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MONTANA SELF INSURERS' ASSOCIATION

MSIA Legislative Update 2/24/23 - Week 8

  • The Week Prior to Transmittal Date – Bills drop, are heard & action taken
  • HB 719 – Choice of Physician Introduced - Hearing 2/24
  • HB 451 – Pierce Exclusive Remedy - Withdrawn
  • SB 310 – Added Cancers for Firefighter Presumptions – Heard & Passed Committee
  • SB 369 – Vax Reactions Including Derivative Injuries – Heard 2/22 Amendment Agreement
  • HB 490 – IC definition - Heard – Amendment Agreement
  • Legislative Update        


Bills that have been formally introduced have either a House Bill (HB) or Senate Bill (SB) number. Bills that have been requested and/or drafted but not yet introduced are assigned a Legislative Counsel (LC) number. Not all LC bills are introduced. The bills or draft language where there has been a change are reported first and are in numeric order, then those where there is no status change are reported. Those bills that are reported as dead, are eliminated from the report as is the case with the State Fund bills which were reported as dead last week.


This is the week before transmittal date, next Friday 3/3. As of that date, non-revenue bills that have not passed their chamber of origin, are dead, although in the legislative process, there are different levels of death. Transmittal date death is a relatively serious death. As a result, bills have to be introduced, heard in Committee, acted upon there and then see floor action. That is a process that typically takes a minimum of four days. That timeline can be shortened but if it is, the issue has to be one that generates no serious objections or is something the leadership needs to get through. 


This year, adding to the issue is the shortage of legislative staff to write, review and edit legislative language. We have seen delays in getting language through the staff process and as a result, there is some discussion of passing bills and agreeing to amend them to address potentially known issues in the second Committee. This week we have seen bills suddenly appear and have a very fast hearing date. That was the case with HB 719 – the WC Choice of Physician (see below). We have also seen relatively fast Committee action, and that was the case with SB 310 – adding ovarian and testicular cancers to the Firefighters presumptions already in law. 


One way to avoid transmittal date death, is to attach some kind of revenue amendment to the bill – revenue bill transmittal date is 3/29. Some bills will see amendments proposed and adopted to provide some minimal revenue to the state to extend the time to work on the bill. Some, which had not been identified as revenue bills, can be determined to be revenue bills. Generally, the rules are not abused, but they are used. 


As a rule, MSIA works on legislative language prior to a hearing with the goal that at the least the sponsors nor the committee are surprised by our positions. This week has been difficult, and for the most part, legislators have been kind in hearing from us on short notice. 



HB 451               Gist                     R-Great Falls                  This bill would permit any worker who was required to be vaccinated as part of their employment, if the employer accepted any state or federal funds, to bring suit against their employer – it pierced the exclusive remedy. This bill has been withdrawn and should be completely dead. MSIA opposed this bill. 


HB 490              Gist                     R-Great Falls                  As originally drafted this bill provided penalties for employers hiring people as independent contractors when they were not, and for construction only, instituted the California ABC test for IC determination. The ABC test is a very high standard and one which would have eliminated the current Montana ICEC standards. In speaking with Representative Gist his concern was based on the potential for human trafficking and agreed to an amendment which eliminates the ABC test language and to require higher penalties against employers for retaining employees and classifying them as IC’s. The bill was heard in House Business & Labor on 2/21 and the amendment was introduced by Representative Gist as the substance of the bill. Organized labor supported the bill and we do not think they will have an issue with the amendment language. With the amendment, the bill is expected to pass Committee and likely pass the full House. For more details on the ABC test, see the CA Supreme Court Dynamex decision in 2018, S222732.PDF (ca.gov). MSIA provided ‘soft’ opposition to the bill as originally drafted and in support of the amendment. With those changes, does not need to oppose this statutory change. 


HB 506                           Nicol                   R-Billings         This bill would permit the state of Montana to choose WC coverage from Plan 1 (self insurance), Plan 2 (commercial coverage) or continue, as is statutorily required, with Plan 3 (MSF). Revise workers’ compensation laws to provide freedom of competition. The language does not include a proposal for a residual market mechanism as was speculated. There are details regarding allowing MSF to continue to provide coverage for themselves, should the state choose a Plan 2 carrier and to permit MSF to act as a third party administrator (TPA) should the state choose to become self insured. The bill was heard in the House Business & Labor Committee on 2/23. A number of business and labor organizations testified against the bill – claiming it will weaken the financial security of MSF, should the state move to either a self insurance program or a Plan 2 policy. MSIA is monitoring this bill.


