SB 3--Am.
As Amended by Senate Committee
Session of 1997
By Special Committee on Insurance

10 AN ACT concerning workers compensation and health benefits insur- 11 ance; providing for the establishment of 24-hour coverage pilot pro- 12 jects for insurance coverage for employers in the state of Kansas. 13 14 Be it enacted by the Legislature of the State of Kansas: 15 Section 1. This act shall be known as the 24-hour coverage pilot pro- 16 ject act. 17 Sec. 2. As used in this act: 18 (a) ``Insurance carrier'' means an insurance company or health main- 19 tenance organization licensed to transact the business of accident and 20 health or workers compensation insurance in this state; 21 (b) ``nonworkplace injuries and illness'' means any injury, illness or 22 disease, including death, that is covered by an accident and sickness policy 23 pursuant to chapter 40 of the Kansas Statutes Annotated; 24 (c) ``workplace injuries and illness'' means that type of injury, illness 25 or disease, including death, which is considered to be a compensable 26 injury arising out of and in the course of employment that is subject to 27 the provisions of K.S.A. 44-501 et seq., and amendments thereto. 28 Sec. 3. The commissioner of insurance, after consultation with the 29 24-hour coverage task force established pursuant to section 12, may 30 promulgate rules and regulations to establish one or more pilot projects 31 which will enable employers to enter into agreements with insurance 32 carriers to provide their employees with health care and indemnity ben- 33 efits for workplace injuries and illness and nonworkplace injuries and 34 illness. The rules and regulations of the commissioner shall include pro- 35 visions for the following: 36 (a) The benefits required to be provided pursuant to the contract; 37 (b) the benefits required to be paid after the expiration of any pilot 38 projects for compensable work-related injuries and illness which occurred 39 during the term of the project; 40 (c) the health insurance benefits required to be paid for nonwork- 41 place injuries and illness after the expiration of the pilot projects, except 42 that any accident and health insurance provided to an employer after the 43 end of a pilot project shall not require a waiting period for any preexisting SB 3--Am.

 1  condition that was covered by the contract issued during the pilot project;
 2    (d)  the rights of employees to benefits in the event of a cancellation
 3  of coverage or termination of employment prior to the expiration of the
 4  pilot project;
 5    (e)  all reporting requirements for the pilot projects;
 6    (f)  grievance procedures; and
 7    (g)  standards for collecting and compiling premium and loss experi-
 8  ence data.
 9    Sec. 4.  Coverage under any pilot project shall provide disability in-
10  come and rehabilitation benefits for work-related injuries at least equiv-
11  alent to that ordinarily provided to eligible employees pursuant to K.S.A.
12  44-501 et seq., and amendments thereto.
13    Sec. 5.  An insurance carrier licensed to write accident and health
14  insurance or licensed to write workers compensation insurance in the
15  state of Kansas, notwithstanding any provisions of K.S.A. 44-501 et seq.,
16  and amendments thereto, to the contrary and without further amending
17  its certificate of authority, may participate in the pilot projects pursuant
18  to this act and issue insurance contracts to provide coverage for workplace
19  injuries and nonworkplace injuries, as approved by the commissioner. The
20  commissioner shall consider at least the following criteria in the approval
21  process for insurance carriers to participate in the pilot projects:
22    (a)  The ability to provide coverage to employees and handle claims
23  for nonworkplace injuries and illness and workplace injuries and illness;
24    (b)  a demonstrated history of financial stability;
25    (c)  the ability to establish reserves and additional deposits for the
26  commissioner decides may be necessary for occurrence based claims;
27    (d)  the ability to commit necessary resources for the duration of the
28  entire pilot project;
29    (e)  a demonstrated ability to comply with the reporting requirements
30  of the pilot project;
31    (f)  the ability to provide recommendations to employers and imple-
32  ment safety, wellness and loss control programs;
33    (g)  minimum capital and surplus as determined by the commissioner;
34    (h)  the acceptance by all employers of the terms and conditions of
35  the pilot project; and
36    (i)  an approved complaint procedure, described in writing and pro-
37  vided to all affected workers and health care providers.
38    Sec. 6.  The commissioner, after consultation with the task force es-
39  tablished by section 12, is authorized without a requirement that there
40  be a after a competitive bidding process, to enter into contracts with
41  insurance carriers, health care providers and other persons and entities
42  as may be deemed necessary and appropriate to carry out the purposes
43  of this pilot project.
SB 3--Am.

