1.1                          A bill for an act 
  1.2             relating to workers' compensation; making changes of a 
  1.3             technical and housekeeping nature; modifying 
  1.4             provisions relating to compensation and procedures; 
  1.5             modifying provisions relating to the special 
  1.6             compensation fund; providing penalties; amending 
  1.7             Minnesota Statutes 1994, sections 13.69, subdivision 
  1.8             1; 79.074, subdivision 2; 176.011, subdivision 16; 
  1.9             176.081, subdivision 1; 176.101, subdivisions 3a and 
  1.10            3i; 176.102, subdivision 11; 176.103, subdivisions 2 
  1.11            and 3; 176.104, subdivision 1; 176.106, subdivision 7; 
  1.12            176.129, subdivision 9; 176.1351, subdivisions 1 and 
  1.13            5; 176.136, subdivisions 1a, 1b, and 2; 176.138; 
  1.14            176.178; 176.181, subdivision 8; 176.183, subdivisions 
  1.15            1 and 2; 176.185, subdivision 1; 176.191, subdivision 
  1.16            1; 176.215, by adding a subdivision; 176.238, 
  1.17            subdivision 6; 176.261; 176.2615, subdivision 7; 
  1.18            176.275, subdivision 1; 176.281; 176.285; 176.291; 
  1.19            176.305, subdivision 1a; 176.645; and 176.83, 
  1.20            subdivision 5; proposing coding for new law in 
  1.21            Minnesota Statutes, chapter 176; repealing Minnesota 
  1.22            Statutes 1994, sections 176.103, subdivision 2a; and 
  1.23            176.191, subdivision 2. 
  1.24  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.25     Section 1.  Minnesota Statutes 1994, section 13.69, 
  1.26  subdivision 1, is amended to read: 
  1.27     Subdivision 1.  [CLASSIFICATIONS.] (a) The following 
  1.28  government data of the department of public safety are private 
  1.29  data:  
  1.30     (1) medical data on driving instructors, licensed drivers, 
  1.31  and applicants for parking certificates and special license 
  1.32  plates issued to physically handicapped persons; and 
  1.33     (2) social security numbers in driver's license and motor 
  1.34  vehicle registration records, except that social security 
  2.1   numbers must be provided to the department of revenue for 
  2.2   purposes of tax administration and the department of labor and 
  2.3   industry for purposes of workers' compensation administration 
  2.4   and enforcement.  
  2.5      (b) The following government data of the department of 
  2.6   public safety are confidential data:  data concerning an 
  2.7   individual's driving ability when that data is received from a 
  2.8   member of the individual's family. 
  2.9      Sec. 2.  Minnesota Statutes 1994, section 79.074, 
  2.10  subdivision 2, is amended to read: 
  2.11     Subd. 2.  [DIVIDENDS.] Dividend plans are not unfairly 
  2.12  discriminatory where different premiums result for different 
  2.13  policyholders with similar loss exposures but different expense 
  2.14  factors, or where different premiums result for different 
  2.15  policyholders with similar expense factors but different loss 
  2.16  exposures, so long as the respective premiums reflect the 
  2.17  differences with reasonable accuracy.  Every insurer ~~referred to~~ 
  2.18  ~~in section 79.20~~ who issues participating policies shall file 
  2.19  with the commissioner a true copy or summary as the commissioner 
  2.20  shall direct of its participating dividend rates as to 
  2.21  policyholders.  The commissioner may study the participating 
  2.22  dividend rates and make recommendations to the legislature 
  2.23  concerning possible bases for unfair discrimination.  
