Missouri Senate

House Committee Substitute

ACCIDENT AND INJURY - The act modifies the definition of "accident" to include only events that are "an unexpected traumatic event or unusual strain identifiable by time and place of occurrence producing at the time objective systems of an injury, caused by a specific event during a single work shift". The act modifies the definition of "injury" by limiting the definition to only allow compensation if the accident was the prevailing factor in causing the condition. The act limits benefits for pre-existing conditions in cases where a work-related injury causes increased permanent disability and reduces compensation by the amount of permanent partial disability that was pre-existing. The act exempts from coverage injuries from unknown causes and personal health conditions that manifest themselves at work, when an accident is not the prevailing factor in the need for medical treatment. Prohibits accidents which are sustained while traveling to the employer's principal place of business from the employee's home or to the employee's home from the employer's principal place of business from being compensable.

ABROGATION OF CASE LAW - It is the intent of the Legislature to reject and abrogate earlier case law interpretations on the meaning of or definition of "arising out of", and "in the course of the employment", as extended in the following cases: Bennet v. Columbia Health Care and Rehabilitation, 80 S.W. 3d 524, (Mo. App. W.D. 2002); Kasl v. Bristol Care, Inc., 984 S.W. 2d 852 (Mo. banc 1999); and Drewes v. TWA, 984 S.W. 2d 512 (Mo.banc 1999).

EMPLOYER LIABILITY - Any person who contracts to have work done as part of the usual course of business on their premises shall be liable to the contractor, it's subcontractors and employees for death or injury which occurs on the premises. If the erection of improvements, demolition, alteration or repair of the premises is being provided by an independent contractor, the independent contractor shall be deemed the employer of the subcontractors and employees where the principle contractor is on the premises and doing work. The immediate contractor or subcontractor shall have primary liability as an employer of the employees of his subcontractor. A right to contribution is available for any secondarily liable parties. The provisions of this section (Section 287.041 RSMo.) shall not apply to for-hire motor carriers. The changes to the provisions of subsection 1 of section 287.040 are remedial and curative and should be given that consideration.

COMPENSABILITY - Occupational disease is only compensable if the occupational exposure was the prevailing factor in causing the condition. Injury due to repetitive motion is recognized as an occupational disease and is only compensable if the occupational exposure is a prevailing factor in causing the medical condition or disability. Disease of the lungs or respiratory tract, hypotension, hypertension, or disease of the heart or cardiovascular system, including carcinoma, may be recognized as occupational diseases for the purposes of workers' compensation law and are defined to be disability due to exposure to smoke, gases, carcinogens, inadequate oxygen of firefighters of a paid fire department or police officers of a paid police department certified under Chapter 590, RSMo.

REDUCTION OF BENEFITS FOR CERTAIN ACTS - The act eliminates the posting requirements for reduction of compensation and death benefits where an injury is caused by the failure the employee to use employer provided safety devises. The act increases the penalty when violation of a drug or alcohol rule is involved, by mandating that workers' compensation and death benefits be forfeited. A health care provider shall be compensated for all authorized services such provider rendered prior to an order reducing compensation under this section. Intoxication at or above the legal blood level shall give rise to a conclusive presumption that the voluntary use of alcohol was the proximate cause of injury. An employee must forfeit compensation for any injury under the provisions of workers' compensation law when the employee: accepts workers' compensation benefits under the laws of another state; files a claim or application for a hearing in another state requesting workers' compensation benefits; or indicates an intent to receive benefits for the injury or occupational disease under another state's workers' compensation law.

NOTICE POSTING BY EMPLOYERS - Every employer must post notice in a prominent and conspicuous place, which notifies employees of the requirement that such employees must inform their employers of an accident within thirty days from such accident and that failure to do so may jeopardize their ability to receive medical coverage, compensation or any other benefit for the injury under workers' compensation law.

CRIMINAL PENALTIES FOR VIOLATIONS OF WORKERS' COMPENSATION LAW- 1. Any insurance company or self-insurer who intentionally refuses to comply with known and legally indisputable compensation obligations with an intent to defraud will be guilty of a Class A misdemeanor, and receive the greater of a fine up to ten thousand dollars or double the value of the fraud. The punishment for a subsequent offense is a Class D felony.

2. Any person who knowingly files a claim against the second injury fund in this state if the person has filed a claim under the workers' compensation law of another state for the same injury or occupational disease will be guilty of a Class A misdemeanor. The punishment for a subsequent will be a Class D felony.

3. Any health care provided who commits fraudulent billing practices will be guilty of a Class A misdemeanor and receive a fine of up to twenty thousand dollars. The punishment for a subsequent offense is increased to a Class D felony.

ANNUAL REPORT FROM THE ATTORNEY GENERAL - By January 1, 2006, the Attorney General shall forward to the Division of Workers' Compensation and the members of the General Assembly, the first addition of an annual report of the costs of prosecuting fraud and noncompliance under workers' compensation law. The report will include the number of cases filed with the Attorney General by county, by the fraud and noncompliance unit, the number of cases prosecuted by county by the Attorney General and county prosecutor, fines and penalties levied and received, and all incidental costs.