 1    Sec. 7.  The commissioner may accept grants and gifts of money from
 2  any public or private public interest or eleemosynary institution, person
 3  or foundation as may be deemed reasonably appropriate and in the best
 4  interests of the state for the purpose of implementing the pilot project.
 5    Sec. 8.  The exclusive remedy provisions pursuant to article 5 of chap-
 6  ter 44 of the Kansas Statutes Annotated and the prohibited defense pro-
 7  visions pursuant to article 5 of chapter 44 of the Kansas Statutes Anno-
 8  tated shall apply to actions to recover damages brought by employees
 9  against employers for workplace injuries and illness covered by the pilot
10  projects established pursuant to this act.
11    Sec. 9.  Any policy for coverage of workplace injuries and illness and
12  for nonworkplace injuries and illness issued by an insurance carrier pur-
13  suant to this act, shall not be issued or delivered to a participating em-
14  ployer until a copy of the form is filed with the department of insurance
15  and approved by the commissioner.
16    Sec. 10.  Each insurance carrier participating in a pilot project pur-
17  suant to this act shall file with the commissioner its manual of rules, rates
18  and rating systems that will be applicable to the pilot project. Rates shall
19  not be excessive, inadequate or unfairly discriminatory.
20    Sec. 11.  The commissioner shall make a report to the Kansas legis-
21  lature on or before January 1 of each year on the activities, findings and
22  recommendations of the commissioner relative to the pilot projects. The
23  commissioner shall monitor, evaluate and report the following informa-
24  tion regarding the pilot projects:
25    (a)  Cost savings to employers participating in the pilot projects;
26    (b)  effectiveness of the coverages provided to employees;
27    (c)  complaints from those insurance carriers, employers and employ-
28  ees who participated in the pilot projects;
29    (d)  recommendations to continue or discontinue the pilot projects;
30  and
31    (e)  recommendations for any necessary legislative changes to the
32  Kansas insurance code or to the workers compensation laws of this state.
33    Sec. 12.  (a) There is hereby established a 24-hour coverage task force
34  to assist the commissioner with the study of 24-hour coverage insurance
35  and the development of rules and regulations for the establishment of
36  pilot projects pursuant to this act. The task force shall consist of 12 mem-
37  bers who shall be selected as follows:
38    (1)  The commissioner of insurance who shall serve as the chairperson
39  of the task force;
40    (2)  the director of the division of workers compensation;
41    (3)  two persons appointed by the governor;
42    (4)  two persons appointed by the commissioner of insurance;
43    (5)  two persons appointed by the president of the senate;
SB 3--Am.

 1    (6)  two persons appointed by the speaker of the house;
 2    (7)  one person appointed by the minority leader of the senate; and
 3    (8)  one person appointed by the minority leader of the house of rep-
 4  resentatives.
 5    (b)  Any vacancies on the task force shall be filled by the officer who
 6  appointed the member of the task force who is being replaced.
 7    (c)  Task force members enumerated in paragraphs (3) through (8) of
 8  subsection (a) shall receive amounts provided by subsection (e) of K.S.A.
 9  75-3223, and amendments thereto, for each day of actual attendance at
10  any meeting of the task force or any subcommittee meeting approved by
11  the task force. Such amounts paid to members shall be paid from appro-
12  priations for the insurance department pursuant to vouchers approved by
13  the commissioner of insurance.
14    Sec. 13.  The provisions of sections 1 through 12 shall expire on Jan-
15  uary 1, 2002.
16    Sec. 14.  This act shall take effect and be in force from and after its
17  publication in the statute book.