry
Workers' Comp Services"), is the comprehensive outsourcing solution for containing health care and disability costs.
Serving the occupational health care market, Coventry Workers’ Comp Services provides employers, insurers and claims
payors with a variety of integrated health care services. These services include in-network and out-of-network medical
claims review and re-pricing, access to specialized Preferred Provider Organizations ("PPOs"), early intervention and case
management-driven Return-To-Work ("RTW") services and other cost management and related services.
Recently formed from the combination of First Health and Concentra’s Workers’ Compensation Cost Management
businesses, Coventry Workers’ Comp Services delivers increased medical, indemnity and administrative (“total cost”)
savings by offering our customers a fully integrated suite of services.
Coventry WC Networks have focused our workers’ compensation expertise, technology and work process re-engineering
resources to deliver the following value to our customers:
• Increased cost savings (medical and total costs)
• Improved communications and quality of decision-making
• Service innovation, consistency and reliability
• Increased information accuracy and usefulness; and
• Increased frequency of superior claims outcomes.
With more than three decades of experience and as one of the industry leaders in our field, Coventry WC Network Services
provides services that successful reduce the high cost of workers’ compensation medical and total costs while delivering
improved claims outcomes for injured workers, employers, third-party administrators and insurers.
Coventry WC Network Services reviews, re-prices, and reduces medical bills received by claims payors (third-partyadministrators and insurers) and also achieves customer savings through fee negotiation and access to PPO networks.
Document management solutions and Adjuster Desktop informational interfaces contribute proven capabilities that
facilitate adjuster effectiveness and improve the timeliness and flow of meaningful information to support both better
decision-making and lower operating costs.
Visit us online at http://www.coventrywcnetworks.com/.
Page 61
Page 62
On June 9, 2015, Commissioner of Workers’ Compensation Ryan
Brannan announced final disciplinary actions taken by the Division
of Workers’ Compensation (DWC).
The final actions include administrative penalties ordered against
insurance carriers and health care providers in the workers’ compensation system. Beginning January 1, 2015, through November 30,
2015, Commissioner of Workers’ Compensation Rayan Brannan has
ordered administrative penalties totaling for $1,037,500 system
participants. . The penalties include $1,037,500 in fines ordered for
insurance carriers, $288,200 in fines ordered for health care
providers, and $76,000 in fines ordered for other entities.
Violations cited in orders naming insurers included failure to timely
pay a medical bill, failure to timely pay income benefits to an injured
employee, and retrospectively reviewing the medical necessity of a
preauthorized medical service or treatment. Violations cited in orders
naming health care providers included failure to timely file and/or
accurately complete DWC forms, reports or records.
The enforcement actions taken against system participants included a fine of:
● $4,000 for an insurer for failing to timely pay income benefits to injured employees;
● $11,500 for an insurer for failing to process claims in reasonable and prudent manner and failing to
timely contact and offer a survey to its policyholder after learning of a work-related fatality;
● $25,000 for a political sub-division risk pool for failing to timely pay benefits to injured employee;
and
● $3,000 for a health care provider group for billing an injured employee for wokers’ compensation
medical services that was provided to the injured employee.
Summaries of disciplinary actions are available on the Texas Department of Insurance (TDI) website at:
https://wwwapps.tdi.state.tx.us/inter/asproot/commish/da/dwcclips2015.asp.
Specific order summaries also can be viewed by searching by the subject of the order here:
http://www.tdi.texas.gov/commish/actions.html.
Copies of Commissioner of Workers' Compensation orders also may be obtained by calling Maria Jimenez,
DWC Enforcement, at (512) 804-4703 or via e-mail to Maria.Jimenez@tdi.texas.gov.
On average, 2-3 people are treated in emergency departments
every hour during the holiday season for decorating-related
injuries. Don't forget to follow these holiday safety tips to
decorate safely.
Page 63
The Property Casualty Insurers Association of America (PCI) provides a
responsible and effective voice on public policy questions affecting
insurance products and services in an effort to foster a competitive
insurance marketplace for the benefit of insurers and consumers. The
proverbial adage “strength in numbers” rings true at our association, for
no insurance company can solely create the type of influence, wealth of
information and networking opportunities that PCI provides. Our
greatest value to members is the ability to save companies time and
money by creating individual and collective victories through a healthier
legislative and regulatory environment. Members benefit from the
advocacy, knowledge, networking and value that PCI offers.
