We hope this finds everyone well. 2021 looks to be an exciting year for workers’ compensation and Texas. We all continue to adapt to the changes brought about by the COVID-19 pandemic. The Texas Legislature has convened for the 87th Texas Legislative Session. The Division of Workers’ Compensation (DWC) continues to carry out its responsibilities, including adopting new rules and extending the COVID-19 data call. There was also a recent court case addressing an employer’s contractual liability to pay for health care associated with a workers’ compensation claim. As always, if we can answer any questions, please do not hesitate to contact us.
LEGISLATIVE UPDATE – THE LEGISLATURE IS BACK IN TOWN!
By Robert (Bob) Graves, Paul Gonzalez, Jheris Jordan, Travis Holland and Dennis L. Grebe
For the most part, the Texas Legislature only meets every two years. This is one of those years. On January 12, 2021, the Legislature convened for the 87th Texas Legislative Session. Given the unprecedented impact of the COVID-19 pandemic, it will be an interesting Session to follow. The Legislature’s agenda reflects three top priorities: the budget, redistricting, and the pandemic. However, there have been some Legislative initiatives involving workers’ compensation. The following is a summary of some of the bills affecting workers’ compensation that have been filed. As the Session progresses, there may be additional bills as, generally, bills may continue to be filed during first 60 days of the regular session. Keep in mind that, simply because a bill was filed, does mean there has been a change in the law. The Legislature must approve the bill and it must be signed by the Governor before it becomes part of the law.
PRESUMPTIONS AND COVID-19
The COVID-19 pandemic has spurred a number of bills creating legal presumptions that a disease was contracted in the course and scope of employment for specific types of workers. These bills include:
School District Employees
HB 47 (Author – Canales): Amends Government Code Section 607.054 to provide that an employee of a school district who is diagnosed with SARS-CoV-2 or with coronavirus disease 2019 (COVID-19) by a test approved by the CDC that results in death or total or partial disability is presumed to have contracted the disease in the course and scope of employment as an employee of a school district.
Nurses
HB 396 (Author – Moody): Adds Texas Labor Code Section 408.009, “Presumption of Compensability of Coronavirus Disease (COVID-19) for Nurses.” The bill provides that a nurse who suffers from COVID-19 on or after February 1, 2020, resulting in disability or death is presumed to have contacted the disease in the course and scope of employment as a nurse. “Nurse” is defined as person required to be licensed to engage in professional or vocational nursing, including nurses employed by state agency or political subdivision. The effective date of the bill is backdated to include nurses diagnosed after February 1, 2020. The bill also amends Texas Labor Code Sections 409.021(a-3) and §415.021(c-2) regarding timely disputes of claims and administrative penalties.
The bill’s amendments only apply if the nurse: (1) is assigned: (a) to treat a patient diagnosed with the disease; or (b) to duties that required the nurse to come in contact with a patient diagnosed with the disease; and (2) the nurse contracts the disease during the patient’s admission to the health care facility or within 14 days of discharge.
First Responders, including Detention Officers
HB 637 (Author – Canales): Amends Government Code Section 607 of the Government Code to provide a presumption for public safety employees who contract COVID-19 that the disease is work-related. Specifically precludes self-insureds or carriers from arguing any disease that is the basis for a disaster declaration from the Governor is an “ordinary disease of life”. The bill adds detention officer to the list of public safety employees who are afforded the presumption (firefighters, peace officers, and emergency medical technicians).
SB 107 (Author – Powell): Amends Texas Government Code Section 607.002 regarding certain claims for reimbursement for benefits, compensation, or assistance by certain public safety employees (PSE) who are exposed to a contagious disease if the disease it is not an ordinary disease of life. The bill provides that a disease is deemed not an ordinary disease of life if it is a basis for a disaster declared by the Governor.
Amends Government Code Chapter 607, regarding firefighters, peace officers and emergency medical technicians to include detention officers.
Creates Government Code Section 607.0545, providing that a detention officer, firefighter, peace officer or emergency medical technician who contracts a disease that is the basis for a disaster declaration for all or part of the state and dies or is totally or partially disabled as a result of the disease is presumed to have contracted the disease “during the course and scope of employment.”
Amends Government Code Section 615.021’s definition of personal injury to include a disease that is the basis for a disaster declared by the Governor for all or part the state.
Amends Government Code Section 615.0721 to provide that an individual who suffers a personal injury resulting from a disease that is the basis for a disaster declaration by the Governor for all or part of the state is presumed to have sustained the injury in the line of the individual’s position.
