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; authorizing the establishment of 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 617,

1-7  inclusive, of NRS.

1-8  Sec. 3.  1.  The Commissioner may issue certificates

1-9  authorizing qualified external review organizations to conduct

1-10  external reviews for the purposes of chapters 616A to 617,

1-11  inclusive, of NRS. If the Commissioner issues such certificates

2-1  and the Commissioner determines that an external review

2-2  organization is qualified to conduct external reviews for the

2-3  purposes of chapters 616A to 617, inclusive, of NRS, the

2-4  Commissioner shall issue a certificate to the external review

2-5  organization that authorizes the organization to conduct such

2-6  external reviews in accordance with the provisions of section 5 of

2-7  this act and the regulations adopted by the Commissioner.

2-8  2.  The Commissioner may adopt regulations setting forth the

2-9  procedures that an external review organization must follow to be

2-10  issued a certificate to conduct external reviews. Any regulations

2-11  adopted pursuant to this section must include, without limitation,

2-12  provisions setting forth:

2-13      (a) The manner in which an external review organization may

2-14  apply for a certificate and the requirements for the issuance and

2-15  renewal of the certificate pursuant to this section;

2-16      (b) The grounds for which the Commissioner may refuse to

2-17  issue, suspend, revoke or refuse to renew a certificate issued

2-18  pursuant to this section;

2-19      (c) The manner and circumstances under which an external

2-20  review organization is required to conduct its business; and

2-21      (d) A fee for issuing or renewing a certificate of an external

2-22  review organization pursuant to this section. The fee must not

2-23  exceed the cost of issuing or renewing the certificate.

2-24      3.  A certificate issued pursuant to this section expires 1 year

2-25  after it is issued and may be renewed in accordance with

2-26  regulations adopted by the Commissioner.

2-27      4.  Before the Commissioner may issue a certificate to an

2-28  external review organization, the external review organization

2-29  must:

2-30      (a) Demonstrate to the satisfaction of the Commissioner that it

2-31  is able to carry out, in a timely manner, the duties of an external

2-32  review organization as set forth in section 5 of this act and the

2-33  regulations adopted by the Commissioner. The demonstration

2-34  must include, without limitation, proof that the external review

2-35  organization employs, contracts with or otherwise retains only

2-36  persons who are qualified because of their education, training,

2-37  professional licensing and experience to perform the duties

2-38  assigned to those persons; and

2-39      (b) Provide assurances satisfactory to the Commissioner that

2-40  the external review organization will:

2-41          (1) Conduct external reviews in accordance with the

2-42  provisions of section 5 of this act and the regulations adopted by

2-43  the Commissioner;

2-44          (2) Render its decisions in a clear, consistent, thorough and

2-45  timely manner; and

3-1       (3) Avoid conflicts of interest.

3-2  5.  For the purposes of this section, an external review

3-3  organization has a conflict of interest if the external review

3-4  organization or any employee, agent or contractor of the external

3-5  review organization who conducts an external review has a

3-6  professional, familial or financial interest of a material nature

3-7  with respect to any person who has a substantial interest in the

3-8  outcome of the external review, including, without limitation:

3-9  (a) The claimant;

3-10      (b) The employer; or

3-11      (c) The insurer or any officer, director or management

3-12  employee of the insurer.

3-13      6.  The Commissioner shall not issue a certificate to an

3-14  external review organization that is affiliated with:

3-15      (a) An organization for managed care which provides

3-16  comprehensive medical and health care services to employees for

3-17  injuries or diseases pursuant to chapters 616A to 617, inclusive, of

3-18  NRS;

3-19      (b) An insurer;

3-20      (c) A third-party administrator; or

3-21      (d) A national, state or local trade association.

3-22      7.  An external review organization which is certified or

3-23  accredited by an accrediting body that is nationally recognized

3-24  shall be deemed to have satisfied all the conditions and

3-25  qualifications required for the external review organization to be

3-26  issued a certificate pursuant to this section.

3-27      Sec. 4.  NRS 616A.025 is hereby amended to read as follows:

3-28      616A.025  As used in chapters 616A to 616D, inclusive, of

3-29  NRS, unless the context otherwise requires, the words and terms

3-30  defined in NRS 616A.030 to 616A.360, inclusive, and section 2 of

3-31  this act have the meanings ascribed to them in those sections.

