Senate Bill No. 320–Senator Shaffer (by request)

 

March 17, 2003

____________

 

Referred to Committee on Commerce and Labor

 

SUMMARY—Makes various changes to provisions governing industrial insurance. (BDR 53‑600)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: Yes.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to industrial insurance; establishing a system of external review for certain matters relating to industrial insurance; providing for the regulation and certification of certain external review organizations; providing for the payment of certain regulatory fees by external review organizations; revising various provisions relating to the payment of compensation to injured employees; revising certain procedures and establishing certain requirements relating to the adjudication of contested claims; 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.  Chapter 616A of NRS is hereby amended by

1-2  adding thereto the provisions set forth as sections 2 and 3 of this act.

1-3  Sec. 2.  “External review organization” means an

1-4  organization which has been issued a certificate pursuant to

1-5  section 3 of this act that authorizes the organization to conduct

1-6  external reviews for the purposes of chapters 616A to 616D,

1-7  inclusive, of NRS.

1-8  Sec. 3.  1.  If the Commissioner determines that an external

1-9  review organization is qualified to conduct external reviews for the

1-10  purposes of chapters 616A to 616D, inclusive, of NRS, the

1-11  Commissioner shall issue a certificate to the external review

1-12  organization that authorizes the organization to conduct such

2-1  external reviews in accordance with the provisions of section 5 of

2-2  this act and the regulations adopted by the Commissioner.

2-3  2.  The Commissioner shall adopt regulations setting forth the

2-4  procedures that an external review organization must follow to be

2-5  issued a certificate to conduct external reviews. The regulations

2-6  must include, without limitation, provisions setting forth:

2-7  (a) The manner in which an external review organization may

2-8  apply for a certificate and the requirements for the issuance and

2-9  renewal of the certificate pursuant to this section;

2-10      (b) The grounds for which the Commissioner may refuse to

2-11  issue, suspend, revoke or refuse to renew a certificate issued

2-12  pursuant to this section;

2-13      (c) The manner and circumstances under which an external

2-14  review organization is required to conduct its business; and

2-15      (d) A fee for issuing or renewing a certificate of an external

2-16  review organization pursuant to this section. The fee must not

2-17  exceed the cost of issuing or renewing the certificate.

2-18      3.  A certificate issued pursuant to this section expires 1 year

2-19  after it is issued and may be renewed in accordance with

2-20  regulations adopted by the Commissioner.

2-21      4.  Before the Commissioner may issue a certificate to an

2-22  external review organization, the external review organization

2-23  must:

2-24      (a) Demonstrate to the satisfaction of the Commissioner that it

2-25  is able to carry out, in a timely manner, the duties of an external

2-26  review organization as set forth in section 5 of this act and the

2-27  regulations adopted by the Commissioner. The demonstration

2-28  must include, without limitation, proof that the external review

2-29  organization employs, contracts with or otherwise retains only

2-30  persons who are qualified because of their education, training,

2-31  professional licensing and experience to perform the duties

2-32  assigned to those persons; and

2-33      (b) Provide assurances satisfactory to the Commissioner that

2-34  the external review organization will:

2-35          (1) Conduct external reviews in accordance with the

2-36  provisions of section 5 of this act and the regulations adopted by

2-37  the Commissioner;

2-38          (2) Render its decisions in a clear, consistent, thorough and

2-39  timely manner; and

2-40          (3) Avoid conflicts of interest.

2-41      5.  For the purposes of this section, an external review

2-42  organization has a conflict of interest if the external review

2-43  organization or any employee, agent or contractor of the external

2-44  review organization who conducts an external review has a

2-45  professional, familial or financial interest of a material nature

3-1  with respect to any person who has a substantial interest in the

3-2  outcome of the external review, including, without limitation:

3-3  (a) The claimant;

3-4  (b) The employer; or

3-5  (c) The insurer or any officer, director or management

3-6  employee of the insurer.

3-7  6.  The Commissioner shall not issue a certificate to an

3-8  external review organization that is affiliated with:

3-9  (a) An organization for managed care which provides

3-10  comprehensive medical and health care services to employees for

3-11  injuries or diseases pursuant to chapters 616A to 617, inclusive, of

3-12  NRS;

3-13      (b) An insurer;

3-14      (c) A third-party administrator; or

3-15      (d) A national, state or local trade association.