Advocacy: The unmatched skills of PCI staff and local lobbyists, a
group that includes former state legislators and commissioners,
enables the association to inform and influence state and federal
public policy makers. Retained lobbyists are used in each state to
advocate PCI positions on issues. Expert staff exists at PCI
headquarters in Des Plaines, our federal government affairs office in
Washington, D.C., and regional offices in Albany, Atlanta, Austin,
Boston, Denver, Harrisburg, Tallahassee, Trenton, Seattle and
Sacramento to better manage industry activity.
Knowledge: The information members receive is specifically targeted
to their interests. Our more than 80 publications — including bulletins,
committee communications, reference and research documents and
statistical analysis — enlighten members with understanding that is
necessary to stay on top of new industry activities.
In particular, the Legislative Database tracks thousands of bills and
regulations each year, reporting on their introduction, enactment, and
court challenges. This service analyzes and interprets effects of bills and
regulations on insurers — saving members the cost of noncompliance.
Besides the written word, the sharing of information takes place through
seminars, where industry experts editorialize and clarify issues, and
committee meetings that facilitate information sharing among members.
Networking: Gleaning competitive tips from peer-to-peer contact leads
to peak performance. PCI provides a multitude of opportunities to meet
with colleagues and establish new business associates each year through
its 8 seminars and numerous committee meetings. PCI has at least one
member headquartered in each of the 50 states, bringing more contacts,
knowledge and expertise to the association — and creating partnerships
across the nation.
Enhance your business, your bottom line, your industry environment. E-mail gabrielle.saylor@pciaa.net or call her at
847-553-3634.
Page 64
INSURANCE COUNCIL OF TEXAS
Become An Associate Member Today
The Insurance Council of Texas (ICT) is a multi-purpose, non-profit trade
association of property and casualty insurers writing business in Texas. ICT's
purpose is to provide a mechanism through which our members and associate
members can collectively represent their interests in the regulatory process and
stay abreast of those events that affect the business of insurance in Texas.
Our experienced and knowledgeable staff provides a variety of services and
products that give our member companies the information and resources they
need to be successful in the Texas insurance marketplace.
Our Accomplishments
● ICT is an opinion leader in the Texas
workers’ compensation system.
● ICT has commented on every new rule
proposed by the state’s workers’
compensation regulatory agency and
shaped the rules that have been adopted.
● ICT provides our membership with
timely analysis of new laws and rules
not available from any other source.
More information about our workers’
compensation program is available on ICT’s
website.
ICT does not lobby, but follows the legislative process and reports to the
membership on important legislative initiatives and changes in insurance law.
We are regular participants in regulatory matters and employ an active
committee system to guide our involvement.
ICT’s Workers’ Compensation Services program provides our members and
associate members with representation before the Texas Department of
Insurance (TDI) and the TDI Division of Workers’ Compensation on
regulatory matters, timely reports on developments impacting the Texas
workers’ compensation system and information not available from any other
source.
AssociateMembershipBenefits
■ Your company/firm would join the collective voice of ICT's 500
plus member insurance companies and a growing number of
associate members;
■ Access to ICT's "members only" website;
■ Access for an unlimited number of company/firm staff members
to our workers' compensation newsletter, association newsletter,
workers' compensation bulletins and other insurance lines
bulletins, and our members-only confidential legislative report;
■ ICT’s Workers’ Compensation Committee provides our members
with a forum to discuss workers’ compensation policy issues;
■ Free access to ICT's on-line, electronic workers' compensation
manuals, e.g. Texas Workers' Compensation Law and Rules
manual and Appeals Panel Digest; and
Contact Mark Hanna, ICT’s
Manager of Public Affairs, at (512)
444-9611 to obtain additional
information about joining ICT.
■ New associate members and associate members who renew their
membership are entitled to have a full-page, multi-color advertisement in each edition of the Texas Workers' Compensation
Update newsletter.
Visit Us Online at http://www.insurancecouncil.org/.
Page 65
Page 66
Page 67
The DWC Recognizes Employers with Lone Star SafetyAward
On September 28, 2015, the Texas Department of Insurance’s Division of Workers’ Compensation (DWC)
announced that Commissioner of Workers’ Compensation, Ryan Brannan, had presented two companies
(Southern Plastics, Inc. and Rusk County Electric Cooperative) with the DWC Lone Star Safety Award
(formerly the Peer Review Safety Award), a state designation for Texas businesses with excellent safety
programs that serve as models for other employers. The employers were recognized for their exemplary
workplace safety programs and low rates of work-related injuries and illnesses at the companies’ facilities.