3-32      Sec. 5.  Chapter 616C of NRS is hereby amended by adding

3-33  thereto a new section to read as follows:

3-34      1.  Not later than 5 business days after the date that an

3-35  external review organization receives a request for an external

3-36  review, the external review organization shall:

3-37      (a) Review the documents and materials submitted for the

3-38  external review; and

3-39      (b) Notify the injured employee, his employer and the insurer

3-40  whether the external review organization needs any additional

3-41  information to conduct the external review.

3-42      2.  The external review organization shall render a decision

3-43  on the matter not later than 15 business days after the date that it

3-44  receives all information that is necessary to conduct the external

3-45  review.

4-1  3.  In conducting the external review, the external review

4-2  organization shall consider, without limitation:

4-3  (a) The medical records of the insured;

4-4  (b) Any recommendations of the physician of the insured; and

4-5  (c) Any other information approved by the Commissioner for

4-6  consideration by an external review organization.

4-7  4.  In its decision, the external review organization shall

4-8  specify the reasons for its decision. The external review

4-9  organization shall submit a copy of its decision to:

4-10      (a) The injured employee;

4-11      (b) The employer;

4-12      (c) The insurer; and

4-13      (d) The appeals officer, if any.

4-14      5.  The insurer shall pay the costs of the services provided by

4-15  the external review organization.

4-16      6.  The Commissioner may adopt regulations to govern the

4-17  process of external review and to carry out the provisions of this

4-18  section. Any regulations adopted pursuant to this section must

4-19  provide that:

4-20      (a) All parties must agree to the submission of a matter to an

4-21  external review organization before a request for external review

4-22  may be submitted;

4-23      (b) A party may not be ordered to submit a matter to an

4-24  external review organization; and

4-25      (c) The findings and decisions of an external review

4-26  organization are not binding.

4-27      Sec. 6.  NRS 616C.245 is hereby amended to read as follows:

4-28      616C.245  1.  Every injured employee within the provisions of

4-29  chapters 616A to 616D, inclusive, of NRS is entitled to receive

4-30  promptly such accident benefits as may reasonably be required at

4-31  the time of the injury and within 6 months thereafter. Such benefits

4-32  may be further extended for additional periods as may be required.

4-33      2.  An injured employee is entitled to receive as an accident

4-34  benefit a motor vehicle that is modified to allow the employee to

4-35  operate the vehicle safely if:

4-36      (a) As a result of an injury arising out of and in the course of his

4-37  employment, he is quadriplegic, paraplegic or has had a part of his

4-38  body amputated; and

4-39      (b) He cannot be fitted with a prosthetic device which allows

4-40  him to operate a motor vehicle safely.

4-41      3.  If an injured employee is entitled to receive a motor vehicle

4-42  pursuant to subsection 2, a motor vehicle must be modified to allow

4-43  the employee to operate it safely in the following order of

4-44  preference:

5-1  (a) A motor vehicle owned by the injured employee must be so

5-2  modified if the insurer or employer providing accident benefits

5-3  determines that it is reasonably feasible to do so.

5-4  (b) A used motor vehicle must be so modified if the insurer or

5-5  employer providing accident benefits determines that it is

5-6  reasonably feasible to do so.

5-7  (c) A new motor vehicle must be so modified.

5-8  4.  The Administrator shall adopt regulations establishing a

5-9  maximum benefit to be paid under the provisions of this section.

5-10      Sec. 7.  NRS 616C.315 is hereby amended to read as follows:

5-11      616C.315  1.  Any person who is subject to the jurisdiction of

5-12  the hearing officers pursuant to chapters 616A to 616D, inclusive, or

5-13  chapter 617 of NRS may request a hearing before a hearing officer

5-14  of any matter within the hearing officer’s authority. The insurer

5-15  shall provide, without cost, the forms necessary to request a hearing

5-16  to any person who requests them.