3-16      7.  An external review organization which is certified or

3-17  accredited by an accrediting body that is nationally recognized

3-18  shall be deemed to have satisfied all the conditions and

3-19  qualifications required for the external review organization to be

3-20  issued a certificate pursuant to this section.

3-21      Sec. 4.  NRS 616A.025 is hereby amended to read as follows:

3-22      616A.025  As used in chapters 616A to 616D, inclusive, of

3-23  NRS, unless the context otherwise requires, the words and terms

3-24  defined in NRS 616A.030 to 616A.360, inclusive, and section 2 of

3-25  this act have the meanings ascribed to them in those sections.

3-26      Sec. 5.  Chapter 616C of NRS is hereby amended by adding

3-27  thereto a new section to read as follows:

3-28      1.  Not later than 5 business days after the date that an

3-29  external review organization receives a request for an external

3-30  review, the external review organization shall:

3-31      (a) Review the documents and materials submitted for the

3-32  external review; and

3-33      (b) Notify the injured employee, his employer and the insurer

3-34  whether the external review organization needs any additional

3-35  information to conduct the external review.

3-36      2.  The external review organization shall render a decision

3-37  on the matter not later than 15 business days after the date that it

3-38  receives all information that is necessary to conduct the external

3-39  review.

3-40      3.  In conducting the external review, the external review

3-41  organization shall consider, without limitation:

3-42      (a) The medical records of the insured;

3-43      (b) Any recommendations of the physician of the insured; and

3-44      (c) Any other information approved by the Commissioner for

3-45  consideration by an external review organization.

4-1  4.  In its decision, the external review organization shall

4-2  specify the reasons for its decision. The external review

4-3  organization shall submit a copy of its decision to:

4-4  (a) The injured employee;

4-5  (b) The employer;

4-6  (c) The insurer; and

4-7  (d) The appeals officer, if any.

4-8  5.  The insurer shall pay the costs of the services provided by

4-9  the external review organization.

4-10      6.  The Commissioner shall adopt regulations to govern the

4-11  process of external review and to carry out the provisions of this

4-12  section. The regulations must provide that:

4-13      (a) All parties must agree to the submission of a matter to an

4-14  external review organization before a request for external review

4-15  may be submitted;

4-16      (b) A party may not be ordered to submit a matter to an

4-17  external review organization; and

4-18      (c) The findings and decisions of an external review

4-19  organization are not binding.

4-20      Sec. 6.  NRS 616C.245 is hereby amended to read as follows:

4-21      616C.245  1.  Every injured employee within the provisions of

4-22  chapters 616A to 616D, inclusive, of NRS is entitled to receive

4-23  promptly such accident benefits as may reasonably be required at

4-24  the time of the injury and within 6 months thereafter. Such benefits

4-25  may be further extended for additional periods as may be required.

4-26      2.  An injured employee is entitled to receive as an accident

4-27  benefit a motor vehicle that is modified to allow the employee to

4-28  operate the vehicle safely if:

4-29      (a) As a result of an injury arising out of and in the course of his

4-30  employment, he is quadriplegic, paraplegic or has had a part of his

4-31  body amputated; and

4-32      (b) He cannot be fitted with a prosthetic device which allows

4-33  him to operate a motor vehicle safely.

4-34      3.  If an injured employee is entitled to receive a motor vehicle

4-35  pursuant to subsection 2, a motor vehicle must be modified to allow

4-36  the employee to operate it safely in the following order of

4-37  preference:

4-38      (a) A motor vehicle owned by the injured employee must be so

4-39  modified if the insurer or employer providing accident benefits

4-40  determines that it is reasonably feasible to do so.

4-41      (b) A used motor vehicle must be so modified if the insurer or

4-42  employer providing accident benefits determines that it is

4-43  reasonably feasible to do so.

4-44      (c) A new motor vehicle must be so modified.

5-1  4.  The Administrator shall adopt regulations establishing a

5-2  maximum benefit to be paid under the provisions of this section.

5-3  Sec. 7.  NRS 616C.315 is hereby amended to read as follows:

5-4  616C.315  1.  Any person who is subject to the jurisdiction of

5-5  the hearing officers pursuant to chapters 616A to 616D, inclusive, or

5-6  chapter 617 of NRS may request a hearing before a hearing officer

5-7  of any matter within the hearing officer’s authority. The insurer

5-8  shall provide, without cost, the forms necessary to request a hearing

5-9  to any person who requests them.