  2.24     Sec. 3.  Minnesota Statutes 1994, section 176.011, 
  2.25  subdivision 16, is amended to read: 
  2.26     Subd. 16.  [PERSONAL INJURY.] "Personal injury" means 
  2.27  injury arising out of and in the course of employment and 
  2.28  includes personal injury caused by occupational disease; but 
  2.29  does not cover an employee except while engaged in, on, or about 
  2.30  the premises where the employee's services require the 
  2.31  employee's presence as a part of ~~such~~ that service at the time 
  2.32  of the injury and during the hours of ~~such~~ that service.  Where 
  2.33  the employer regularly furnished transportation to employees to 
  2.34  and from the place of employment ~~such~~, those employees are 
  2.35  subject to this chapter while being so transported~~, but shall~~.  
  2.36  Personal injury does not include an injury caused by the act of 
  3.1   a third person or fellow employee intended to injure the 
  3.2   employee because of personal reasons, and not directed against 
  3.3   the employee as an employee, or because of the employment. 
  3.4      Sec. 4.  Minnesota Statutes 1994, section 176.081, 
  3.5   subdivision 1, is amended to read: 
  3.6      Subdivision 1.  [APPROVAL.] (a) A fee for legal services of 
  3.7   25 percent of the first $4,000 of compensation awarded to the 
  3.8   employee and 20 percent of the next $60,000 of compensation 
  3.9   awarded to the employee is permissible and does not require 
  3.10  approval by the commissioner, compensation judge, or any other 
  3.11  party except as provided in paragraph (d).  All fees must be 
  3.12  calculated according to the formula under this subdivision, or 
  3.13  earned in hourly fees for representation at discontinuance 
  3.14  conferences under section 176.239, or earned in hourly fees for 
  3.15  representation on rehabilitation or medical issues under section 
  3.16  176.102, 176.135, or 176.136.  Attorney fees for recovery of 
  3.17  medical or rehabilitation benefits or services shall be assessed 
  3.18  against the employer or insurer if these fees exceed the 
  3.19  contingent fee under this section in connection with benefits 
  3.20  currently in dispute.  The amount of the fee that the employer 
  3.21  or insurer is liable for is the amount determined under 
  3.22  subdivision 5, minus the contingent fee. 
  3.23     (b) All fees for legal services related to the same injury 
  3.24  are cumulative and may not exceed $13,000, except as provided by 
  3.25  subdivision 2.  If multiple injuries are the subject of a 
  3.26  dispute, the commissioner, compensation judge, or court of 
  3.27  appeals shall specify the attorney fee attributable to each 
  3.28  injury. 
  3.29     (c) If the employer or the insurer or the defendant is 
  3.30  given written notice of claims for legal services or 
  3.31  disbursements, the claim shall be a lien against the amount paid 
  3.32  or payable as compensation.  In no case shall fees be calculated 
  3.33  on the basis of any undisputed portion of compensation awards.  
  3.34  Allowable fees under this chapter shall be based solely upon 
  3.35  genuinely disputed claims or portions of claims, including 
  3.36  disputes related to the payment of rehabilitation benefits or to 
  4.1   other aspects of a rehabilitation plan.  Fees for administrative 
  4.2   conferences under section 176.239 shall be determined on an 
  4.3   hourly basis, according to the criteria in subdivision 5.  
  4.4      (d) An attorney who is claiming legal fees for representing 
  4.5   an employee in a workers' compensation matter shall file a 
  4.6   statement of attorney fees with the commissioner, compensation 
  4.7   judge before whom the matter was heard, or workers' compensation 
  4.8   court of appeals on cases before the court.  A copy of the 
  4.9   signed retainer agreement shall also be filed.  The employee and 
  4.10  insurer shall receive a copy of the statement.  The statement 
  4.11  shall be on a form prescribed by the commissioner, shall report 
  4.12  the number of hours spent on the case, and shall clearly and 
  4.13  conspicuously state that the employee or insurer has ten 
  4.14  calendar days to object to the attorney fees requested.  If no 
  4.15  objection is timely made by the employee or insurer, the amount 
  4.16  requested shall be conclusively presumed reasonable providing 
  4.17  the amount does not exceed the limitation in subdivision 1.  The 
  4.18  commissioner, compensation judge, or court of appeals shall 
  4.19  issue an order granting the fees and the amount requested shall 
  4.20  be awarded to the party requesting the fee.  
