Senate Bill No. 42–Committee on Commerce and Labor

Prefiled January 27, 1999

(On Behalf of Legislative Committee on Workers’ Compensation)

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Referred to Committee on Commerce and Labor

 

SUMMARY—Revises provisions governing payment of workers’ compensation for subsequent injuries from subsequent injury funds. (BDR 53-389)

FISCAL NOTE: Effect on Local Government: No.

Effect on the State or on Industrial Insurance: No.

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).

 

AN ACT relating to industrial insurance; revising the provisions regarding those subsequent injuries for which the account of an employer who is insured by the state industrial insurance system will be charged; limiting the subsequent injuries for which workers’ compensation is payable from the subsequent injury fund for self-insured employers and the subsequent injury fund for associations of self-insured public or private employers; repealing the provisions creating and governing a subsequent injury fund for private carriers of industrial insurance; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

1-1 Section 1. NRS 616B.540 is hereby amended to read as follows:

1-2 616B.540 1. If an employee of an employer who is insured by the

1-3 system has a permanent physical impairment from any cause or origin and ,

1-4 before July 1, 1999, incurs a subsequent disability by injury arising out of

1-5 and in the course of his employment which entitles him to compensation for

1-6 a disability that is substantially greater by reason of the combined effects of

1-7 the preexisting impairment and the subsequent injury than that which would

1-8 have resulted from the subsequent injury alone, the compensation due must

1-9 not be charged to the employer’s account if:

1-10 (a) The employee knowingly made a false representation as to his

1-11 physical condition at the time he was hired by the employer;

1-12 (b) The employer relied upon the false representation and this reliance

1-13 formed a substantial basis of the employment; and

2-1 (c) A causal connection existed between the false representation and the

2-2 subsequent disability.

2-3 2. If the subsequent injury of the employee that occurred before July 1,

2-4 1999, results in his death and it is determined that the death would not have

2-5 occurred except for the preexisting permanent physical impairment, the

2-6 compensation due must not be charged to the employer’s account.

2-7 3. To qualify for the removal of a charge from his account pursuant to

2-8 this section, the employer must establish by written records that he had

2-9 knowledge of the permanent physical impairment at the time the employee

2-10 was hired or that the employee was retained in employment after the

2-11 employer acquired that knowledge.

2-12 4. The employer shall notify the manager of any possible claim

2-13 pursuant to this section as soon as practicable, but not later than 100 weeks

2-14 after the subsequent injury or death.

2-15 5. The manager shall take such actions as are necessary to carry out the

2-16 requirements of this section.

2-17 6. An appeal of any decision made concerning a charge or removal of a

2-18 charge pursuant to this section must be submitted directly to an appeals

2-19 officer. The appeals officer shall hear the appeal within 45 days after the

2-20 appeal is submitted to him.

2-21 7. As used in this section, "permanent physical impairment" means any

2-22 permanent condition, whether congenital or caused by injury or disease, of

2-23 such seriousness as to constitute a hindrance or obstacle to obtaining

2-24 employment or to obtaining reemployment if the employee is unemployed.

2-25 For the purposes of this section, a condition is not a "permanent physical

2-26 impairment" unless it would support a rating of permanent impairment of 6

2-27 percent or more of the whole man if evaluated according to the American

2-28 Medical Association’s Guides to the Evaluation of Permanent Impairment

2-29 as adopted and supplemented pursuant to NRS 616C.110.

2-30 Sec. 2. NRS 616B.557 is hereby amended to read as follows:

2-31 616B.557 Except as otherwise provided in NRS 616B.560:

2-32 1. If an employee of a self-insured employer has a permanent physical

2-33 impairment from any cause or origin and before July 1, 1999, incurs a

2-34 subsequent disability by injury arising out of and in the course of his

2-35 employment which entitles him to compensation for disability that is

2-36 substantially greater by reason of the combined effects of the preexisting

2-37 impairment and the subsequent injury than that which would have resulted

2-38 from the subsequent injury alone, the compensation due must be charged to

2-39 the subsequent injury fund for self-insured employers in accordance with

2-40 regulations adopted by the board.

2-41 2. If the subsequent injury of [such an] the employee that occurred

2-42 before July 1, 1999, results in his death and it is determined that the death

2-43 would not have occurred except for the preexisting permanent physical

3-1 impairment, the compensation due must be charged to the subsequent injury

3-2 fund for self-insured employers in accordance with regulations adopted by

3-3 the board.

