HB 2475--
Session of 1997
By Committee on Appropriations

9 AN ACT concerning workers compensation; relating to employee choice 10 of medical treatment; amending K.S.A. 1996 Supp. 44-510 and re- 11 pealing the existing section. 12 13 Be it enacted by the Legislature of the State of Kansas: 14 Section 1. K.S.A. 1996 Supp. 44-510 is hereby amended to read as 15 follows: 44-510. Except as otherwise provided therein, medical compen- 16 sation under the workers compensation act shall be as follows: 17 (a) It shall be the duty of the employer to provide the services of a 18 health care provider, and such medical, surgical and hospital treatment, 19 including nursing, medicines, medical and surgical supplies, ambulance, 20 crutches, and apparatus, and transportation to and from the home of the 21 injured employee to a place outside the community in which such em- 22 ployee resides, and within such community if the director in the director's 23 discretion so orders, including transportation expenses computed in ac- 24 cordance with subsection (a) of K.S.A. 44-515 and amendments thereto, 25 as may be reasonably necessary to cure and relieve the employee from 26 the effects of the injury. 27 However, the employee shall have the right to choose the initial health 28 care provider to provide medical compensation benefits on the employee's 29 behalf. If the services provided by the health care provider initially chosen 30 by the employee are unsatisfactory to the employee, the employee shall 31 be entitled to health care services provided by a health care provider of 32 the employer's choice. 33 (1) The director shall appoint, subject to the approval of the secretary, 34 a specialist in health services delivery, who shall be referred to as the 35 medical administrator. The medical administrator shall be a person li- 36 censed to practice medicine and surgery in this state and shall be in the 37 unclassified service under the Kansas civil service act. The medical ad- 38 ministrator, subject to the direction of the director, shall have the duty 39 of overseeing the providing of health care services to employees in ac- 40 cordance with the provisions of the workers compensation act, including 41 but not limited to: 42 (A) Preparing, with the assistance of the advisory panel, the fee 43 schedule for health care services as set forth in this section; HB 2475

 1    (B)  developing, with the assistance of the advisory panel, the utili-
 2  zation review program for health care services as set forth in this section;
 3    (C)  developing procedures for appeals and review of disputed
 4  charges or services rendered by health care providers under this section;
 5    (D)  developing a system for collecting and analyzing data on expend-
 6  itures for health care services by each type of provider under the workers
 7  compensation act; and
 8    (E)  carrying out such other duties as may be delegated or directed
 9  by the director or secretary.
10    (2)  The director shall prepare and adopt rules and regulations, which
11  shall be in effect on or before July 1, 1993, and which establish a schedule
12  of maximum fees for medical, surgical, hospital, dental, nursing, voca-
13  tional rehabilitation or any other treatment or services provided or or-
14  dered by health care providers and rendered to employees under the
15  workers compensation act. The schedule shall include provisions and re-
16  view procedures for exceptional cases involving extraordinary medical
17  procedures or circumstances and shall include costs and charges for med-
18  ical records and testimony.
19    (3)  The schedule of maximum fees shall be reasonable, shall promote
20  health care cost containment and efficiency with respect to the workers
21  compensation health care delivery system, and shall be sufficient to en-
22  sure availability of such reasonably necessary treatment, care and atten-
23  dance to each injured employee to cure and relieve the employee from
24  the effects of the injury.
25    (4) (A)  In every case, all fees, transportation costs, charges under this
26  section and all costs and charges for medical records and testimony shall
27  be subject to approval by the director and shall be limited to such as are
28  fair, reasonable and necessary. The schedule of maximum fees shall be
29  reviewed annually by the director to assure that the schedule is current,
30  reasonable and fair.
31    (B)  There is hereby created an advisory panel to assist the director
32  in establishing a schedule of maximum fees as required by this section.
33  The panel shall consist of the commissioner of insurance and seven mem-
34  bers appointed as follows:  (i) One person shall be appointed by the Kansas
35  medical society, (ii) one member shall be appointed by the Kansas asso-
36  ciation of osteopathic medicine, (iii) one member shall be appointed by
37  the Kansas hospital association, (iv) one member shall be appointed by
38  the Kansas chiropractic association, and (v) three members appointed by
39  the secretary. One member appointed by the secretary shall be a repre-
40  sentative of employers recommended to the secretary by the Kansas
41  chamber of commerce and industry. One member appointed by the sec-
42  retary shall be a representative of employees recommended to the sec-
43  retary by the Kansas AFL-CIO. One member appointed by the secretary
HB 2475