  4.21     If a timely objection is filed, or the fee is determined on 
  4.22  an hourly basis, the commissioner, compensation judge, or court 
  4.23  of appeals shall review the matter and make a determination 
  4.24  based on the criteria in subdivision 5. 
  4.25     If no timely objection is made by an employer or insurer, 
  4.26  reimbursement under subdivision 7 shall be made if the statement 
  4.27  of fees requested this reimbursement. 
  4.28     (e) Employers and insurers may not pay attorney fees or 
  4.29  wages for legal services of more than $13,000 per case unless 
  4.30  the additional fees or wages are approved under subdivision 
  4.31  2.  The $13,000 limitation applies to fee awards on and after 
  4.32  July 1, 1992.  
  4.33     (f) Each insurer and self-insured employer shall file 
  4.34  annual statements with the commissioner detailing the total 
  4.35  amount of legal fees and other legal costs incurred by the 
  4.36  insurer or employer during the year.  The statement shall 
  5.1   include the amount paid for outside and in-house counsel, 
  5.2   deposition and other witness fees, and all other costs relating 
  5.3   to litigation. 
  5.4      Sec. 5.  Minnesota Statutes 1994, section 176.101, 
  5.5   subdivision 3a, is amended to read: 
  5.6      Subd. 3a.  [ECONOMIC RECOVERY COMPENSATION.] If an employee 
  5.7   is not eligible for an impairment award pursuant to subdivision 
  5.8   3b, then the employee shall receive economic recovery 
  5.9   compensation for a permanent partial disability pursuant to this 
  5.10  subdivision.  The compensation shall be 66-2/3 percent of the 
  5.11  weekly wage at the time of injury subject to ~~a~~ the maximum ~~equal~~ 
  5.12  ~~to the statewide average weekly wage~~ rate for temporary total 
  5.13  compensation.  For permanent partial disability up to the 
  5.14  percent of the whole body in the following schedule the 
  5.15  compensation shall be paid for the proportion that the loss of 
  5.16  function of the disabled part bears to the whole body multiplied 
  5.17  by the number of weeks aligned with that percent. 
  5.18         Percent of disability          Weeks of compensation 
  5.19                  0-25                            600 
  5.20                 26-30                            640 
  5.21                 31-35                            680 
  5.22                 36-40                            720 
  5.23                 41-45                            760 
  5.24                 46-50                            800 
  5.25                 51-55                            880 
  5.26                 56-60                            960 
  5.27                 61-65                           1040 
  5.28                 66-70                           1120 
  5.29                 71-100                          1200 
  5.30     The percentage loss in all cases under this subdivision is 
  5.31  determined according to the rules adopted by the commissioner 
  5.32  pursuant to section 176.105, subdivision 4.  This subdivision 
  5.33  applies to an injury which occurs on or after January 1, 1984.  
  5.34     Sec. 6.  Minnesota Statutes 1994, section 176.101, 
  5.35  subdivision 3i, is amended to read: 
  5.36     Subd. 3i.  [LAY OFF BECAUSE OF LACK OF WORK OR RELEASED FOR 
  6.1   OTHER THAN SEASONAL CONDITIONS.] (a) If an employee accepts a 
  6.2   job under subdivision 3e and begins work at that job and is 
  6.3   subsequently unemployed at that job because of economic 
  6.4   conditions, other than seasonal conditions, the employee shall 
  6.5   receive monitoring period compensation pursuant to clause (b).  
  6.6   In addition, the employer who was the employer at the time of 
  6.7   the injury shall provide rehabilitation consultation by a 
  6.8   qualified rehabilitation consultant if the employee remains 
  6.9   unemployed for 45 calendar days.  The commissioner may waive 
  6.10  this rehabilitation consultation if the commissioner deems it 
  6.11  appropriate.  Further rehabilitation, if deemed appropriate, is 
  6.12  governed by section 176.102.  