“The injury rate at Texas workplaces has fallen 33 percent since 2005 thanks in large part to the outstanding
efforts of employers like these,” Brannan said. “When businesses promote a culture of safety by providing
excellent training and empowering workers to report any hazards, everybody wins. Fewer injuries mean a more
productive workplace and lower insurance premiums.”
Regal Manufacturing in Tyler, a metal fabrication company, is also a recent recipient of the Lone Star
Safety Award. All three companies were previously awarded a Safety and Health Achievement Recognition
Program (SHARP) designation by the state and the federal OSHA. The SHARP award recognizes small,
private sector Texas employers for exemplary safety and health programs.
DWC provides a variety of services to help Texas employers provide safe and healthy workplaces,
including health and safety materials and customized, onsite safety training. Additional information on these
services, and for eligibility criteria for the SHARP and Lone Star Safety awards can be found on the DWC’s
website.
San Angelo Company Recognized for Exemplary Safety Program
On November 9, 2015, the Texas Department of Insurance’s Division of Workers’ Compensation (DWC)
announced that Commissioner of Workers’ Compensation Ryan Brannan presented Coverlay Manufacturing,
Inc., with the Lone Star Safety Program Award here today. The award recognizes Texas employers with low
numbers of work-related injuries and illnesses as well as excellent safety programs that can serve as models for
other employers.
Coverlay Manufacturing has 32 employees in San Angelo and manufactures laminated ABS plastic which is
used in automotive parts.
“Coverlay Manufacturing has created an outstanding safety culture that fosters high quality and active
participation in their safety programs,” Brannan said.
Coverlay Manufacturing is a participant in the Division of Workers’ Compensation (DWC) Occupational
Safety and Health Consultation (OSHCON) Program. It was awarded a Safety and Health Achievement
Recognition Program (SHARP) designation by DWC and the federal Occupational Safety and Health
Administration (OSHA). The SHARP Award recognizes small, private sector Texas employers for exemplary
safety and health programs after participation in the OSHCON program. SHARP recipients receive an
exemption from programmed OSHA inspections.
Texas Occupational Injury, Illness and Fatality Data
The Texas Department of Insurance’s Division of Workers’ Cmpensation’s workplace safety web page
includes a link to Texas occupational injury, illness and fatality data. Check it out today.
Page 68
Participating Universities
About the Education Foundation
The Insurance Council of Texas Education Foundation was created
in 2007 for charitable and educational purposes. It uses its resources
for academic scholarships to support students enrolled in insurance
and risk management courses at Texas colleges and universities.
The Education Foundation also offers academic achievement
awards to the business schools to enhance their insurance and risk
management programs. This funding is evaluated each year to
determine how the funds were utilized.
The Education Foundation, acting through its board of trustees or
any authorized person or committee, has the sole discretion to
determine to whom such grants or scholarships are to be made and
the terms and conditions for their continuation.
The Education Foundation currently provides scholarships and
academic funding to ten Texas universities. Scholarships are
awarded to the school's junior and senior insurance and risk
management students on an annual basis. Each school also receives
academic achievement awards that provide funds for books, study
materials and travel expenses.
All of the funds from company sponsorships of the Insurance
Council of Texas’ annual Mid Year Property and Casualty
Insurance Symposium go toward scholarships and academic
achievement awards. The Education Foundation carefully considers
the distribution of these funds to maximize their assistance to
students and each business school.
You Can Contribute to the Education Foundation
Insurance Council of Texas
Education Foundation
P.O. Box 15
Austin, Texas 78767-0015
(512) 444-9611
Visit Us on the Web Here
Individual contributions also provide additional funding for student
scholarships and academic achievement awards. Minimum
donations of $25 are accepted. Individual contributions can be made
online or mailed using the Education Foundation's Contribution
form.
Please make some time to view the Student Recruitment Video
produced by the Insurance Council of Texas.
Insurance companies and Insurance-related organizations who would
like to receive information on ICT's most recent scholarship
recipients, can contact Mark Hanna at (512) 444-9611 or via e-mail.