3-4 3. As used in this section, "permanent physical impairment" means any

3-5 permanent condition, whether congenital or caused by injury or disease, of

3-6 such seriousness as to constitute a hindrance or obstacle to obtaining

3-7 employment or to obtaining reemployment if the employee is unemployed.

3-8 For the purposes of this section, a condition is not a "permanent physical

3-9 impairment" unless it would support a rating of permanent impairment of 6

3-10 percent or more of the whole man if evaluated according to the American

3-11 Medical Association’s Guides to the Evaluation of Permanent Impairment

3-12 as adopted and supplemented by the division pursuant to NRS 616C.110.

3-13 4. To qualify under this section for reimbursement from the subsequent

3-14 injury fund for self-insured employers, the self-insured employer must

3-15 establish by written records that the self-insured employer had knowledge of

3-16 the "permanent physical impairment" at the time the employee was hired or

3-17 that the employee was retained in employment after the self-insured

3-18 employer acquired such knowledge.

3-19 5. A self-insured employer shall notify the board of any possible claim

3-20 against the subsequent injury fund for self-insured employers as soon as

3-21 practicable, but not later than 100 weeks after the injury or death.

3-22 6. The board shall adopt regulations establishing procedures for

3-23 submitting claims against the subsequent injury fund for self-insured

3-24 employers. The board shall notify the self-insured employer of [his] its

3-25 decision on [such a] the claim within 90 days after the claim is received.

3-26 7. An appeal of any decision made concerning a claim against the

3-27 subsequent injury fund for self-insured employers must be submitted

3-28 directly to the district court.

3-29 Sec. 3. NRS 616B.560 is hereby amended to read as follows:

3-30 616B.560 1. A self-insured employer who pays compensation due to

3-31 an employee who has a permanent physical impairment from any cause or

3-32 origin and who, before July 1, 1999, incurs a subsequent disability by

3-33 injury arising out of and in the course of his employment which entitles him

3-34 to compensation for disability that is substantially greater by reason of the

3-35 combined effects of the preexisting impairment and the subsequent injury

3-36 than that which would have resulted from the subsequent injury alone is

3-37 entitled to be reimbursed from the subsequent injury fund for self-insured

3-38 employers if:

3-39 (a) The employee knowingly made a false representation as to his

3-40 physical condition at the time he was hired by the self-insured employer;

3-41 (b) The self-insured employer relied upon the false representation and

3-42 this reliance formed a substantial basis of the employment; and

4-1 (c) A causal connection existed between the false representation and the

4-2 subsequent disability.

4-3 If the subsequent injury of the employee that occurred before July 1, 1999,

4-4 results in his death and it is determined that the death would not have

4-5 occurred except for the preexisting permanent physical impairment, any

4-6 compensation paid is entitled to be reimbursed from the subsequent injury

4-7 fund for self-insured employers.

4-8 2. A self-insured employer shall notify the board of any possible claim

4-9 against the subsequent injury fund for self-insured employers pursuant to

4-10 this section [no] not later than 60 days after the date of the subsequent

4-11 injury or the date the self-insured employer learns of the employee’s false

4-12 representation, whichever is later.

4-13 Sec. 4. NRS 616B.578 is hereby amended to read as follows:

4-14 616B.578 Except as otherwise provided in NRS 616B.581:

4-15 1. If an employee of a member of an association of self-insured public

4-16 or private employers has a permanent physical impairment from any cause

4-17 or origin and before July 1, 1999, incurs a subsequent disability by injury

4-18 arising out of and in the course of his employment which entitles him to

4-19 compensation for disability that is substantially greater by reason of the

4-20 combined effects of the preexisting impairment and the subsequent injury

4-21 than that which would have resulted from the subsequent injury alone, the

4-22 compensation due must be charged to the subsequent injury fund for

4-23 associations of self-insured public or private employers in accordance with

4-24 regulations adopted by the board.

4-25 2. If the subsequent injury of [such an] the employee that occurred

4-26 before July 1, 1999, results in his death and it is determined that the death

4-27 would not have occurred except for the preexisting permanent physical

4-28 impairment, the compensation due must be charged to the subsequent injury

4-29 fund for associations of self-insured public or private employers in

4-30 accordance with regulations adopted by the board.

4-31 3. As used in this section, "permanent physical impairment" means any

4-32 permanent condition, whether congenital or caused by injury or disease, of

4-33 such seriousness as to constitute a hindrance or obstacle to obtaining

4-34 employment or to obtaining reemployment if the employee is unemployed.