5-17      2.  A hearing must not be scheduled until the following

5-18  information is provided to the hearing officer:

5-19      (a) The name of:

5-20          (1) The claimant;

5-21          (2) The employer; and

5-22          (3) The insurer or third-party administrator;

5-23      (b) The number of the claim; and

5-24      (c) If applicable, a copy of the letter of determination being

5-25  appealed, or if such a copy is unavailable, the date of the

5-26  determination and the issues stated in the determination.

5-27      3.  Except as otherwise provided in NRS 616B.772, 616B.775,

5-28  616B.787 and 616C.305, a person who is aggrieved by:

5-29      (a) A written determination of an insurer; or

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

5-31  written request mailed to the insurer by the person who is

5-32  aggrieved,

5-33  may appeal from the determination or failure to respond by filing a

5-34  request for a hearing before a hearing officer. Such a request must

5-35  include the information required pursuant to subsection 2 and

5-36  must be filed within 70 days after the date on which the notice of

5-37  the insurer’s determination was mailed by the insurer or the

5-38  unanswered written request was mailed to the insurer, as applicable.

5-39  The failure of an insurer to respond to a written request for a

5-40  determination within 30 days after receipt of such a request shall be

5-41  deemed by the hearing officer to be a denial of the request.

5-42      [3.] 4.  Failure to file a request for a hearing within the period

5-43  specified in subsection [2] 3 may be excused if the person aggrieved

5-44  shows by a preponderance of the evidence that he did not receive

5-45  the notice of the determination and the forms necessary to request a

6-1  hearing. The claimant or employer shall notify the insurer of a

6-2  change of address.

6-3  [4.] 5.  The hearing before the hearing officer must be

6-4  conducted as expeditiously and informally as is practicable.

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

6-6  represented by legal counsel, agree to forego a hearing before a

6-7  hearing officer and submit the contested claim directly to an appeals

6-8  officer.

6-9  Sec. 8.  NRS 616C.330 is hereby amended to read as follows:

6-10      616C.330 1.  The hearing officer shall:

6-11      (a) [Within] Except as otherwise provided in subsection 2 of

6-12  NRS 616C.315, within 5 days after receiving a request for a

6-13  hearing, set the hearing for a date and time within 30 days after his

6-14  receipt of the request;

6-15      (b) Give notice by mail or by personal service to all interested

6-16  parties to the hearing at least 15 days before the date and time

6-17  scheduled; and

6-18      (c) Conduct hearings expeditiously and informally.

6-19      2.  The notice must include a statement that the injured

6-20  employee may be represented by a private attorney or seek

6-21  assistance and advice from the Nevada Attorney for Injured

6-22  Workers.

6-23      3.  If necessary to resolve a medical question concerning an

6-24  injured employee’s condition or to determine the necessity of

6-25  treatment for which authorization for payment has been denied, the

6-26  hearing officer may refer the employee to a physician or

6-27  chiropractor of his choice who has demonstrated special competence

6-28  to treat the particular medical condition of the employee. If the

6-29  medical question concerns the rating of a permanent disability, the

6-30  hearing officer may refer the employee to a rating physician or

6-31  chiropractor. The rating physician or chiropractor must be selected

6-32  in rotation from the list of qualified physicians and chiropractors

6-33  maintained by the Administrator pursuant to subsection 2 of NRS

6-34  616C.490, unless the insurer and injured employee otherwise agree

6-35  to a rating physician or chiropractor. The insurer shall pay the costs

6-36  of any medical examination requested by the hearing officer.

6-37      4.  If an injured employee has requested payment for the cost of

6-38  obtaining a second determination of his percentage of disability

6-39  pursuant to NRS 616C.100, the hearing officer shall decide whether

6-40  the determination of the higher percentage of disability made

6-41  pursuant to NRS 616C.100 is appropriate and, if so, may order the

6-42  insurer to pay to the employee an amount equal to the maximum

6-43  allowable fee established by the Administrator pursuant to NRS

6-44  616C.260 for the type of service performed, or the usual fee of that

6-45  physician or chiropractor for such service, whichever is less.

7-1  5.  The hearing officer shall order an insurer, organization for

7-2  managed care or employer who provides accident benefits for

7-3  injured employees pursuant to NRS 616C.265 to pay the charges of

7-4  a provider of health care if the conditions of NRS 616C.138 are

7-5  satisfied.