Contribute today and invest in the future of the Texas insurance
industry.
Page 69
Are the Income Benefits Paid by Your Company Accurate?
On March 4, 2015, the DWC announced final disciplinary actions that
had been taken against system participants. During the period January
1, 2015, through February 28, 2015, the Commissioner of Workers’
Compensation ordered administrative penalties totaling $424,900.
The penalties include $386,700 in fines ordered for insurance carriers,
$18,200 in fines ordered for health care providers, and $20,000 in fines
ordered for other entities. Many of the fines against carriers were for
failure to timely and/or accurately pay income benefits.
See ICT’s Workers’ Compensation Bulletin 2015-07, dated March 16,
2015, for a detailed overview of the DWC’s recent enforcement activity
associated with the payment of income benefits.
Audits of Death and Lifetime Income Benefits Payments Revealed
Underpayments
Texas Labor Code
Chapter 408 – Workers’ Compensation Benefits
DWC Income Benefit Rules
Chapter 128 Rules – Calculation
of Average Weekly Wage
Chapter 129 Rules – Temporary
Income Benefits
Chapter 130 Rules – Impairment
and Supplemental Income
Benefits
On February 10, 2015, the DWC announced that the agency had
conducted performance audits of several insurance carriers on the
accuracy of payments of Lifetime Income Benefits (LIBs) and Death
Benefits (DBs). Through these audits, the DWC discovered
underpayments on 64 claims totaling over $511,000.
Common compliance errors discovered in the performance audits that
contributed to the underpayment of benefits included:
•
•
•
•
Failure to pay 75% of average weekly wage;
Failure to obtain a complete wage statement;
Failure to properly calculate average weekly wage; and
Failure to include non-pecuniary wages in average weekly
wage.
The Commissioner of Workers’ Compensation, Ryan Brannan
announced that the Division of Workers’ Compensation will be
conducting benefits accuracy audits in the future.
Chapter 131 Rules – Lifetime
Income Benefits
A seminar presentation that focused on the accurate and timely benefits
was presented by Brandi Prejean, an attorney with Thornton, Biechlin,
Segrato, Reynolds & Guerra L.C., at ICT’s April 2015 workers’ compensation seminar. Ms. Prejean’s presentation can be found here.
Chapter 132 Rules – Death and
Burial Benefits
Information regarding the types of benefits in the Texas workers’ compensation system can be found on the DWC’s website.
Several ICT associate member insurance defense law firms are willing to provide death and income
benefits accuracy training to your company’s workers’ compensation insurance adjusters.
Page 70
By James M. Loughlin, Partner, Stone Loughlin & Swanson, LLP
There is no limit on how much an air ambulance provider (or any
other health care provider, for that matter) can charge for its
services or how often it can raise its charges. For example, one
of the largest air ambulance providers in Texas, PHI Air
Medical, increased its base rate from $11,492.00 in 2010 to
$26,177.00 in 2014, a 128% increase. At the same time, it
increased its mileage rate from $150.00 per mile to $290.00 per
mile, an increase of 93%.
However, the lack of any restrictions on a provider’s billed
charges is only a problem when it is held that the provider is
entitled to reimbursement of its billed charges. Since January
2014, the Texas Department of Insurance’s Division of Workers’ Compensation (Division) has been doing
just that, issuing medical fee dispute decisions holding that its medical fee guideline does not cover air
ambulance services and ordering payment of the air ambulance providers’ billed charges on the grounds that
they are “fair and reasonable.”
Many of the Division’s decisions have been appealed by the carrier to the State Office of Administrative
Hearings (SOAH) where they have been assigned to Administrative Law Judge Craig Bennett. Judge Bennett
consolidated a group of early cases between PHI Air Medical and eight insurance carriers. These lead cases
will determine the legal issues for the remainder of the air ambulance cases pending at SOAH.
Judge Bennett issued a preliminary order on August 5, 2015 announcing his decision that “the proper
reimbursement rate for the air ambulance services in issue is 149% of Medicare.” In doing so, Judge Bennett
rejected the Division’s position that PHI’s billed charges are fair and reasonable, he concluded that
reimbursement should be Medicare-based, i.e., a percentage of the Medicare rate, and he picked a percentage
which is not much higher in dollar terms than 125% of Medicare.