4-35 For the purposes of this section, a condition is not a "permanent physical

4-36 impairment" unless it would support a rating of permanent impairment of 6

4-37 percent or more of the whole man if evaluated according to the American

4-38 Medical Association’s Guides to the Evaluation of Permanent Impairment

4-39 as adopted and supplemented by the division pursuant to NRS 616C.110.

4-40 4. To qualify under this section for reimbursement from the subsequent

4-41 injury fund for associations of self-insured public or private employers, the

4-42 association of self-insured public or private employers must establish by

4-43 written records that the employer had knowledge of the "permanent physical

5-1 impairment" at the time the employee was hired or that the employee was

5-2 retained in employment after the employer acquired such knowledge.

5-3 5. An association of self-insured public or private employers shall

5-4 notify the board of any possible claim against the subsequent injury fund for

5-5 associations of self-insured public or private employers as soon as

5-6 practicable, but not later than 100 weeks after the injury or death.

5-7 6. The board shall adopt regulations establishing procedures for

5-8 submitting claims against the subsequent injury fund for associations of self-

5-9 insured public or private employers. The board shall notify the association

5-10 of self-insured public or private employers of its decision on [such a] the

5-11 claim within 90 days after the claim is received.

5-12 7. An appeal of any decision made concerning a claim against the

5-13 subsequent injury fund for associations of self-insured public or private

5-14 employers must be submitted directly to the district court.

5-15 Sec. 5. NRS 616B.581 is hereby amended to read as follows:

5-16 616B.581 1. An association of self-insured public or private

5-17 employers that pays compensation due to an employee who has a permanent

5-18 physical impairment from any cause or origin and who, before July 1, 1999,

5-19 incurs a subsequent disability by injury arising out of and in the course of

5-20 his employment which entitles him to compensation for disability that is

5-21 substantially greater by reason of the combined effects of the preexisting

5-22 impairment and the subsequent injury than that which would have resulted

5-23 from the subsequent injury alone is entitled to be reimbursed from the

5-24 subsequent injury fund for associations of self-insured public or private

5-25 employers if:

5-26 (a) The employee knowingly made a false representation as to his

5-27 physical condition at the time he was hired by the member of the association

5-28 of self-insured public or private employers;

5-29 (b) The employer relied upon the false representation and this reliance

5-30 formed a substantial basis of the employment; and

5-31 (c) A causal connection existed between the false representation and the

5-32 subsequent disability.

5-33 If the subsequent injury of the employee that occurred before July 1, 1999,

5-34 results in his death and it is determined that the death would not have

5-35 occurred except for the preexisting permanent physical impairment, any

5-36 compensation paid is entitled to be reimbursed from the subsequent injury

5-37 fund for associations of self-insured public or private employers.

5-38 2. An association of self-insured public or private employers shall

5-39 notify the board of any possible claim against the subsequent injury fund for

5-40 associations of self-insured public or private employers pursuant to this

5-41 section [no] not later than 60 days after the date of the subsequent injury or

5-42 the date the employer learns of the employee’s false representation,

5-43 whichever is later.

6-1 Sec. 6. NRS 616B.584, 616B.587 and 616B.590 are hereby repealed.

6-2 Sec. 7. 1. This section and sections 1 to 5, inclusive, of this act

6-3 become effective on July 1, 1999.

6-4 2. Section 6 of this act becomes effective upon passage and approval.

 

6-5 TEXT OF REPEALED SECTIONS

 

6-6 616B.584 1. There is hereby established as a special revenue fund in

6-7 the state treasury the subsequent injury fund for private carriers, which may

6-8 be used only to make payments in accordance with the provisions of NRS

6-9 616B.587 and 616B.590. The administrator shall administer the fund.

6-10 2. All assessments, penalties, bonds, securities and all other properties

6-11 received, collected or acquired by the administrator for the subsequent

6-12 injury fund for private carriers must be delivered to the custody of the state

6-13 treasurer.

6-14 3. All money and securities in the fund must be held by the state

6-15 treasurer as custodian thereof to be used solely for workers’ compensation

6-16 for employees whose employers are insured by private carriers.

6-17 4. The state treasurer may disburse money from the fund only upon

6-18 written order of the state controller.

6-19 5. The state treasurer shall invest money of the fund in the same manner

6-20 and in the same securities in which he is authorized to invest state general

6-21 funds which are in his custody. Income realized from the investment of the

6-22 assets of the fund must be credited to the fund.