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

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

7-8  7.  The hearing officer shall render his decision within 15 days

7-9  after:

7-10      (a) The hearing; or

7-11      (b) He receives a copy of the report from the medical

7-12  examination he requested.

7-13      8.  The hearing officer shall render his decision in the most

7-14  efficient format developed by the Chief of the Hearings Division of

7-15  the Department of Administration.

7-16      9.  The hearing officer shall give notice of his decision to each

7-17  party by mail. He shall include with the notice of his decision the

7-18  necessary forms for appealing from the decision.

7-19      10.  Except as otherwise provided in NRS 616C.380, the

7-20  decision of the hearing officer is not stayed if an appeal from that

7-21  decision is taken unless an application for a stay is submitted by a

7-22  party. If such an application is submitted, the decision is

7-23  automatically stayed until a determination is made on the

7-24  application. A determination on the application must be made within

7-25  30 days after the filing of the application. If, after reviewing the

7-26  application, a stay is not granted by the hearing officer or an appeals

7-27  officer, the decision must be complied with within 10 days after the

7-28  refusal to grant a stay.

7-29      Sec. 9.  NRS 616C.345 is hereby amended to read as follows:

7-30      616C.345  1.  Any party aggrieved by a decision of the

7-31  hearing officer relating to a claim for compensation may appeal

7-32  from the decision by filing a notice of appeal with an appeals officer

7-33  within 30 days after the date of the decision.

7-34      2.  A hearing must not be scheduled until the following

7-35  information is provided to the appeals officer:

7-36      (a) The name of:

7-37          (1) The claimant;

7-38          (2) The employer; and

7-39          (3) The insurer or third-party administrator;

7-40      (b) The number of the claim; and

7-41      (c) If applicable, a copy of the letter of determination being

7-42  appealed, or if such a copy is unavailable, the date of the

7-43  determination and the issues stated in the determination.

7-44      3.  If a dispute is required to be submitted to a procedure for

7-45  resolving complaints pursuant to NRS 616C.305 and:

8-1  (a) A final determination was rendered pursuant to that

8-2  procedure; or

8-3  (b) The dispute was not resolved pursuant to that procedure

8-4  within 14 days after it was submitted,

8-5  any party to the dispute may file a notice of appeal within 70 days

8-6  after the date on which the final determination was mailed to the

8-7  employee, or his dependent, or the unanswered request for

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

8-9  within 30 days after receipt of such a request shall be deemed by the

8-10  appeals officer to be a denial of the request.

8-11      [3.] 4. Except as otherwise provided in NRS 616C.380, the

8-12  filing of a notice of appeal does not automatically stay the

8-13  enforcement of the decision of a hearing officer or a determination

8-14  rendered pursuant to NRS 616C.305. The appeals officer may order

8-15  a stay, when appropriate, upon the application of a party. If such an

8-16  application is submitted, the decision is automatically stayed until a

8-17  determination is made concerning the application. A determination

8-18  on the application must be made within 30 days after the filing of

8-19  the application. If a stay is not granted by the officer after reviewing

8-20  the application, the decision must be complied with within 10 days

8-21  after the date of the refusal to grant a stay.

8-22      [4.] 5. Except as otherwise provided in this subsection [,] and

8-23  subsection 2, the appeals officer shall, within 10 days after

8-24  receiving a notice of appeal pursuant to this section or a contested

8-25  claim pursuant to subsection [5] 6 of NRS 616C.315, schedule a

8-26  hearing on the merits of the appeal or contested claim for a date and

8-27  time within 90 days after his receipt of the notice and give notice by

8-28  mail or by personal service to all parties to the matter and their

8-29  attorneys or agents at least 30 days before the date and time

8-30  scheduled. A request to schedule the hearing for a date and time

8-31  which is:

8-32      (a) Within 60 days after the receipt of the notice of appeal or

8-33  contested claim; or

8-34      (b) More than 90 days after the receipt of the notice or

8-35  claim,

8-36  may be submitted to the appeals officer only if all parties to the

8-37  appeal or contested claim agree to the request.

8-38      [5.] 6. An appeal or contested claim may be continued upon

8-39  written stipulation of all parties, or upon good cause shown.