 1  shall be a representative of entities providing vocational rehabilitation
 2  services pursuant to K.S.A. 44-510g and amendments thereto. Each ap-
 3  pointed member shall be appointed for a term of office of two years which
 4  shall commence on July 1 of the year of appointment.
 5    (C)  All fees and other charges paid for such treatment, care and at-
 6  tendance, including treatment, care and attendance provided by any
 7  health care provider, hospital or other entity providing health care serv-
 8  ices, shall not exceed the amounts prescribed by the schedule of maxi-
 9  mum fees established under this section or the amounts authorized pur-
10  suant to the provisions and review procedures prescribed by the schedule
11  for exceptional cases. A health care provider, hospital or other entity pro-
12  viding health care services shall be paid either such health care provider,
13  hospital or other entity's usual charge for the treatment, care and atten-
14  dance or the maximum fees as set forth in the schedule, whichever is less.
15  In reviewing and approving the schedule of maximum fees, the director
16  shall consider the following:
17    (i)  The levels of fees for similar treatment, care and attendance im-
18  posed by other health care programs or third-party payors in the locality
19  in which such treatment or services are rendered;
20    (ii)  the impact upon cost to employers for providing a level of fees
21  for treatment, care and attendance which will ensure the availability of
22  treatment, care and attendance required for injured employees;
23    (iii)  the potential change in workers compensation insurance premi-
24  ums or costs attributable to the level of treatment, care and attendance
25  provided; and
26    (iv)  the financial impact of the schedule of maximum fees upon health
27  care providers and health care facilities and its effect upon their ability
28  to make available to employees such reasonably necessary treatment, care
29  and attendance to each injured employee to cure and relieve the em-
30  ployee from the effects of the injury.
31    (D)  Members of the advisory panel attending meetings of the advi-
32  sory panel, or attending a subcommittee of the advisory panel authorized
33  by the advisory panel, shall be paid subsistence allowances, mileage and
34  other expenses as provided in K.S.A. 75-3223 and amendments thereto.
35    (5)  Any contract or any billing or charge which any health care pro-
36  vider, vocational rehabilitation service provider, hospital, person, or in-
37  stitution enters into with or makes to any patient for services rendered in
38  connection with injuries covered by the workers compensation act or the
39  fee schedule adopted under this section, which is or may be in excess of
40  or not in accordance with such act or fee schedule, is unlawful, void and
41  unenforceable as a debt.
42    (6)  The director shall have jurisdiction to hear and determine all dis-
43  putes as to such charges and interest due thereon and shall prescribe
HB 2475