The carriers paid PHI at 125% of the Medicare rate based on their understanding that the Division's Medical
Fee Guideline applies to ambulance services. In finding that the proper reimbursement rate for the air
ambulance services in issue is 149% of Medicare, Judge Bennett also concluded that the Division’s Medical
Fee Guideline does not apply to ambulance services.
Judge Bennett issued his Decision and Order on September 8, 2015 explaining in detail the reasons for his
decision. He found that payment of PHI at its billed charges does not satisfy the statutory reimbursement
criteria and would result in workers’ compensation patients unfairly subsidizing the vast majority of PHI’s
other patients. However, Judge Bennett also found that payment of PHI at 125% of the Medicare rate does
not satisfy the statutory reimbursement criteria and would result in workers’ compensation patients having to
be subsidized by other higher-paying patients.
Judge Bennett found that “a reimbursement rate of 149% of Medicare results in PHI being reimbursed an
amount that is as close to ‘subsidization-neutral’ as possible, resulting in a reimbursement reflecting the actual
average costs and reasonable profit of PHI in providing services to workers’ compensation claimants.” The
149% payment adjustment factor was determined by calculating the average payment that PHI received per
flight for all payers during the disputed time period and then indexing that amount to the Medicare rate.
Page 71
The difference between PHI’s billed charges and 149% of Medicare is significant. PHI sought additional
reimbursement of $556,792.59 but was awarded only $45,868.70, which is 8.2% of the total amount sought.
This demonstrates how far PHI’s billed charges are from the amount determined by Judge Bennett to be fair
and reasonable.
PHI's counsel has stated that PHI intends to appeal Judge Bennett's decision to district court. Judge Bennett
previously rejected PHI's argument that the federal Airline Deregulation Act preempts Texas' workers'
compensation laws governing reimbursement to health care providers from being applied to it. This issue has
national implications for PHI. PHI is also expected to appeal Judge Bennett’s conclusion that PHI’s billed
charges are not “fair and reasonable” reimbursement.
Overall, Judge Bennett’s decision is a win for the carriers. However, the carriers don't agree with his decision
that 125% of Medicare is not fair and reasonable. The carriers will likely cross-appeal Judge Bennett's
decision on the grounds that the fee guideline applies and 125% is more than fair and reasonable. One issue
on appeal may be whether the statutory standards for fair and reasonable reimbursement, if properly
interpreted, guarantee health care providers a profit.
Judge Bennett's decision will hopefully encourage the Division to move quickly to adopt a fee guideline for
ambulance services. The Division first decided that its Medical Fee Guideline does not apply to ambulance
services, ground or air, on January 31, 2014, over a year and a half ago. Air ambulance fee disputes will
continue to pile up at the Division until it adopts a fee guideline. Judge Bennett's decision will hopefully also
cause the Division to reconsider its approach to these disputes of ordering payment of the air ambulance
providers’ billed charges.
Editor’s Note: This article was written by James Loughlin, a
partner in the Austin law firm of Stone Loughlin & Swanson, LLP.
Mr. Loughlin represents various carriers in the lead docket for the
air ambulance cases at SOAH.
Mr. Loughlin represents workers' compensation insurance carriers
and other system participants in all areas of workers' compensation
law. He is board certified in workers' compensation law by the
Texas Board of Legal specialization. Mr. Loughlin obtained his
undergraduate degree from Texas A&M University and his law
degree from Baylor University.
Stone Loughlin & Swanson’s passion is administrative law. They
have distinguished themselves as a "go to" law firm in the areas of
health and workers' compensation insurance regulation. Their
James M. Loughlin
innovative challenges to agency action have saved their clients
millions of dollars and changed the regulatory landscape for all system participants.
Martindale Hubbell, the nation's premier rating group for lawyers, has rated the firm "AV" which is their
highest distinction. In addition, they are the only law firm in Texas chosen to be a member of the National
Workers' Compensation Defense Network.
Stone Loughlin & Swanson, LLP retains the copyright over this article.
As of the date of the publication of this article and newsletter, the Division continues to issue decisions that
“rubber stamps” the PHI Air’s billed amount. The Division’s decisions do not consider the ALJ’s decision
rationale set out in the SOAH decision.
