HOUSE BILL REPORT

HB 677

BYRepresentatives Patrick, Wang and R. King; by request of  Department of Labor and Industries

Changing requirements relating to industrial insurance administration.

House Committe on Commerce & Labor

Majority Report:     The substitute bill be substituted therefor and the substitute bill do pass.  (10)

     Signed by Representatives Wang, Chair; Cole, Vice Chair; Fisch, Fisher, O'Brien, Patrick, Sanders, Sayan, C. Smith and Walker.

AS REPORTED BY COMMITTEE ON COMMERCE & LABOR FEBRUARY 9, 1987

BACKGROUND:

In 1985 legislation, the Department of Labor and Industries was required to pay interest on payments to medical providers if payment was delayed beyond sixty days.  This requirement was not specifically made applicable to self-insured employers.

Any award, decision or order of the Department of Labor and Industries may be appealed to the Board of Industrial Insurance Appeals within sixty days from the day the order was communicated to the parties.  The department may modify, reverse or change the order within the sixty day period or within thirty days after an appeal is filed.  The department may also hold the order in abeyance for ninety days.  If the department takes any action on the appeal, the board is directed to deny the appeal, without prejudice to the right of the party to appeal from any subsequent order of the department. No similar procedure for department action is provided in statute for notices of assessment issued to employers who have defaulted on payments to the department.

Under industrial insurance law, the director of the Department of Labor and Industries is authorized to issue subpoenas in connection with a department investigation of claims, billings or collection of premiums.

In September of 1983, the Washington State Supreme Court ruled that the partial exclusion of agricultural labor from the state's workers' compensation law was unconstitutional.  Under that provision, workers employed in agricultural labor who were not regularly and continuously employed by any one employer and who did not earn more than $150 from any one employer were not covered by industrial insurance.  The provision remains in statute but is without legal effect.

The statute also excludes corporate officers from the mandatory coverage provisions. The provision allows corporations to elect coverage for officers who are also employees.

SUMMARY:

SUBSTITUTE BILL:  Employers certified as self-insurers under the industrial insurance law are required to make payments to medical providers within sixty days of receipt of a proper billing or within sixty days after the claim is allowed.  Interest of one percent per month will be required on any late payment.

If an employer defaults in any payment due to the Department of Labor and Industries and the employer files an appeal of the notice of assessment for the amount due, the department may, within thirty days of the notice of appeal, modify, reverse or change the notice of assessment. The department may also hold the notice in abeyance pending further investigation.  If the department takes any action on the notice, the Board of Industrial Insurance Appeals is directed to deny the appeal, without prejudice to the employer's right to appeal from any subsequent notice of assessment issued by the department.

The authority to issue subpoenas during department investigations is granted to the director of the Department of Labor and Industries and to his or her authorized assistants.

The exemption of certain farmworkers from mandatory industrial insurance coverage is decodified.  Technical changes are made to clarify the exclusion of corporate officers from industrial insurance coverage.

SUBSTITUTE BILL COMPARED TO ORIGINAL:  A section is deleted that provides for criminal sanctions against employers and employees who knowingly give false information in an industrial insurance case. The deleted section is contained in a separate bill.

Fiscal Note:    Requested February 10, 1987.

House Committee ‑ Testified For:     Brett Buckley, Department of Labor and Industries;  Joe Dear, Department of Labor and Industries; and John Winney, Injured Workers' Awareness Committee.

House Committee - Testified Against: None Presented.

House Committee - Testimony For:     The bill is needed to make several administrative and housekeeping changes, to remove obsolete language, correct oversights in previous legislation and clarify department authority.

House Committee - Testimony Against: None Presented.