 1  procedural rules to be followed by the parties to such disputes. In the
 2  event of any controversy arising under this section, payments shall not be
 3  delayed for any amounts not in dispute or controversy. Acceptance by
 4  any provider of services of a payment amount under this section which is
 5  less than the full amount charged for the services, shall not affect the
 6  right to have a review of the claim for the outstanding or remaining
 7  amounts. In the event of a dispute as to such charges, the health care
 8  provider, hospital, institution, person or other provider under this section
 9  may appear and be represented in the action under the workers com-
10  pensation act.
11    (7)  If the director finds, after utilization review and peer review, that
12  a provider or facility has made excessive charges or provided or ordered
13  unjustified treatment, services, hospitalization or visits, the provider or
14  facility shall not receive payment pursuant to this section from an insur-
15  ance carrier, employer or employee for the excessive fees or unjustified
16  treatment, services, hospitalization or visits and such provider or facility
17  shall repay any fees or charges collected therefor.
18    (8)  Not later than December 31, 1993, the director shall develop and
19  implement, or contract with a qualified entity to develop and implement,
20  utilization review and peer review procedures relating to the services
21  rendered by providers and facilities, which services are paid for in whole
22  or in part pursuant to the workers compensation act. The director may
23  contract with one or more private foundations or organizations to provide
24  utilization review, as appropriate, of entities providing health care services
25  or vocational rehabilitation services, or both, pursuant to the workers
26  compensation act.
27    (9)  By accepting payment pursuant to this section for treatment or
28  services rendered to an injured employee, a health care provider or health
29  care facility shall be deemed to consent to submitting all necessary records
30  to substantiate the nature and necessity of the service or charge and other
31  information concerning such treatment to utilization review and peer re-
32  view under this section. Such health care provider shall comply with any
33  decision of the director pursuant to subsection (a)(10).
34    (10)  If it is determined by a peer review committee that a provider
35  improperly overutilized or otherwise rendered or ordered unjustified
36  treatment or services or that the fees for such treatment or services were
37  excessive, the director may order the provider to show cause why the
38  provider should not be required to repay the amount which was paid for
39  rendering or ordering such treatment or services and shall provide the
40  provider a hearing thereon if requested. If a hearing is not requested
41  within 30 days of receipt of the order and the director decides to proceed
42  with the matter, a hearing shall be conducted and if a prima facie case is
43  established a final order shall be issued by the director. If the final order
HB 2475

 1  is adverse to a health care provider, the director shall provide a report to
 2  the licensing board of the health care provider with full documentation
 3  of any such determination, except that no such report shall be provided
 4  until after judicial review if the order is appealed. Any order of the di-
 5  rector under this section shall be subject to review by the board.
 6    (11)  Except as provided by K.S.A. 60-437 and amendments thereto
 7  or this section, all reports, information, statements, memoranda, pro-
 8  ceedings, findings and records which relate to utilization review or peer
 9  review conducted pursuant to this section, including any records of peer
10  review committees, shall be privileged and shall not be subject to discov-
11  ery, subpoena, or other means of legal compulsion for release to any
12  person or entity and shall not be admissible in evidence in any judicial or
13  administrative proceeding, except those proceedings authorized pursuant
14  to this section.
15    (12)  A provider or facility may not improperly charge or overcharge
16  a workers compensation insurer or charge for services which were not
17  provided, for the purpose of obtaining additional payment.
18    (13)  Any violation of the provisions of this section which is willful or
19  which demonstrates a pattern of improperly charging or overcharging
20  workers compensation insurers constitutes grounds for the director to
21  impose a civil fine not to exceed $5,000. Any civil fine imposed under
22  this section shall be subject to review in accordance with the act for
23  judicial review and civil enforcement of agency actions in the district court
24  for Shawnee county. All moneys received for civil fines imposed under
25  this section shall be deposited in the state treasury to the credit of the
26  workers compensation fund.
27    (14)  As used in this subsection (a), unless the context or the specific
28  provisions require otherwise, ``provider'' means any health care provider
29  or vocational rehabilitation service provider, and ``facility'' means any fa-
30  cility providing health care services or vocational rehabilitation services,
31  or both, including any hospital.
32    (b)  Any health care provider, nurse, physical therapist, any entity pro-
33  viding medical, physical or vocational rehabilitation services or providing
34  reeducation or training pursuant to K.S.A. 44-510g and amendments
35  thereto, medical supply establishment, surgical supply establishment, am-
36  bulance service or hospital who accept the terms of the workers compen-
37  sation act by providing services or material thereunder shall be bound by
38  the fees approved by the director and no injured employee or dependent
39  of a deceased employee shall be liable for any charges above the amounts
40  approved by the director. If the employer has knowledge of the injury
41  and refuses or neglects to reasonably provide the services of a health care
42  provider required by this section, the employee may provide the same
43  for such employee, and the employer shall be liable for such expenses
HB 2475

