AN ACT Relating to industrial insurance benefits paid during appeal; amending RCW 51.52.050, 51.16.140, and 43.79A.040; reenacting and amending RCW 51.52.060; adding a new section to chapter 51.16 RCW; adding a new section to chapter 51.44 RCW; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. RCW 51.52.050 and 1987 c 151 s 1 are each amended to read as follows:

(1) Whenever the department has made any order, decision, or award, it shall promptly serve the worker, beneficiary, employer, or other person affected thereby, with a copy thereof by mail, which shall be addressed to such person at his or her last known address as shown by the records of the department. The copy, in case the same is a final order, decision, or award, shall bear on the same side of the same page on which is found the amount of the award, a statement, set in black faced type of at least ten point body or size, that such final order, decision, or award shall become final within sixty days from the date the order is communicated to the parties unless a written request for reconsideration is filed with the department of labor and industries, Olympia, or an appeal is filed with the board of industrial insurance appeals, Olympia((~~: PROVIDED, That~~)). However, a department order or decision making demand, whether with or without penalty, for repayment of sums paid to a provider of medical, dental, vocational, or other health services rendered to an industrially injured worker, shall state that such order or decision shall become final within twenty days from the date the order or decision is communicated to the parties unless a written request for reconsideration is filed with the department of labor and industries, Olympia, or an appeal is filed with the board of industrial insurance appeals, Olympia.

(2) Whenever the department has taken any action or made any decision relating to any phase of the administration of this title, the worker, beneficiary, employer, or other person aggrieved thereby may request reconsideration of the department, or may appeal to the board. If an employer requests reconsideration of a department order in favor of an injured worker, temporary total disability compensation or medical aid benefits granted to the worker by the order under reconsideration shall continue while the reconsideration is pending, subject to the requirements of RCW 51.32.240(3).

(3) In an appeal before the board, the appellant shall have the burden of proceeding with the evidence to establish a prima facie case for the relief sought in such appeal((~~: PROVIDED, That~~)). However, in an appeal from an order of the department that alleges fraud, the department or self-insured employer shall initially introduce all evidence in its case in chief. ((~~Any such~~)) A person aggrieved by the decision and order of the board may thereafter appeal to the superior court, as prescribed in this chapter.

Sec. 2. RCW 51.52.060 and 1995 c 253 s 1 and 1995 c 199 s 7 are each reenacted and amended to read as follows:

(1)(a) Except as otherwise specifically provided in this section, a worker, beneficiary, employer, health services provider, or other person aggrieved by an order, decision, or award of the department must, before he or she appeals to the courts, file with the board and the director, by mail or personally, within sixty days from the day on which a copy of the order, decision, or award was communicated to such person, a notice of appeal to the board. However, a health services provider or other person aggrieved by a department order or decision making demand, whether with or without penalty, solely for repayment of sums paid to a provider of medical, dental, vocational, or other health services rendered to an industrially injured worker must, before he or she appeals to the courts, file with the board and the director, by mail or personally, within twenty days from the day on which a copy of the order or decision was communicated to the health services provider upon whom the department order or decision was served, a notice of appeal to the board.

(b) Failure to file a notice of appeal with both the board and the department shall not be grounds for denying the appeal if the notice of appeal is filed with either the board or the department.

(2) Within ten days of the date on which an appeal has been granted by the board, the board shall notify the other interested parties to the appeal of the receipt of the appeal and shall forward a copy of the notice of appeal to the other interested parties. Within twenty days of the receipt of such notice of the board, the worker or the employer may file with the board a cross-appeal from the order of the department from which the original appeal was taken.

(3) If within the time limited for filing a notice of appeal to the board from an order, decision, or award of the department, the department directs the submission of further evidence or the investigation of any further fact, the time for filing the notice of appeal shall not commence to run until the person has been advised in writing of the final decision of the department in the matter. In the event the department directs the submission of further evidence or the investigation of any further fact, as provided in this section, the department shall render a final order, decision, or award within ninety days from the date further submission of evidence or investigation of further fact is ordered which time period may be extended by the department for good cause stated in writing to all interested parties for an additional ninety days.

(4) The department, either within the time limited for appeal, or within thirty days after receiving a notice of appeal, may:

(a) Modify, reverse, or change any order, decision, or award; or

(b)(i) Except as provided in (b)(ii) of this subsection, hold an order, decision, or award in abeyance for a period of ninety days which time period may be extended by the department for good cause stated in writing to all interested parties for an additional ninety days pending further investigation in light of the allegations of the notice of appeal; or

(ii) Hold an order, decision, or award issued under RCW 51.32.160 in abeyance for a period not to exceed ninety days from the date of receipt of an application under RCW 51.32.160. The department may extend the ninety-day time period for an additional sixty days for good cause.

For purposes of this subsection, good cause includes delay that results from conduct of the claimant that is subject to sanction under RCW 51.32.110.

The board shall deny the appeal upon the issuance of an order under (b)(i) or (ii) of this subsection holding an earlier order, decision, or award in abeyance, without prejudice to the appellant's right to appeal from any subsequent determinative order issued by the department.

This subsection (4)(b) does not apply to applications deemed granted under RCW 51.32.160.

(5) An employer shall have the right to appeal an application deemed granted under RCW 51.32.160 on the same basis as any other application adjudicated pursuant to that section.