5-10      2.  A hearing must not be scheduled until the following

5-11  information is provided to the hearing officer:

5-12      (a) The name of:

5-13          (1) The claimant;

5-14          (2) The employer; and

5-15          (3) The insurer or third-party administrator;

5-16      (b) The number of the claim; and

5-17      (c) If applicable, a copy of the letter of determination being

5-18  appealed, or if such a copy is unavailable, the date of the

5-19  determination and the issues stated in the determination.

5-20      3.  Except as otherwise provided in NRS 616B.772, 616B.775,

5-21  616B.787 and 616C.305, a person who is aggrieved by:

5-22      (a) A written determination of an insurer; or

5-23      (b) The failure of an insurer to respond within 30 days to a

5-24  written request mailed to the insurer by the person who is

5-25  aggrieved,

5-26  may appeal from the determination or failure to respond by filing a

5-27  request for a hearing before a hearing officer. Such a request must

5-28  include the information required pursuant to subsection 2 and

5-29  must be filed within 70 days after the date on which the notice of

5-30  the insurer’s determination was mailed by the insurer or the

5-31  unanswered written request was mailed to the insurer, as applicable.

5-32  The failure of an insurer to respond to a written request for a

5-33  determination within 30 days after receipt of such a request shall be

5-34  deemed by the hearing officer to be a denial of the request.

5-35      [3.] 4.  Failure to file a request for a hearing within the period

5-36  specified in subsection [2] 3 may be excused if the person aggrieved

5-37  shows by a preponderance of the evidence that he did not receive

5-38  the notice of the determination and the forms necessary to request a

5-39  hearing. The claimant or employer shall notify the insurer of a

5-40  change of address.

5-41      [4.] 5.  The hearing before the hearing officer must be

5-42  conducted as expeditiously and informally as is practicable.

5-43      [5.] 6.  The parties to a contested claim may, if the claimant is

5-44  represented by legal counsel, agree to forego a hearing before a

6-1  hearing officer and submit the contested claim directly to an appeals

6-2  officer.

6-3  Sec. 8.  NRS 616C.330 is hereby amended to read as follows:

6-4  616C.330 1.  The hearing officer shall:

6-5  (a) [Within] Except as otherwise provided in subsection 2 of

6-6  NRS 616C.315, within 5 days after receiving a request for a

6-7  hearing, set the hearing for a date and time within 30 days after his

6-8  receipt of the request;

6-9  (b) Give notice by mail or by personal service to all interested

6-10  parties to the hearing at least 15 days before the date and time

6-11  scheduled; and

6-12      (c) Conduct hearings expeditiously and informally.

6-13      2.  The notice must include a statement that the injured

6-14  employee may be represented by a private attorney or seek

6-15  assistance and advice from the Nevada Attorney for Injured

6-16  Workers.

6-17      3.  If necessary to resolve a medical question concerning an

6-18  injured employee’s condition or to determine the necessity of

6-19  treatment for which authorization for payment has been denied, the

6-20  hearing officer may refer the employee to a physician or

6-21  chiropractor of his choice who has demonstrated special competence

6-22  to treat the particular medical condition of the employee. If the

6-23  medical question concerns the rating of a permanent disability, the

6-24  hearing officer may refer the employee to a rating physician or

6-25  chiropractor. The rating physician or chiropractor must be selected

6-26  in rotation from the list of qualified physicians and chiropractors

6-27  maintained by the Administrator pursuant to subsection 2 of NRS

6-28  616C.490, unless the insurer and injured employee otherwise agree

6-29  to a rating physician or chiropractor. The insurer shall pay the costs

6-30  of any medical examination requested by the hearing officer.

6-31      4.  If an injured employee has requested payment for the cost of

6-32  obtaining a second determination of his percentage of disability

6-33  pursuant to NRS 616C.100, the hearing officer shall decide whether

6-34  the determination of the higher percentage of disability made

6-35  pursuant to NRS 616C.100 is appropriate and, if so, may order the

6-36  insurer to pay to the employee an amount equal to the maximum

6-37  allowable fee established by the Administrator pursuant to NRS

6-38  616C.260 for the type of service performed, or the usual fee of that

6-39  physician or chiropractor for such service, whichever is less.

6-40      5.  The hearing officer shall order an insurer, organization for

6-41  managed care or employer who provides accident benefits for

6-42  injured employees pursuant to NRS 616C.265 to pay the charges of

6-43  a provider of health care if the conditions of NRS 616C.138 are

6-44  satisfied.

