REPORT TITLE:
Insurance

DESCRIPTION:
Requires IMEs to be performed by a provider agreed to by the
parties in a workers' compensation or motor vehicle insurance
case, and establishes a $400 cap on IMEs in motor vehicle
insurance cases.  Standardizes references to the fee schedule in
the motor vehicle and workers' compensation laws.  (SD2)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        2476
HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 1
TWENTIETH LEGISLATURE, 2000                                S.D. 2
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO INSURANCE.



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

 1      SECTION 1.  Section 386-79, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "386-79  Medical examination by employer's physician.
 
 4 After an injury and during the period of disability, the
 
 5 employee, whenever ordered by the director of labor and
 
 6 industrial relations, shall submit to examination, at reasonable
 
 7 times and places, by a duly qualified physician or surgeon
 
 8 [designated and] paid by the employer[.] and selected by mutual
 
 9 agreement between the claimant and the employer; provided that if
 
10 no mutual agreement is reached, the director, pursuant to
 
11 section 386-80, shall appoint a duly qualified physician or
 
12 surgeon from a rotating list of duly qualified physicians and
 
13 surgeons established and maintained by the department.  The
 
14 employee shall have the right to have a physician or surgeon
 
15 designated and paid by the employee present at the examination,
 
16 which right, however, shall not be construed to deny to the
 
17 employer's physician the right to visit the injured employee at
 
18 all reasonable times and under all reasonable conditions during
 
19 total disability.
 

 
Page 2                                                     2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1      If an employee refuses to submit to, or in any way obstructs
 
 2 such examination, the employee's right to claim compensation for
 
 3 the work injury shall be suspended until the refusal or
 
 4 obstruction ceases and no compensation shall be payable for the
 
 5 period during which the refusal or obstruction continues.
 
 6      In cases where the employer is dissatisfied with the
 
 7 progress of the case or where major and elective surgery, or
 
 8 either, is contemplated, the employer may appoint a physician or
 
 9 surgeon of the employer's choice who shall examine the injured
 
10 employee and make a report to the employer.  If the employer
 
11 remains dissatisfied, this report may be forwarded to the
 
12 director.
 
13      Employer requested examinations under this section shall not
 
14 exceed more than one per case unless good and valid reasons exist
 
15 with regard to the medical progress of the employee's treatment.
 
16 The cost of conducting the ordered medical examination shall be
 
17 limited to the complex consultation charges governed by the
 
18 medical fee schedule established pursuant to section 386-21(c)."
 
19      SECTION 2.  Section 431:10C-304, Hawaii Revised Statutes, is
 
20 amended to read as follows:
 
21      "431:10C-304  Obligation to pay personal injury protection
 
22 benefits.  For purposes of this section, the term "personal
 
23 injury protection insurer" includes personal injury protection
 

 
Page 3                                                     2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1 self-insurers.  Every personal injury protection insurer shall
 
 2 provide personal injury protection benefits for accidental harm
 
 3 as follows:
 
 4      (1)  Except as otherwise provided in section 431:10C-305(d),
 
 5           in the case of injury arising out of a motor vehicle
 
 6           accident, the insurer shall pay, without regard to
 
 7           fault, to the provider of services on behalf of the
 
 8           following persons who sustain accidental harm as a
 
 9           result of the operation, maintenance, or use of the
 
10           vehicle, an amount equal to the personal injury
 
11           protection benefits as defined in section 431:10C-
 
12           103.5(a) payable for expenses to that person as a
 
13           result of the injury:
 
14           (A)  Any person, including the owner, operator,
 
15                occupant, or user of the insured motor vehicle;
 
16           (B)  Any pedestrian (including a bicyclist); or
 
17           (C)  Any user or operator of a moped as defined in
 
18                section 249-1;
 
19           provided that this paragraph shall not apply in the
 
20           case of injury to or death of any operator or passenger
 
21           of a motorcycle or motor scooter as defined in section
 
22           286-2 arising out of a motor vehicle accident, unless
 
23           expressly provided for in the motor vehicle policy;
 

 
Page 4                                                     2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1      (2)  Payment of personal injury protection benefits shall be
 
 2           made as the benefits accrue, except that in the case of
 
 3           death, payment of benefits under section 431:10C-
 
 4           302(a)(5) may be made immediately in a lump sum
 
 5           payment, at the option of the beneficiary;
 