VOCATIONAL TESTING AND ASSESSMENT - The act provides that an employee must submit to appropriate vocational testing and a vocational rehabilitation assessment required by an employer or insurer.

SUBROGATION LIENS - The act grants an employer a subrogation lien when a third person is liable for the death of an employee.

DISQUALIFICATION FOR RECEIPT OF UNEMPLOYMENT COMPENSATION OR POST INJURY MISCONDUCT - Disqualifies an employee from receiving temporary total disability during any period of time in which the claimant applies and receives unemployment compensation. Any employee who is terminated from post injury employment based upon post injury misconduct shall be ineligible to receive either temporary total disability or temporary partial disability benefits.

PROOF OF PERMANENT DISABILITY - Permanent partial or total disability shall be demonstrated and certified by a physician. In determining the impairment subjective complaints shall not be considered unless certified by a physician. The fifth edition of "Guide to the Evaluation of Permanent Impairment", published by the American Medical Association, shall be applied in determining the level of disability under workers' compensation law.

COMPENSATION FOR HEARING LOSS - Loss of hearing of twenty-six decibels or less shall not constitute any compensable hearing disability and loss of hearing average ninety-two decibels shall constitute total or one hundred percent compensable hearing loss.

COSTS - If the division or the commission determines that any proceedings have been brought, prosecuted, or defended without reasonable grounds, the division may assess the whole cost of the proceedings upon the party who brought, prosecuted, or defended them.

WAGES AND BONUSES - A monetary bonus, paid by an employer to an employee, of up to three percent of the employee's yearly compensation from such employer shall not have the effect of increasing the compensation amount used in calculating the employee's compensation or wages for purposes of any workers' compensation claim governed under workers' compensation law.

ACCIDENT REPORTING - The act requires every employer or his insurer in this state file with the division a full and complete report of every injury or death to any employee within thirty days from the date of injury or death.

VOLUNTARY SETTLEMENT AGREEMENTS - Allows parties to enter into voluntary agreements to settle claims and states that approval shall be granted as long as the settlement is not manifestly unjust. In any claim where an offer of settlement is made in writing, and the employee is not represented by counsel, the employee is entitled to one hundred percent of the amount offered. If the employee rejects the offer, the employee is entitled to one hundred percent of the initial offer and seventy five percent of any amount in dispute. An attorney may only collect twenty-five percent of an amount over the initial offer.

NOTICE OF REPETITIVE TRAUMA CASE - Requires written notice to an employer be made no later than thirty days after diagnosis of the condition before proceedings are maintained for a repetitive trauma or occupational disease case.

ADMINISTRATIVE LAW JUDGES - After August 28, 2005, the governor may appoint additional administrative law judges for a maximum of forty authorized administrative law judges. The terms of administrative law judges are set out and must be published by the director of the division of workers' compensation. Performance audits shall be done annually by the division director with a recommendation of confidence or no confidence for each administrative law judge. Any administrative law judge may be discharged or removed only by the governor under a performance audit by the administrative law judge review committee.

COMPENSATION FOR CHIEF COUNSEL - Each chief legal counsel located at the division office in Jefferson City, MO shall be compensated at two thousand dollars above eighty percent of the rate at which an associate circuit judge is compensated.

SECOND INJURY FUND - Beginning October 31, 2005, the Director of the Division of Workers' Compensation is required to estimate the amount of benefits payable for each year and calculate the total amount of annual surcharge to be imposed upon all workers' compensation policyholders and self-insured for the following calendar year. The amount of the annual surcharge shall be set at a percentage not to exceed three percent.

STANDARD OF REVIEW - Imposes strict construction review with regard to the provisions of the workers compensation chapter and an impartial standard of review for the facts and evidence of a case. Beginning January 1, 2006, only administrative law judges, the commission, and the appellate courts of this state shall have the power to review claims filed under workers' compensation law.

OPT- OUT PROVISION - Allows an employee to opt out of the provisions of workers' compensation law for religious reasons.

BURDEN OF PROOF - The burden of proof for establishing an affirmative defense is on the employer. The burden of proving an entitlement to compensation under workers' compensation law is on the employee or dependent.

CLAIMS AGAINST INSOLVENT SELF-INSURED PARTIES - Requires the Division to notify each employee of a self-insured member filing bankruptcy of his or her obligation to file a notice of claim with the court of jurisdiction and of the need of the employee to provide the guarantee fund and the division with the records set out in this section. The act then requires the claimant to file a claim with the appropriate bankruptcy court prior to the time Division of Workers' Compensation attaches jurisdiction.

TREND FACTORS- The Director of Insurance may formulate trend factors that allow for comparison with trend factors developed by the advisory organization for each of the job classifications.

JASON ZAMKUS