HB 590              Buttrey             R – Great Falls               This bill requires health care employers to report incidents. It does not require a workers’ compensation claim be made by the employer. This bill is set for hearing in the House Business & Labor Committee, chaired by the sponsor, on Monday 2/27. The bill was drafted with the assistance of the College of ER Physicians. MSIA is reviewing this language to determine a position. SB 241 was a companion to HB 590 and was tabled in Senate Public Health, Welfare & SafetyCommittee on 2/3 at the request of the sponsor, likely in deference to the House bill. MSIA did not ultimately take a position on this bill, but would have opposed it, based on the mandatory WC claim reporting requirement which is not in the House version.


             HB 636               J. Kassmier        R-Bozeman                     This bill would reduce the corporate officer/owner threshold to exempt themselves from workers compensation coverage from 20% of the business to 10% of the business. MSIS is monitoring this bill. 


HB 678              Nicol                   R-Billings                          This bill is pretty broad in covering many of the administrative and legal process concerns defense attorneys and carriers have had about our system. The following are my highlights of the bill – there are more details within the legislation. It starts with requiring that the claimant has the burden of proof on a more probably than not basis for all matters in litigation. It mandates that treating providers not be provided deference and that medical opinions be based on experience, expertise and credibility; it specifically provides that PA’s can be treating physicians (116 (42)(c)); insurers would be entitled to a new IME after 90 days, based on change in condition, or a new medical causation issue (605 (1)(a)); the language eliminates the 14 day notice of change in benefit status if there is a full duty release(609 (new (3)); provides a limitation on DOL ordered benefit payments to a demonstration that the claimant is likely to prevail and excludes disputes over the selection of the treating physician, refusal to cooperate with medical care, a nurse case manager, an IME or unaccepted body parts and that such ordered benefits are stayed on appeal (610 (new 2)). The bill eliminates attorney fees for common fund cases (613 (new 4)), prohibits mandating benefit payments under the 615 reservation of rights(615 (new 4)), eliminates the reference that benefits for subsequent injuries benefits are limited to the same body parts (703 (8)) and limits attorney fees in specific cases by repealing sections 611, 612, 614 and 2907. 

MSIA is reviewing specific language, but generally will support the bill.       


HB 719              Oblander           R – Billings                      The bill would over-turn the 2011 HB 334 changes which gave employers the right to direct medical care through the choice of physician. The bill was assigned to the House Human Services Committee where it was heard two days after being introduced in an attempt to beat the transmittal date deadline. MSIA testified against the bill along with other business and insurance interests (our formal testimony is attached). In his testimony in support of the bill, Representative Oblander, a chiropractor, indicated he had heard from constituents that some medical providers were not getting their share of workers’ compensation business. Some other Republican legislators stood up in favor of the bill, as a freedom of choice in medical issues, during the testimony. Business and insurance representatives, including MSIA members MSBGA, MMIA and MCCF were united in opposing the bill. MSIA opposes any changes to the current law. 


SB 310                Small                  R-Busby                           This bill adds ovarian and testicular cancers to the list of presumptive illnesses covered for firefighters. This bill has the strong support of leadership and we were told it will pass. The bill in the Senate Business, Labor & Economic Affairs Committee on 2/21 and was passed out of the Committee 9 – 1 on 2/22. MSIA opposed this bill but did not testify. 


SB 369                Trebas               R – Great Falls                This bill would specifically identify in workers’ compensation statute that an injury or accident covered under the law would include a serious adverse event experienced by an employee after receiving a vaccine mandated by the employer. It then defines “serious adverse event” to include, among other things normally covered by the current law, “a congenital anomaly or a birth defect.” That language seems to imply a derivative exposure of a workers’ compensation issue and is a significant change to our law. MSIA worked with the sponsor and supported the amendment deleting the congenital anomaly and birth defect language. The bill was heard in the Senate Public Health, Welfare and Safety Committee on 2/22 MSIA testified in opposition to the bill and in support of the amendment. 


SB 496/LC 1762  S. O’Brien       D – Missoula                  This bill would require an annual update to the housing amounts used for remuneration inclusion, if housing is provided as part of wages. MSIA is reviewing the language to determine a position.


LC 3180              Harvey               D – Butte                        This bill has not yet been introduced. The language would repeal the sunset provision of the 2019 law that has the state reimburse employers for increased workers’ compensation cost for being involved in certain work-based learning programs. MSIA is reviewing the language to determine a position.  


The following bills have not seen action this week. 


HB 178               K. Walsh           R-Twin Bridges              This bill clarifies that injuries which occur off the clock and as the result of social or recreational activity on the employer’s premises are not compensable. The bill defines that a social or recreational activity is one that includes exercise, pleasure, relaxation, or voluntary optional preparation related to the employment. For example, should a ski area or golf course employee injure themselves while skiing or golfing off the clock during a work day, they would not be covered by WC in that specific instance. The bill passed final reading in the Senate 42 – 6 on 2/13 and will be sent to the Governor. The bill is expected to be signed by the Governor. 