 6      (3)  (A)  Payment of personal injury protection benefits
 
 7                shall be made within thirty days after the insurer
 
 8                has received reasonable proof of the fact and
 
 9                amount of benefits accrued, and demand for payment
 
10                thereof. All providers must produce descriptions
 
11                of the service provided in conformity with
 
12                applicable fee schedule codes;
 
13           (B)  If the insurer elects to deny a claim for benefits
 
14                in whole or in part, the insurer shall, within
 
15                thirty days, notify the claimant in writing of the
 
16                denial and the reasons for the denial.  The denial
 
17                notice shall be prepared and mailed by the insurer
 
18                in triplicate copies and be in a format approved
 
19                by the commissioner.  In the case of benefits for
 
20                services specified in section 431:10C-103.5(a) the
 
21                insurer shall also mail a copy of the denial to
 
22                the provider; and
 
23           (C)  If the insurer cannot pay or deny the claim for
 

 
Page 5                                                     2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1                benefits because additional information or loss
 
 2                documentation is needed, the insurer shall, within
 
 3                the thirty days, forward to the claimant an
 
 4                itemized list of all the required documents.  In
 
 5                the case of benefits for services specified in
 
 6                section 431:10C-103.5(a) the insurer shall also
 
 7                forward the list to the service provider;
 
 8      (4)  Amounts of benefits which are unpaid thirty days after
 
 9           the insurer has received reasonable proof of the fact
 
10           and the amount of benefits accrued, and demand for
 
11           payment thereof, after the expiration of the thirty
 
12           days, shall bear interest at the rate of one and one-
 
13           half per cent per month;
 
14      (5)  No part of personal injury protection benefits paid
 
15           shall be applied in any manner as attorney's fees in
 
16           the case of injury or death for which the benefits are
 
17           paid.  The insurer shall pay, subject to section
 
18           431:10C-211, in addition to the personal injury
 
19           protection benefits due, all attorney's fees and costs
 
20           of settlement or suit necessary to effect the payment
 
21           of any or all personal injury protection benefits found
 
22           due under the contract.  Any contract in violation of
 
23           this provision shall be illegal and unenforceable.  It
 

 
Page 6                                                     2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1           shall constitute an unlawful and unethical act for any
 
 2           attorney to solicit, enter into, or knowingly accept
 
 3           benefits under any contract; [and
 
 4      (6)  Any insurer who violates this section shall be subject
 
 5           to section 431:10C-117(b) and (c).]
 
 6      (6)  Disputes between the provider and the insurer over the
 
 7           amount of a charge or the correct fee or procedure code
 
 8           to be used under the workers' compensation supplemental
 
 9           medical fee schedule shall be governed by section
 
10           431:10C-308.5; and
 
11      (7)  Any insurer who violates this section shall be subject
 
12           to section 431:10C-117(b) and (c)."
 
13      SECTION 3.  Section 431:10C-308.5, Hawaii Revised Statutes,
 
14 is amended to read as follows:
 
15      "431:10C-308.5  Limitation on charges.  (a)  As used in
 
16 this article, the term ["workers' compensation schedules"]
 
17 "workers' compensation supplemental medical fee schedule" means
 
18 the [schedules] schedule adopted and as may be amended by the
 
19 director of labor and industrial relations for workers'
 
20 compensation cases under chapter 386, establishing fees and
 
21 frequency of treatment guidelines[, and contained in sections 12-
 
22 13-30, 12-13-35, 12-13-38, 12-13-39, 12-13-45, 12-13-85 through
 
23 92, and 12-13-94, Hawaii administrative rules].  References in
 

 
Page 7                                                     2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1 the workers' compensation [schedules] supplemental medical fee
 
 2 schedule to "the employer", "the director", and "the industrial
 
 3 injury", shall be respectively construed as references to "the
 
 4 insurer", "the commissioner", and "the injury covered by personal
 
 5 injury protection benefits" for purposes of this article.
 
 6      (b)  The charges and frequency of treatment for services
 
 7 specified in section 431:10C-103.5(a), except for emergency
 
 8 services provided within seventy-two hours following a motor
 
 9 vehicle accident resulting in injury, shall not exceed the
 
10 charges and frequency of treatment permissible under the workers'
 
11 compensation [schedules.] supplemental medical fee schedule.
 