8-40      [6.] 7. Failure to file a notice of appeal within the period

8-41  specified in subsection 1 or [2] 3 may be excused if the party

8-42  aggrieved shows by a preponderance of the evidence that he did not

8-43  receive the notice of the determination and the forms necessary to

8-44  appeal the determination. The claimant, employer or insurer shall

8-45  notify the hearing officer of a change of address.

9-1  Sec. 10.  NRS 616C.360 is hereby amended to read as follows:

9-2  616C.360 1.  A stenographic or electronic record must be kept

9-3  of the hearing before the appeals officer and the rules of evidence

9-4  applicable to contested cases under chapter 233B of NRS apply to

9-5  the hearing.

9-6  2.  The appeals officer must hear any matter raised before him

9-7  on its merits, including new evidence bearing on the matter.

9-8  3.  If [necessary to resolve] there is a medical question or

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

9-10  determine] concerning the necessity of treatment for which

9-11  authorization for payment has been denied, the appeals officer may

9-12  [refer] :

9-13      (a) Refer the employee to a physician or chiropractor of his

9-14  choice who has demonstrated special competence to treat the

9-15  particular medical condition of the employee. If the medical

9-16  question concerns the rating of a permanent disability, the appeals

9-17  officer may refer the employee to a rating physician or chiropractor.

9-18  The rating physician or chiropractor must be selected in rotation

9-19  from the list of qualified physicians or chiropractors maintained by

9-20  the Administrator pursuant to subsection 2 of NRS 616C.490, unless

9-21  the insurer and the injured employee otherwise agree to a rating

9-22  physician or chiropractor. The insurer shall pay the costs of any

9-23  examination requested by the appeals officer.

9-24      (b) If the medical question or dispute is relevant to an issue

9-25  involved in the matter before the appeals officer and all parties

9-26  agree to the submission of the matter to an external review

9-27  organization, submit the matter to an external review organization

9-28  in accordance with section 5 of this act and any regulations

9-29  adopted by the Commissioner.

9-30      4.  If an injured employee has requested payment for the cost of

9-31  obtaining a second determination of his percentage of disability

9-32  pursuant to NRS 616C.100, the appeals officer shall decide whether

9-33  the determination of the higher percentage of disability made

9-34  pursuant to NRS 616C.100 is appropriate and, if so, may order the

9-35  insurer to pay to the employee an amount equal to the maximum

9-36  allowable fee established by the Administrator pursuant to NRS

9-37  616C.260 for the type of service performed, or the usual fee of that

9-38  physician or chiropractor for such service, whichever is less.

9-39      5.  The appeals officer shall order an insurer, organization for

9-40  managed care or employer who provides accident benefits for

9-41  injured employees pursuant to NRS 616C.265 to pay the charges of

9-42  a provider of health care if the conditions of NRS 616C.138 are

9-43  satisfied.

9-44      6.  Any party to the appeal or the appeals officer may order a

9-45  transcript of the record of the hearing at any time before the seventh

10-1  day after the hearing. The transcript must be filed within 30 days

10-2  after the date of the order unless the appeals officer otherwise

10-3  orders.

10-4      7.  The appeals officer shall render his decision:

10-5      (a) If a transcript is ordered within 7 days after the hearing,

10-6  within 30 days after the transcript is filed; or

10-7      (b) If a transcript has not been ordered, within 30 days after the

10-8  date of the hearing.

10-9      8.  The appeals officer may affirm, modify or reverse any

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

10-11  proper order to give effect to his decision.

10-12     Sec. 11.  Notwithstanding the amendatory provisions of this

10-13  act, an appeals officer shall not submit a matter for external review

10-14  pursuant to NRS 616C.360, as amended by this act, until the

10-15  Commissioner of Insurance has issued a certificate pursuant to

10-16  section 3 of this act to at least one external review organization that

10-17  is qualified to conduct an external review of the matter.

10-18     Sec. 12.  1.  This section and sections 7 and 9 of this act

10-19  become effective upon passage and approval.

10-20     2.  Sections 1 to 6, inclusive, 8, 10 and 11 of this act become

10-21  effective upon passage and approval for the purpose of adopting

10-22  regulations and on October 1, 2003, for all other purposes.

 

10-23  H