DEATH BENEFITS
HB 243 (Author – Meza): Amends Texas Labor Code Section 408.061 to provide a cost-of-living increase for workers’ compensation death benefits. The bill would apply to only compensable injuries after the effective date of the bill.
UNIVERSAL HEALTH CARE
HB 602 – (Author – Hinojosa): Amends Title 8 of the Texas Insurance Code by adding Chapter 1698, “Healthy Texas Program.” Creates a state-funded “comprehensive, universal single-payer program” for health care, with board members and advisory committee. The bill also mandates the board to, in two years, develop a proposal for a Healthy Texas Program to provide health care coverage for health care currently covered under the Texas workers’ compensation system, including whether and how to continue funding for those services and how to incorporate an element of experience rating.
MANDATORY WORKERS’ COMPENSATION COVERAGE FOR CONTRACTORS
HB 776 (Author – Walle): Amends Texas Labor Chapter 406 to require contractors and subcontractors to provide workers’ compensation insurance coverage for each of their employees. Also, mandates the general contractor will have to obtain a written certificate of workers’ compensation coverage from every subcontractor on a government job. The bill permits controlled insurance programs to ensure coverage of all individuals on job sites.
ODDS AND ENDS
The following is a summary of other bills that may impact workers’ compensation.
HB 458 (Author – Shaheen) Amends Section 101.011 of Family Code to include “earnings” from a transportation network (Uber, Lyft, etc.) for the purposes of child support.
HB 1032 (Author – Thierry): Relates to authorizing school districts to provide funding using money received under the Foundation School Program to community based organizations for purposes of reimbursing private employers for paid internships provided to certain students in career and technology education programs in the district. Requires an annual report that must include information on the number and percentage of trainees covered by health care or workers’ compensation.
SB 207 (Author – Schwertner, Buckingham, Campbell): Amends the Texas Civil Practice and Remedies Code regarding the recovery of medical or health care expenses in civil actions. The bill allows a party in an action in which a claimant seeks recovery of medical and health care expenses to introduce evidence of the reasonableness of the amount charged for medical or health care services provided to a claimant, including the amount paid, the amount that would have been paid, or the amount likely to be paid for the medical services provided to the claimant by workers’ compensation insurance.
BILLS SPECIFICALLY NOT APPLICABLE TO WORKERS’ COMPENSATION
There are a number of bills that explicitly do not apply to workers’ compensation. These include:
HB 247 (Author – Meza): Relating to employment leave for certain family or medical obligations. Provides that an employee is not eligible for such benefits with respect to any day for which the employee receives workers’ compensation benefits.
HB 293 (Author – Collier): Relating to health benefit coverage for certain fertility preservation services under certain health benefit plans. The bill specifically does not apply to workers’ compensation insurance policies.
HB 365 (Author – Murr): Relating to the limitation of liability for farm animal activities. The bill specifically notes that nothing in the bill alters the applicability of the provisions of Chapter 406 of the Texas Labor Code or an employer’s ability to refuse to subscribe to the worker’s compensation system.
HB 440 (Author – Johnson of Dallas): Amends Insurance Code Sections 1365.001 through 1365.004 regarding coverage of hearing aids for children and adults. The bill specifically indicates changes do not apply workers’ compensation insurance policies.
HB 508 (Author – Beckley): Creates Insurance Code Chapter 1509 regarding coverage of pre-existing conditions under a health benefit plan. The bill specifically indicates it does not apply to workers’ compensation insurance policies.
HB 843 (Author – Lopez): Amends Insurance Code Chapter 1367 relating to health benefit plan coverage for early childhood intervention services. The bill specifically indicates it does not apply to workers’ compensation insurance policies.
HB 907 (Author – Johnson of Dallas): Amends Insurance Code Chapter 1369 relating to prior authorization for prescription drug benefits related to the treatment of chronic and autoimmune diseases. The bill specifically indicates it does not apply to workers’ compensation insurance policies.
HB 908 (Author – Johnson of Dallas): —Amends Texas Insurance Code Chapter 1367 relating to health benefit plan coverage for early childhood intervention services. The bill specifically indicates it does not apply to workers’ compensation insurance policies.
SB 76 (Author – Miles): Limits cost-sharing requirements imposed by a health benefit plan for certain prescription insulin. The bill specifically indicates it does not apply to workers’ compensation insurance policies.
SB 93 (Author – Menendez): Addresses health benefit coverage for certain fertility preservation services under certain health benefit plans. The bill specifically indicates it does not apply to workers’ compensation insurance policies.