 1  subject to the regulations adopted by the director. No action shall be filed
 2  in any court by a health care provider or other provider of services under
 3  this section for the payment of an amount for medical services or materials
 4  provided under the workers compensation act and no other action to
 5  obtain or attempt to obtain or collect such payment shall be taken by a
 6  health care provider or other provider of services under this section, in-
 7  cluding employing any collection service, until after final adjudication of
 8  any claim for compensation for which an application for hearing is filed
 9  with the director under K.S.A. 44-534 and amendments thereto. In the
10  case of any such action filed in a court prior to the date an application is
11  filed under K.S.A. 44-534 and amendments thereto, no judgment may be
12  entered in any such cause and the action shall be stayed until after the
13  final adjudication of the claim. In the case of an action stayed hereunder,
14  any award of compensation shall require any amounts payable for medical
15  services or materials to be paid directly to the provider thereof plus an
16  amount of interest at the rate provided by statute for judgments. No
17  period of time under any statute of limitation, which applies to a cause
18  of action barred under this subsection, shall commence or continue to
19  run until final adjudication of the claim under the workers compensation
20  act.
21    (c) (1)  If the director finds, upon application of an injured employee,
22  that the services of the health care provider furnished as provided in
23  subsection (a) and rendered on behalf of the injured employee are not
24  satisfactory, the director may authorize the appointment of some other
25  health care provider. In any such case, the employer shall submit the
26  names of three health care providers that are not associated in practice
27  together. The injured employee may select one from the list who shall
28  be the authorized treating health care provider. If the injured employee
29  is unable to obtain satisfactory services from any of the health care pro-
30  viders submitted by the employer under this subsection (c)(1), either
31  party or both parties may request the director to select a treating health
32  care provider.
33    (2)  Without application or approval, an employee may consult a
34  health care provider of the employee's choice for the purpose of exami-
35  nation, diagnosis or treatment, but the employer shall only be liable for
36  the fees and charges of such health care provider up to a total amount of
37  $500. The amount allowed for such examination, diagnosis or treatment
38  shall not be used to obtain a functional impairment rating. Any medical
39  opinion obtained in violation of this prohibition shall not be admissible
40  in any claim proceedings under the workers compensation act.
41    (d) (c)  An injured employee whose injury or disability has been es-
42  tablished under the workers compensation act may rely, if done in good
43  faith, solely or partially on treatment by prayer or spiritual means in ac-
HB 2475

 1  cordance with the tenets of practice of a church or religious denomination
 2  without suffering a loss of benefits subject to the following conditions:
 3    (1)  The employer or the employer's insurance carrier agrees thereto
 4  in writing either before or after the injury;
 5    (2)  the employee submits to all physical examinations required by the
 6  workers compensation act;
 7    (3)  the cost of such treatment shall be paid by the employee unless
 8  the employer or insurance carrier agrees to make such payment;
 9    (4)  the injured employee shall be entitled only to benefits that would
10  reasonably have been expected had such employee undergone medical
11  or surgical treatment; and
12    (5)  the employer or insurance carrier that made an agreement under
13  paragraph (1) or (3) of this subsection may withdraw from the agreement
14  on 10 days' written notice.
15    (e) (d)  In any employment to which the workers compensation act
16  applies, the employer shall be liable to each employee who is employed
17  as a duly authorized law enforcement officer, ambulance attendant, mo-
18  bile intensive care technician or firefighter, including any person who is
19  serving on a volunteer basis in such capacity, for all reasonable and nec-
20  essary preventive medical care and treatment for hepatitis to which such
21  employee is exposed under circumstances arising out of and in the course
22  of employment.
23    (f) (e)  No person shall be subject to civil liability for libel, slander or
24  any other relevant tort cause of action by virtue of performing utilization
25  review or peer review under contract with the director pursuant to sub-
26  section (a)(7).
27    Sec. 2.  K.S.A. 1996 Supp. 44-510 is hereby repealed.
28    Sec. 3.  This act shall take effect and be in force from and after its
29  publication in the statute book.