6-23 6. The administrator shall adopt regulations for the establishment and

6-24 administration of assessment rates, payments and penalties. Assessment

6-25 rates must reflect the relative hazard of the employments covered by private

6-26 carriers and must be based upon expected annual expenditures for claims for

6-27 payments from the subsequent injury fund for private carriers. The system

6-28 must not be required to pay any assessments, payments or penalties into the

6-29 subsequent injury fund for private carriers, or any costs associated with the

6-30 fund.

6-31 7. The commissioner shall assign an actuary to review the establishment

6-32 of assessment rates. The rates must be filed with the commissioner 30 days

6-33 before their effective date. Any private carrier who wishes to appeal the rate

6-34 so filed must do so pursuant to NRS 679B.310.

6-35 616B.587 Except as otherwise provided in NRS 616B.590:

6-36 1. If an employee of an employer who is insured by a private carrier has

6-37 a permanent physical impairment from any cause or origin and incurs a

6-38 subsequent disability by injury arising out of and in the course of his

6-39 employment which entitles him to compensation for disability that is

7-1 substantially greater by reason of the combined effects of the preexisting

7-2 impairment and the subsequent injury than that which would have resulted

7-3 from the subsequent injury alone, the compensation due must be charged to

7-4 the subsequent injury fund for private carriers in accordance with

7-5 regulations adopted by the administrator.

7-6 2. If the subsequent injury of such an employee results in his death and

7-7 it is determined that the death would not have occurred except for the

7-8 preexisting permanent physical impairment, the compensation due must be

7-9 charged to the subsequent injury fund for private carriers in accordance with

7-10 regulations adopted by the administrator.

7-11 3. As used in this section, "permanent physical impairment" means any

7-12 permanent condition, whether congenital or caused by injury or disease, of

7-13 such seriousness as to constitute a hindrance or obstacle to obtaining

7-14 employment or to obtaining reemployment if the employee is unemployed.

7-15 For the purposes of this section, a condition is not a "permanent physical

7-16 impairment" unless it would support a rating of permanent impairment of 6

7-17 percent or more of the whole man if evaluated according to the American

7-18 Medical Association’s Guides to the Evaluation of Permanent Impairment

7-19 as adopted and supplemented by the division pursuant to NRS 616C.110.

7-20 4. To qualify under this section for reimbursement from the subsequent

7-21 injury fund for private carriers, the private carrier must establish by written

7-22 records that the employer had knowledge of the "permanent physical

7-23 impairment" at the time the employee was hired or that the employee was

7-24 retained in employment after the employer acquired such knowledge.

7-25 5. A private carrier shall notify the administrator of any possible claim

7-26 against the subsequent injury fund for private carriers as soon as practicable,

7-27 but not later than 100 weeks after the injury or death.

7-28 6. The administrator shall adopt regulations establishing procedures for

7-29 submitting claims against the subsequent injury fund for private carriers.

7-30 The administrator shall notify the private carrier of his decision on such a

7-31 claim within 90 days after the claim is received.

7-32 7. An appeal of any decision made concerning a claim against the

7-33 subsequent injury fund for private carriers must be submitted directly to the

7-34 appeals officer. The appeals officer shall hear such an appeal within 45 days

7-35 after the appeal is submitted to him.

7-36 616B.590 1. A private carrier who pays compensation due to an

7-37 employee who has a permanent physical impairment from any cause or

7-38 origin and incurs a subsequent disability by injury arising out of and in the

7-39 course of his employment which entitles him to compensation for disability

7-40 that is substantially greater by reason of the combined effects of the

7-41 preexisting impairment and the subsequent injury than that which would

7-42 have resulted from the subsequent injury alone is entitled to be reimbursed

7-43 from the subsequent injury fund for private carriers if:

8-1 (a) The employee knowingly made a false representation as to his

8-2 physical condition at the time he was hired by the employer insured by a

8-3 private carrier;

8-4 (b) The employer relied upon the false representation and this reliance

8-5 formed a substantial basis of the employment; and

8-6 (c) A causal connection existed between the false representation and the

8-7 subsequent disability.

8-8 If the subsequent injury of the employee results in his death and it is

8-9 determined that the death would not have occurred except for the

8-10 preexisting permanent physical impairment, any compensation paid is

8-11 entitled to be reimbursed from the subsequent injury fund for private

8-12 carriers.

8-13 2. A private carrier shall notify the administrator of any possible claim

8-14 against the subsequent injury fund for private carriers pursuant to this

8-15 section no later than 60 days after the date of the subsequent injury or the

8-16 date the employer learns of the employee’s false representation, whichever

8-17 is later.

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