Page 72
Insurance Commissioner Repeals Texas Retrospective Rating Plan Manual
On December 7, 1015, Texas Insurance Commissioner David
Mattax adopted a rule to repeal the rules, factors, values,
endorsements, and forms in the Texas Retrospective Rating Plan
Manual (Texas Retro Plan) for new and renewal workers'
compensation policies written on a retrospectively rated basis
with effective dates on and after 12:01 a.m., January 1, 2017.
Insurers writing policies on a retrospect-ively rated basis with
effective dates before January 1, 2017, under the Texas Retro
Plan must use the Texas Retro Plan to make all retrospective
adjustments for those policies.
Insurance Commissioner David Mattax
The Texas Retro Plan was determined to no longer be necessary
since the National Council on Compensation Insurance
Retrospective Rating Plan Manual (NCCI Retro Plan) has been
available for use in Texas as an alternative to the Texas Retro
Plan since June 1, 2011. With the repeal of the Texas Retro Plan,
insurers continue to have the options of making a reference filing
with TDI to use the NCCI Retro Plan, or filing their own
retrospective rating plans for use in Texas.
The rule repeals the obsolete Texas Retro Plan, leaving in place the alternatives that currently exist for insurers
using retrospective rating plans. Those alternatives are: 1) using the NCCI Retro Plan after making a reference
filing with TDI to use that plan, or 2) filing their own insurer-specific plans under Insurance Code Sections
2052.002 and 2053.003 for use in Texas.
Using retrospective rating for workers' compensation policies is optional, and there is no requirement for a uniform
retrospective rating plan in Texas. Insurers have always been permitted to file their own retrospective rating plans
or to use the Texas Retro Plan. On June 1, 2011, the NCCI Retro Plan became available for use in Texas as an
alternative to the Texas Retro Plan. NCCI is a licensed advisory organization in Texas, the largest provider of
workers' compensation and employee injury data and workers' compensation statistics in the nation, and the
statistical agent and administrator for certain workers' compensation functions in Texas.
Insurers writing policies on a retrospectively rated basis with effective dates before January 1, 2017, under the
Texas Retro Plan must use the Texas Retro Plan to make all retrospective adjustments for those policies.
For new and renewal workers' compensation policies written on a retrospectively rated basis with effective
dates on and after 12:01 a.m., January 1, 2017, insurers must either make a reference filing with TDI to use
the National Council on Compensation Insurance Retrospective Rating Plan Manual (NCCI Retro Plan), or
file their own retrospective rating plans with TDI.
Have a Safe Holiday Season and a Happy New Year
The holidays are a great opportunity to enjoy time with family and friends, celebrate life, to be grateful, and reflect on what’s important. They are also a time to
appreciate the gift of health. Here are some holiday tips to support your efforts for
health and safety this season.
Please take a moment to learn about Christmas Traditions in Texas here.
Page 73
FROM THE STAFF OF THE INSURANCE COUNCIL OF TEXAS
2016
Civilizations around the world have been celebrating the
start of each new year for at least four millennia. Today,
most New Year’s festivities begin on December 31 (New
Year’s Eve), the last day of the Gregorian calendar, and
continue into the early hours of January 1 (New Year’s
Day). Common traditions include attending parties, eating
special New Year’s foods, making resolutions for the new
year and watching fireworks displays.
The earliest recorded festivities in honor of a new year’s
arrival date back some 4,000 years to ancient Babylon.
For the Babylonians, the first new moon following the
vernal equinox—the day in late March with an equal
amount of sunlight and darkness—heralded the start of a
new year. They marked the occasion with a massive
religious festival called Akitu (derived from the Sumerian
word for barley, which was cut in the spring) that
involved a different ritual on each of its 11 days.
Throughout antiquity, civilizations around the world
developed increasingly sophisticated calendars, typically
pinning the first day of the year to an agricultural or
astronomical event. In Egypt, for instance, the year began
with the annual flooding of the Nile, which coincided
with the rising of the star Sirius. The first day of the
Chinese new year, meanwhile, occurred with the second
new moon after the winter solstice.
In many countries, New Year’s celebrations begin on the
evening of December 31—New Year’s Eve—and
continue into the early hours of January 1st. In London,
the British welcome the New Year with spectacular
fireworks as Big Ben’s bells ring usher in a New Year.