(6) A provision of this section shall not be deemed to change, alter, or modify the practice or procedure of the department for the payment of awards pending appeal. However, if an employer appeals to the board a department order granting temporary total disability compensation or medical aid benefits to a worker, the worker shall be entitled to the compensation or medical aid benefits while the appeal is pending before the board, subject to the requirements of RCW 51.32.240(3).

NEW SECTION. Sec. 3. A new section is added to chapter 51.16 RCW to read as follows:

All employers shall pay an assessment for the benefit repayment account established in section 5 of this act. Every employer not qualifying as a self-insurer shall pay, on the schedule required for payment of premiums under RCW 51.16.060, a quarterly assessment of one-half of one percent of the premium deduction made under RCW 51.16.140(1)(a)(i). Self-insurers shall pay a pro rata assessment in a manner to be determined by the director. However, no assessments may be made under this section in any calendar quarter if, on the first day of the immediately preceding calendar quarter, the amount in the benefit payment account is one hundred thousand dollars or more.

Sec. 4. RCW 51.16.140 and 1989 c 385 s 3 are each amended to read as follows:

(1)(a) Except as provided in (b) of this subsection, every employer who is not a self-insurer shall deduct from the pay of each of his or her workers:

(i) One-half of the ((~~amount he or she~~)) premium the employer is required to pay, for medical benefits within each risk classification. Such amount shall be periodically determined by the director and reported by him or her to all employers under this title((~~: PROVIDED, That~~)); and

(ii) Except as limited by subsection (2) of this section, one-half of one percent of the premium deduction made under (a)(i) of this subsection.

(b) The state governmental unit shall pay the entire ((~~amount~~)) premium, without deduction, into the medical aid fund for volunteers, as defined in RCW 51.12.035, and the state apprenticeship council shall pay the entire ((~~amount~~)) premium, without deduction, into the medical aid fund for registered apprentices or trainees, for the purposes of RCW 51.12.130. The deductions under this section ((is)) are not authorized for premiums assessed under RCW 51.16.210.

(2) The amount deducted under subsection (1)(a)(ii) of this section shall be paid by the employer along with the employer premiums and assessments required under this title. The amounts remitted shall be deposited into the benefit repayment account established under section 5 of this act. However, no deduction may be made under subsection (1)(a)(ii) of this section in any calendar quarter if, on the first day of the immediately preceding calendar quarter, the amount in the benefit payment account is one hundred thousand dollars or more.

(3) It shall be unlawful for the employer, unless specifically authorized by this title, to deduct or obtain any part of the premium or other costs required to be by him or her paid from the wages or earnings of any of his or her workers, and the making of or attempt to make any such deduction shall be a gross misdemeanor.

NEW SECTION. Sec. 5. A new section is added to chapter 51.44 RCW to read as follows:

The benefit repayment account is created in the custody of the state treasurer. All receipts from the deductions required under RCW 51.16.140(1)(a)(ii) and assessments under section 3 of this act shall be deposited into the account. Transfers from the benefit repayment account to the medical aid fund or the accident fund, or payments from the account to self-insured employers, as applicable, shall be made when benefits are paid under RCW 51.52.050(2) or 51.52.060(6), the department order granting benefits is reversed or modified resulting in an overpayment of benefits to the worker, and the director has exercised his or her discretion to waive recovery of the overpayment under RCW 51.32.240(3).

Sec. 6. RCW 43.79A.040 and 1998 c 268 s 1 are each amended to read as follows:

(1) Money in the treasurer's trust fund may be deposited, invested, and reinvested by the state treasurer in accordance with RCW 43.84.080 in the same manner and to the same extent as if the money were in the state treasury.

(2) All income received from investment of the treasurer's trust fund shall be set aside in an account in the treasury trust fund to be known as the investment income account.

(3) The investment income account may be utilized for the payment of purchased banking services on behalf of treasurer's trust funds including, but not limited to, depository, safekeeping, and disbursement functions for the state treasurer or affected state agencies. The investment income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for payments to financial institutions. Payments shall occur prior to distribution of earnings set forth in subsection (4) of this section.

(4)(a) Monthly, the state treasurer shall distribute the earnings credited to the investment income account to the state general fund except under (b) and (c) of this subsection.

(b) The following accounts and funds shall receive their proportionate share of earnings based upon each account's or fund's average daily balance for the period: The Washington advanced college tuition payment program account, the agricultural local fund, the American Indian scholarship endowment fund, the Washington international exchange scholarship endowment fund, the energy account, the fair fund, the game farm alternative account, the grain inspection revolving fund, the rural rehabilitation account, the stadium and exhibition center account, the youth athletic facility grant account, the self-insurance revolving fund, the sulfur dioxide abatement account, ((~~and~~)) the children's trust fund, and the benefit repayment account. However, the earnings to be distributed shall first be reduced by the allocation to the state treasurer's service fund pursuant to RCW 43.08.190.

(c) The following accounts and funds shall receive eighty percent of their proportionate share of earnings based upon each account's or fund's average daily balance for the period: The advanced right of way revolving fund, the advanced environmental mitigation revolving account, the federal narcotics asset forfeitures account, the high occupancy vehicle account, the local rail service assistance account, and the miscellaneous transportation programs account.

(5) In conformance with Article II, section 37 of the state Constitution, no trust accounts or funds shall be allocated earnings without the specific affirmative directive of this section.

NEW SECTION. Sec. 7. Sections 3 and 4 of this act apply to premiums and assessments for calendar quarters beginning on or after July 1, 1999.