7-1  6.  The hearing officer may allow or forbid the presence of a

7-2  court reporter and the use of a tape recorder in a hearing.

7-3  7.  The hearing officer shall render his decision within 15 days

7-4  after:

7-5  (a) The hearing; or

7-6  (b) He receives a copy of the report from the medical

7-7  examination he requested.

7-8  8.  The hearing officer shall render his decision in the most

7-9  efficient format developed by the Chief of the Hearings Division of

7-10  the Department of Administration.

7-11      9.  The hearing officer shall give notice of his decision to each

7-12  party by mail. He shall include with the notice of his decision the

7-13  necessary forms for appealing from the decision.

7-14      10.  Except as otherwise provided in NRS 616C.380, the

7-15  decision of the hearing officer is not stayed if an appeal from that

7-16  decision is taken unless an application for a stay is submitted by a

7-17  party. If such an application is submitted, the decision is

7-18  automatically stayed until a determination is made on the

7-19  application. A determination on the application must be made within

7-20  30 days after the filing of the application. If, after reviewing the

7-21  application, a stay is not granted by the hearing officer or an appeals

7-22  officer, the decision must be complied with within 10 days after the

7-23  refusal to grant a stay.

7-24      Sec. 9.  NRS 616C.345 is hereby amended to read as follows:

7-25      616C.345  1.  Any party aggrieved by a decision of the

7-26  hearing officer relating to a claim for compensation may appeal

7-27  from the decision by filing a notice of appeal with an appeals officer

7-28  within 30 days after the date of the decision.

7-29      2.  A hearing must not be scheduled until the following

7-30  information is provided to the appeals officer:

7-31      (a) The name of:

7-32          (1) The claimant;

7-33          (2) The employer; and

7-34          (3) The insurer or third-party administrator;

7-35      (b) The number of the claim; and

7-36      (c) If applicable, a copy of the letter of determination being

7-37  appealed, or if such a copy is unavailable, the date of the

7-38  determination and the issues stated in the determination.

7-39      3.  If a dispute is required to be submitted to a procedure for

7-40  resolving complaints pursuant to NRS 616C.305 and:

7-41      (a) A final determination was rendered pursuant to that

7-42  procedure; or

7-43      (b) The dispute was not resolved pursuant to that procedure

7-44  within 14 days after it was submitted,

8-1  any party to the dispute may file a notice of appeal within 70 days

8-2  after the date on which the final determination was mailed to the

8-3  employee, or his dependent, or the unanswered request for

8-4  resolution was submitted. Failure to render a written determination

8-5  within 30 days after receipt of such a request shall be deemed by the

8-6  appeals officer to be a denial of the request.

8-7  [3.] 4. Except as otherwise provided in NRS 616C.380, the

8-8  filing of a notice of appeal does not automatically stay the

8-9  enforcement of the decision of a hearing officer or a determination

8-10  rendered pursuant to NRS 616C.305. The appeals officer may order

8-11  a stay, when appropriate, upon the application of a party. If such an

8-12  application is submitted, the decision is automatically stayed until a

8-13  determination is made concerning the application. A determination

8-14  on the application must be made within 30 days after the filing of

8-15  the application. If a stay is not granted by the officer after reviewing

8-16  the application, the decision must be complied with within 10 days

8-17  after the date of the refusal to grant a stay.

8-18      [4.] 5. Except as otherwise provided in this subsection [,] and

8-19  subsection 2, the appeals officer shall, within 10 days after

8-20  receiving a notice of appeal pursuant to this section or a contested

8-21  claim pursuant to subsection [5] 6 of NRS 616C.315, schedule a

8-22  hearing on the merits of the appeal or contested claim for a date and

8-23  time within 90 days after his receipt of the notice and give notice by

8-24  mail or by personal service to all parties to the matter and their

8-25  attorneys or agents at least 30 days before the date and time

8-26  scheduled. A request to schedule the hearing for a date and time

8-27  which is:

8-28      (a) Within 60 days after the receipt of the notice of appeal or

8-29  contested claim; or

8-30      (b) More than 90 days after the receipt of the notice or

8-31  claim,

8-32  may be submitted to the appeals officer only if all parties to the

8-33  appeal or contested claim agree to the request.