A particularly striking aspect of the New Year's Eve
festivities is the ball drop in Times Square in Manhattan,
New York City. The ball is made of crystal and electric
lights and is placed on top of a pole, which is 77 feet, or
23 meters, high. At one minute before midnight on
December 31, the ball is lowered slowly down the pole. It
comes to rest at the bottom of the pole at exactly
midnight. The event is shown on television across the
United States and around the world. The event has been
held every year since 1907, except during World War II.
Page 74
HANNA & PLAUT LLP
ATTORNEYS AT LAW
Southwest Tower
211 East 7th Street, Suite 600
Austin, Texas 78701
Phone: 512.472.7700
Fax: 512.472.0205
ATTORNEYS
HANNA & PLAUT LLP ● ATTORNEYS AT LAW
J. Todd Key
Hanna & Plaut, LLP is an AV-rated law firm formed in 1998 by
University of Texas School of Law graduate David L. Plaut and
Stanford Law School graduate Catherine L. Hanna. Both Catherine
and David received their initial training at elite law firms and
wanted to combine that same level of high-quality legal work and
professionalism with the responsiveness of a small-firm. It is our
goal to provide the friendly client service and close personal
relationships that one associates with small law firms to the legal
work that is traditionally done by larger firms.
Eric S. Peabody
Our Practice
David L. Plaut
Hanna & Plaut handles state and federal trials, appeals, alternative
dispute resolution, and client counseling. The primary focus of our
practice is the representation of insurance carriers and agents in
insurance coverage and "bad faith" litigation, but our practice also
includes insurance defense, construction litigation, commercial
litigation, administrative law (including workers' compensation),
and subrogation matters. Our client list includes some of the top
national insurance carriers and our work takes us all over the state
of Texas.
Anne-Marie Abarado
Jeffrey C. Glass
Catherine L. Hanna
Robert F. Josey
Sheila S. Tan
Laura Tubbs
PRACTICE PRACTICE AREAS S
Appellate
Our Philosophy
General Commercial Litigation
Insurance Coverage and Bad Faith
Insurance Defense
Workers' Compensation
Visit Us Online
http://www.hannaplaut.com/index.html
At Hanna & Plaut, we pride ourselves on being creative in our
approach; advice and counsel at the outset of a dispute or even
before a dispute arises is often the most valuable service we can
provide. However, there are times when the best resolution for our
clients is through the litigation process and we are aggressive in
defense of our clients.
We believe that the best time to evaluate whether a case is
appropriate for further litigation or for settlement is at the outset
of our involvement in the case. We conduct a thorough analysis
and review upon receipt of each new matter, discuss the matter
with our client and interview key witnesses to ensure that we have
a complete understanding of the facts as well as a good "business"
sense of the case to go along with our legal understanding. We
then make initial recommendations for a case strategy.
AN ASSOCIATE MEMBER OF THE INSURANCE COUNCIL OF TEXAS
Page 75
Page 76
Workers’ Compensation Events Calendar
Texas Department of Insurance
Public Meetings and Hearings
The Texas Department of Insurance (TDI) does not have a public hearing scheduled.
TDI’s Agencey Calendar is available here.
Stakeholder Meetings
The Texas Department of Insurance has no stakeholder meetings scheduled at this time.
Division of Workers’ Compensation
Public Meetings and Hearings
The Division of Workers’ Compensation (DWC) does not currently public meetings or hearings scheduled.
Stakeholder Meetings
The Division of Workers’ Compensation (DWC) does not currently have a stakeholder meetings scheduled.
The DWC continues to hold a series of educational seminars for doctors and other stakeholders throughout
Texas. The event dates and locations are available on the Agency Calendar on the TDI website.
Insurance Council of Texas
2016 Mid-Year Property & Casualty Insurance Symposium
ICT and AFACT will host the 2016 Mid-Year Property & Casualty Insurance Symposium in Austin, Texas on
July 14, 2016. The symposium location, agenda, and online registration will be available on ICT’s website.
2016 Workers’ Compensation Conference
ICT will host its 2016 Workers’ Compensation Conference in Austin, Texas in the month of September 2016.
The conference agenda will be available on ICT’s website.
2016 Workers’ Compensation Seminars
ICT will hold a workers’ compensation seminars in Austin, Texas on April 21, 2016. A seminar will not be
held in the Dallas-Fort Worth area in 2016.
The seminar agenda and online registration for the 2016 seminars will be available on ICT’s website at a future
date.
Page 77

TEXAS WORKERS` COMPENSATION UPDATE

Transcription

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