HB 313               Etchart             R-Billings                          This bill would permit Physician Assistants (PA’s) to have an independent practice. Under current law, PA’s must work under a supervising physician. The bill was heard in House Business & Labor Committee on Friday 2/3. Proponents included the MT Association of Physician Assistants, the Health Policy Advisor to Governor Gianforte, Blue Cross/Blue Shield, the MT Association of Nurse Anesthetists and individual PA’s. Opponents included the MT Medical Association (MMA), the MT Nurses Association and individual physicians and a medical student. While this bill does not have a direct impact on WC, it is not a big leap to assume that PA’s will want treating physician status under the WC law. These actions are happening around the country and we would be surprised not to see at least a proposal here. MMA provided an amendatory proposal based on current UT law, which would allow PA’s to have independent practice, after an addition 10,000 hours (5 years) of practice experience. MSIA has not taken a position on this bill at this time. 


SB 22                  Morigeau          D-Missoula                    This bill is the clean-up of the attempt last session to require the Department of Labor to do more investigation regarding an independent contractor or employee designation rather than rely solely on the presence, or absence, of an ICEC. The bill has been amended so that someone who presents an Independent Contractor Exemption Certificate (ICEC) is presumed to be an independent contractor, unless the ICEC is forged or otherwise fraudulent, or the ICEC expired within 120 days while working with that contractor. The amended bill passed final reading in the Senate 48 – 0 on 2/16. The bill now goes to the House for consideration. MSIA supports the amended version of the bill.


SB 165                Usher                 R-Billings                         This bill requires first and third party claimants against insurers to provide information and cooperate with an insurers’ claims adjudication process in a timely manner and provides insurers an affirmative defense if they do not. In addition, it amends the Unfair Trade Practices Act (UTPA) so that third party claimants would no longer have a common law bad faith action opportunity against insurers, as created in the BREWINGTON v EMPLOYERS FIRE INS C :: 1999 :: Montana Supreme Court Decision. Under the current law, first party claimants (your insured) have a private right of action against their insurer, should the company not deal in good faith in adjudicating the claim. Third party claimants, under this proposal, would specifically have the same rights, and be limited to those rights. The bill passed final reading in the Senate 34-14 along party lines on 2/16. The bill now goes to the House for consideration. MSIA supports this bill and testified in favor.


SB 260               D Salomon        R-Ronan                          This bill would change the Unfair Trade Practices Act (UTPA) in the insurance law so that the independent cause of action section of the UTPA claims practices clause does not apply to a captive insurance company (but does apply to captive risk retention groups). Currently the language of 33-18-242 (8) specifically includes self-insurance as being covered under the law. However, self-insurance is not defined in the insurance code. A Supreme Court decision, Dannels v BNSF (Dannels v. BNSF :: 2021 :: Montana Supreme Court Decision) specifically addressed the application of the unfair claims practices application and the private right of action to both captives and self-insurers (see Justice Sandifur’s consent). MSIA will support this bill as we have created legislative intent through the sponsors’ testimony that captive insurance is a form of self-insurance and the UTPA would not apply to either. Together with SB 165, above, the UTPA will be strengthened to limit actions against self-insurers that are permitted under current law. The bill passed final reading in the Senate 46 – 4 on 2/14. The bill now goes to the House for consideration. MSIA supports this bill.   


LC3179               Harvey               D-Butte                         This bill draft was the subject of an MSIA email on January 18 to membership. This bill has not yet been introduced. The current language proposes to increase indemnity benefits from 66.66% of weekly wage to 100% (subject to state average weekly wage maximum). NCCI has produced a pricing memo (attached) identifying that this change to the law would result in an increase of between 11.8% and 15.3% when it went into effect. The Department of Insurance and the Department of Labor are aware of the NCCI memo. MSIA has also communicated with business interests about this language. MSIA will work to make sure this bill in either the current (or potential language)to provide as much in wage loss benefits as take home pay will not get beyond a hearing in committee, should it be introduced. MSIA will oppose this kind of change to the law and will work with others to defeat it. 

             

LC 679                Nicol                   R-Billings                        Revise workers' compensation laws related to illegal aliens. There is no language to this bill title as yet.


LC 1724              A. Olsen            D-Missoula                   Provide worker right to choose physician in workers' compensation case. There is no language associated with this bill yet. Representative Olsen has either sponsored or supported this kind of proposal in the past and it is a Democratic leadership supported proposal. This LC number remains available, despite the introduction of HB 719 (above), so it remains as potential language to be introduced, however time is running out. MSIA will oppose changing the current law regarding choice of physician. 


LC 1728              A. Olsen             D-Missoula                   Establishes presumption in workers' compensation for COVID-19. There is no language associated with this bill as yet. Representative Olsen has either sponsored or supported this kind of proposal in the past and it is a Democratic leadership supported proposal. MSIA will oppose changing the current law regarding presumptions for injuries or illnesses.


See you next week!