6030-S AMH CL CORD 107

SSB 6030 - H COMM AMD ADOPTED 4-10-97

By Committee on Commerce & Labor

     Strike everything after the enacting clause and insert the following:

     "NEW SECTION. Sec. 1.  The legislature recognizes the importance of the state workers' compensation program in providing medical and financial services and benefits to workers who are injured on the job, and to their families, and in facilitating the injured workers' return to employment and a productive life.  In addition, the legislature considers periodic performance audits to be of assistance in determining the impact of state programs and in developing findings and recommendations that ensure the most effective use of worker, employer, state agency, and public time and resources.

NEW SECTION. Sec. 2.  The joint legislative audit and review committee, in consultation with members of the senate and house of representatives commerce and labor committees and the workers' compensation advisory committee established under RCW 51.04.110, shall conduct a performance audit of the state workers' compensation system.

     The performance audit shall review the following issues:

     (1)(a) The organizational structure of the workers' compensation system and its effectiveness;

     (b) The management principles, program process, and ongoing practices of the workers' compensation system;

     (2)(a) The program's taxation system, including the method of collection and the manner in which funds are prioritized and distributed;

     (b) The use of all revenues generated from reserve surpluses and all other fund sources;

     (3) The types of services and programs within the system;

     (4) The level of cooperation and continuity between program and services;

     (5)(a) The effectiveness of the system in providing sure and certain relief to injured workers as mandated by Title 51 RCW;

     (b) The effectiveness of the workers' compensation system in returning injured workers to work and meeting other system goals;

     (6) The level of customer satisfaction of workers and employers participating in the system;

     (7) The current method by which the department internally reviews and determines the workers' compensation program effectiveness and performance and its process for responding to its findings or recommendations;

     (8) The manner in which the workers' compensation system coordinates its activities with other programs or activities within the department or other state agencies, including: the WISHA program, the board of industrial insurance appeals, the employment security department, the department of revenue, the department of health, and the work force training and education coordinating board;

     (9) The cost-effectiveness and efficiency of the state workers' compensation system as compared with other private and public sector delivery systems;

     (10) Claims administration practices of the state fund, self-insured employers, and third-party administrators, and the effectiveness of department sanctions in promoting best practices in claims administration; and

     (11) Any other item considered necessary by the joint legislative audit and review committee.

NEW SECTION. Sec. 3.  The joint legislative audit and review committee is directed to contract with a private entity that is not affiliated with an insurance company, brokerage, or agency, consistent with the provisions of chapter 39.29 RCW.  The committee shall consult with the workers' compensation advisory committee in the design of the request for proposals from potential contractors and in the choice of a performance audit contractor.  The committee shall provide an interim report on its findings and recommendations to the appropriate house of representatives and senate standing committees by December 31, 1997, and a final report by August 1, 1998.

NEW SECTION. Sec. 4.  The department of labor and industries shall actively cooperate with the joint legislative audit and review committee in the course of the performance audit and provide information and assistance as necessary.  Funding for the performance audit in the amount, as determined by the joint legislative audit and review committee, is provided from the nonappropriated medical aid fund within the department of labor and industries.  The department will transfer the funds necessary to implement this act to the joint legislative audit and review committee through an interagency agreement.

NEW SECTION. Sec. 5.  If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected."

EFFECT:  The amendment (1) deletes references to a legislative advisory committee.  The JLARC must consult with members of the Senate and House Commerce & Labor Committees; (2) changes the audit to a review of the workers' compensation system and deletes the reference to a review of the program within the Department of Labor and Industries; (3) adds that the review of the department's coordination with other agencies must include the Board of Industrial Insurance Appeals and the Department of Health; (4) adds a review of claims administration practices and the effectiveness of department sanctions in promoting best practices; (5) makes reference to an interagency agreement for transferring the funds to pay for the audit; and (6) makes other technical changes.