SB 120 (Author – Johnson): Relates to the creation of a health insurance risk pool for certain health benefit plan enrollees and authorizing an assessment. The bill specifically indicates it does not apply to workers’ compensation insurance policies.
CAN AN EMPLOYER BE CONTRACTUALLY LIABLE FOR MEDICAL BENEFITS? HAND & WRIST CENTER OF HOUSTON, P.A. v. LOWERY MASONRY, LLC
By Robert (Bob) Graves and Jheris Jordan
Occasionally, instances arise where an employer signs a contract with a health care provider guaranteeing payment in an effort to obtain prompt care for an injured employee. It is unclear whether such contracts are consistent with the Texas Workers’ Compensation Act. In Hand & Wrist Center of Houston, P.A. v Lowery Masonry, LLC, No. 14-19-00539-CV (December 22, 2020) the Houston Fourteenth Court of Appeals addressed such a contract. In the case, Lowery Masonry signed a “Letter of Guarantee” with Hand & Wrist Center of Houston (HWC) guaranteeing that Lowery Masonry would pay HWC’s usual and customary fees within 30 days after receiving notice. The Letter of Guarantee had exceptions, one of which provided HWC would not seek “additional payment” from Lowery Masonry if “the Company has workers’ compensation insurance with Texas Mutual Insurance Company.”
The trial court issued a summary judgement in favor of Lowery Masonry because Lowery Masonry had workers’ compensation coverage with Texas Mutual Insurance Company.
The Court of Appeals reversed the trial court’s judgment. The Court of Appeals focused on the agreement’s phrase “additional payment,” noting that the inclusion of this phrase contemplated that HWC would have received its usual and customary payment from another identified source. The Court of Appeals found that Lowery Masonry did not conclusively establish an unambiguous or definite legal meaning in the contract in its favor. Accordingly, the Court of Appeals remanded the case back to the trial court for further proceedings.
The Court of Appeals did not address whether such contracts are permissible under the Texas Workers’ Compensation Act or whether an employer who signs such a contract can be liable for additional reimbursement where a workers’ compensation carrier paid benefits pursuant the applicable medical fee guideline. However, based on the Court of Appeal’s decision, employers should be cautious about entering into such guarantee agreements.
DWC ADOPTS MEDICAL FEE DISPUTE RESOLUTION RULE AMENDMENTS
The DWC adopted amendments to its Rule 133.307 (28 Tex. Admin Code §133.307) allowing health care providers and pharmacy processing agents to electronically submit requests for medical fee dispute resolution. The new rule for electronic submissions will go into effect on February 22, 2021. The DWC will post a copy of the amended rule on its website at https://www.tdi.texas.gov/wc/rules/2020rules.html.
DWC EXTENDS COVID-19 DATA CALL – COMMISSIONER BULLETIN # B-0003-21
On June 2, 2020, the DWC issued a mandatory data call for certain information related to COVID-19 injuries reported to select insurance carriers on or after December 1, 2019. To ensure that the DWC has sufficient information to determine the impact of COVID-19 injuries on the Texas workers’ compensation system, DWC has extended the data call through June 2021. The DWC has reminded system participants:
- Only selected insurance carriers/groups are required to comply with the data call. Selected insurance carriers must provide summary data using the COVID-19 data call reporting forms and instructions. Each selected insurance carrier or group is required to provide one data submission per insurance carrier or group.
- Insurance carriers/groups must submit the requested data to DWC through the insurance carrier Austin representative’s secure file transfer protocol box no later than 5 p.m., Central time to be considered timely.
- Data call submissions are cumulative.
DWC ASKS FOR INPUT ON RULE REVIEW
The DWC is performing a routine review of all of its rules associated with Rule Chapters 140-144 (Dispute Resolution), 147-148 (Agreements, Settlements, Commutations and Hearings Conducted by the State Office of Administrative Hearings), 150 (Qualifications for Representatives), 152 (Attorney Fees), and 156 (Carriers’ Austin Representative). DWC is accepting public comments on whether the rules in these chapters still have reason to exist or should be repealed, readopted, or readopted with amendments. To comment on this rule review project, submit your written comments by 5 p.m., Central time, on February 16, 2021. You may email comments to RuleComments@tdi.texas.gov, or mail or deliver them to: Cynthia Guillen, Legal Services, MS-4D Texas Department of Insurance, Division of Workers’ Compensation, 7551 Metro Center Drive, Suite 100, Austin, Texas 78744-1645.