12 Charges for independent medical examinations, including record
 
13 reviews, physical examinations, history taking, and reports, to
 
14 be conducted by a licensed Hawaii provider unless the insured
 
15 consents to an out-of-state provider, shall not exceed [the
 
16 charges permissible under the workers' compensation schedules for
 
17 consultation for a complex medical problem.] a maximum of $400
 
18 based on the appropriate codes in the workers' compensation
 
19 supplemental fee schedule for complex consultation pursuant to
 
20 section 386-79.  The workers' compensation [schedules]
 
21 supplemental medical fee schedule shall not apply to independent
 
22 medical examinations conducted by out-of-state providers[;
 
23 provided that] if the charges for the examination are reasonable.
 

 
Page 8                                                     2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1 All records and charges relating to an independent medical
 
 2 examination shall be made available to the claimant upon request.
 
 3 The commissioner may adopt administrative rules relating to fees
 
 4 or frequency of treatment for injuries covered by personal injury
 
 5 protection benefits.  If adopted, these administrative rules
 
 6 shall prevail to the extent that they are inconsistent with the
 
 7 workers' compensation [schedules.] supplemental medical fee
 
 8 schedule.
 
 9      The provider conducting the independent medical examination
 
10 shall be selected by mutual agreement between the claimant and
 
11 the insurer; provided that if no mutual agreement is reached, the
 
12 commissioner shall appoint a duly qualified provider from a
 
13 rotating list of duly qualified providers established and
 
14 maintained by the insurance division.
 
15      (c)  Charges for services for which no fee is set by the
 
16 workers' compensation [schedules] supplemental medical fee
 
17 schedule or other administrative rules adopted by the
 
18 commissioner shall be limited to eighty per cent of the
 
19 provider's usual and customary charges for these services.
 
20      (d)  Services for which no frequency of treatment guidelines
 
21 are set forth in the workers' compensation [schedules]
 
22 supplemental medical fee schedule or other administrative rules
 
23 adopted by the commissioner shall be deemed appropriate and
 

 
Page 9                                                     2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1 reasonable expenses necessarily incurred if so determined by a
 
 2 provider.
 
 3      (e)  In the event of a dispute between the provider and the
 
 4 insurer over the amount of a charge or the correct fee or
 
 5 procedure code to be used under the workers' compensation
 
 6 supplemental medical fee schedule, the insurer shall:
 
 7      (1)  Pay all undisputed charges within thirty days after the
 
 8           insurer has received reasonable proof of the fact and
 
 9           amount of benefits accrued and demand for payment
 
10           thereof; and
 
11      (2)  Negotiate in good faith with the provider on the
 
12           disputed charges for a period up to sixty days after
 
13           the insurer has received reasonable proof of the fact
 
14           and amount of benefits accrued and demand for payment
 
15           thereof.
 
16 If the provider and the insurer are unable to resolve the
 
17 dispute, the provider, insurer, or claimant may submit the
 
18 dispute to the commissioner, arbitration, or court of competent
 
19 jurisdiction.  The parties shall include documentation of the
 
20 efforts of the insurer and the provider to reach a negotiated
 
21 resolution of the dispute.
 
22      [(e)] (f)  The provider of services described in section
 
23 431:10C-103.5(a) shall not bill the insured directly for those
 

 
Page 10                                                    2476
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1 services but shall bill the insurer for a determination of the
 
 2 amount payable.  The provider shall not bill or otherwise attempt
 
 3 to collect from the insured the difference between the provider's
 
 4 full charge and the amount paid by the insurer.
 
 5      [(f)] (g)  A health care provider shall be compensated by
 
 6 the insurer for preparing reports documenting the need for
 
 7 treatments which exceed the [schedules] workers' compensation
 
 8 supplemental medical fee schedule in accordance with the fee
 
 9 schedule for special reports.  The health care provider may
 
10 assess the cost of preparing a report to the insurer at no more
 
11 than $20 per page up to a maximum of $75 for each report."
 
12      SECTION 4.  Statutory material to be repealed is bracketed.
 
13 New statutory material is underscored.
 
14      SECTION 5.  This Act shall take effect upon its approval.