8-34      [5.] 6. An appeal or contested claim may be continued upon

8-35  written stipulation of all parties, or upon good cause shown.

8-36      [6.] 7. Failure to file a notice of appeal within the period

8-37  specified in subsection 1 or [2] 3 may be excused if the party

8-38  aggrieved shows by a preponderance of the evidence that he did not

8-39  receive the notice of the determination and the forms necessary to

8-40  appeal the determination. The claimant, employer or insurer shall

8-41  notify the hearing officer of a change of address.

8-42      Sec. 10.  NRS 616C.360 is hereby amended to read as follows:

8-43      616C.360 1.  A stenographic or electronic record must be kept

8-44  of the hearing before the appeals officer and the rules of evidence

9-1  applicable to contested cases under chapter 233B of NRS apply to

9-2  the hearing.

9-3  2.  The appeals officer must hear any matter raised before him

9-4  on its merits, including new evidence bearing on the matter.

9-5  3.  If [necessary to resolve] there is a medical question or

9-6  dispute concerning an injured employee’s condition or [to

9-7  determine] concerning the necessity of treatment for which

9-8  authorization for payment has been denied, the medical question or

9-9  dispute is relevant to an issue involved in the matter before the

9-10  appeals officer and all parties agree to the submission of the

9-11  matter to an external review organization, the appeals officer [may

9-12  refer the employee to a physician or chiropractor of his choice who

9-13  has demonstrated special competence to treat the particular medical

9-14  condition of the employee. If the medical question concerns the

9-15  rating of a permanent disability, the appeals officer may refer the

9-16  employee to a rating physician or chiropractor. The rating physician

9-17  or chiropractor must be selected in rotation from the list of qualified

9-18  physicians or chiropractors maintained by the Administrator

9-19  pursuant to subsection 2 of NRS 616C.490, unless the insurer and

9-20  the injured employee otherwise agree to a rating physician or

9-21  chiropractor. The insurer shall pay the costs of any examination

9-22  requested by the appeals officer.] must submit the matter to an

9-23  external review organization in accordance with section 5 of this

9-24  act and the regulations adopted by the Commissioner.

9-25      4.  If an injured employee has requested payment for the cost of

9-26  obtaining a second determination of his percentage of disability

9-27  pursuant to NRS 616C.100, the appeals officer shall decide whether

9-28  the determination of the higher percentage of disability made

9-29  pursuant to NRS 616C.100 is appropriate and, if so, may order the

9-30  insurer to pay to the employee an amount equal to the maximum

9-31  allowable fee established by the Administrator pursuant to NRS

9-32  616C.260 for the type of service performed, or the usual fee of that

9-33  physician or chiropractor for such service, whichever is less.

9-34      5.  The appeals officer shall order an insurer, organization for

9-35  managed care or employer who provides accident benefits for

9-36  injured employees pursuant to NRS 616C.265 to pay the charges of

9-37  a provider of health care if the conditions of NRS 616C.138 are

9-38  satisfied.

9-39      6.  Any party to the appeal or the appeals officer may order a

9-40  transcript of the record of the hearing at any time before the seventh

9-41  day after the hearing. The transcript must be filed within 30 days

9-42  after the date of the order unless the appeals officer otherwise

9-43  orders.

9-44      7.  The appeals officer shall render his decision:

10-1      (a) If a transcript is ordered within 7 days after the hearing,

10-2  within 30 days after the transcript is filed; or

10-3      (b) If a transcript has not been ordered, within 30 days after the

10-4  date of the hearing.

10-5      8.  The appeals officer may affirm, modify or reverse any

10-6  decision made by the hearing officer and issue any necessary and

10-7  proper order to give effect to his decision.

10-8      Sec. 11.  Notwithstanding the amendatory provisions of this

10-9  act, an appeals officer shall not submit a matter for external review

10-10  pursuant to NRS 616C.360, as amended by this act, until the

10-11  Commissioner of Insurance has issued a certificate pursuant to

10-12  section 3 of this act to at least one external review organization that

10-13  is qualified to conduct an external review of the matter.

10-14     Sec. 12.  1.  This section and sections 7 and 9 of this act

10-15  become effective upon passage and approval.

10-16     2.  Sections 1 to 6, inclusive, 8, 10 and 11 of this act become

10-17  effective upon passage and approval for the purpose of adopting

10-18  regulations and on October 1, 2003, for all other purposes.

 

10-19  H