  6.13     (b) Upon the employee's initial return to work the 
  6.14  monitoring period begins to run.  If the employee is unemployed 
  6.15  for the reason in clause (a), prior to the end of the monitoring 
  6.16  period the employee shall receive monitoring period 
  6.17  compensation.  This compensation shall be paid until (1) the 
  6.18  monitoring period expires, or (2) the sum of monitoring period 
  6.19  compensation paid and impairment compensation paid or payable is 
  6.20  equal to the amount of economic recovery compensation that would 
  6.21  have been paid if that compensation were payable, whichever 
  6.22  occurs first.  No monitoring period compensation is payable if 
  6.23  the unemployment occurs after the expiration of the monitoring 
  6.24  period.  Monitoring period compensation is payable at the same 
  6.25  intervals and at the same rate as when temporary total 
  6.26  compensation ceased, provided that the minimum monitoring period 
  6.27  compensation rate is 66-2/3 percent of the weekly wage for 
  6.28  permanent partial disability as determined by section 176.011, 
  6.29  subdivision 18 and subject to the maximums specified therein.  
  6.30     (c) Compensation under this subdivision shall not be 
  6.31  escalated pursuant to section 176.645.  
  6.32     (d) If the employee returns to work and is still receiving 
  6.33  monitoring period compensation, this compensation shall cease. 
  6.34  Any period remaining in the monitoring period upon this return 
  6.35  to work shall be used to determine further benefits if the 
  6.36  employee is again unemployed under clause (a).  
  7.1      (e) Upon the employee's return to work pursuant to this 
  7.2   section the insurer shall notify the employee of the length of 
  7.3   the employee's monitoring period and shall notify the employee 
  7.4   of the amount of impairment to be paid and the date of payment.  
  7.5      (f) If an employee relocates within the meaning of section 
  7.6   176.102, subdivision 9, paragraph (a), clause (5), in order to 
  7.7   accept a job offered as a suitable job under subdivision 3e, any 
  7.8   monitoring period compensation due under paragraph (b) is 
  7.9   payable for twice the number of weeks otherwise due or until the 
  7.10  employee returns to work, whichever occurs first.  If the 
  7.11  monitoring period compensation calculated under this paragraph 
  7.12  following a relocation and layoff would be payable for less than 
  7.13  26 weeks, monitoring period compensation is nevertheless payable 
  7.14  for 26 weeks following the layoff or until the employee returns 
  7.15  to work, whichever occurs first. 
  7.16     Sec. 7.  Minnesota Statutes 1994, section 176.102, 
  7.17  subdivision 11, is amended to read: 
  7.18     Subd. 11.  [RETRAINING; COMPENSATION.] (a) Retraining is 
  7.19  limited to 156 weeks.  An employee who has been approved for 
  7.20  retraining may petition the commissioner or compensation judge 
  7.21  for additional compensation not to exceed 25 percent of the 
  7.22  compensation otherwise payable.  If the commissioner or 
  7.23  compensation judge determines that this additional compensation 
  7.24  is warranted due to unusual or unique circumstances of the 
  7.25  employee's retraining plan, the commissioner may award 
  7.26  additional compensation in an amount not to exceed the 
  7.27  employee's request.  This additional compensation shall cease at 
  7.28  any time the commissioner or compensation judge determines the 
  7.29  special circumstances are no longer present.  
  7.30     (b) If the employee is not employed during a retraining 
  7.31  plan that has been specifically approved under this section, 
  7.32  temporary total compensation is payable for up to 90 days after 
  7.33  the end of the retraining plan~~; except that, payment during the~~ 
  7.34  ~~90-day period is subject to cessation in accordance with section~~ 
  7.35  ~~176.101~~.  If the employee is employed during the retraining plan 
  7.36  but earning less than at the time of injury, temporary partial 
  8.1   compensation is payable at the rate of 66-2/3 percent of the 
  8.2   difference between the employee's weekly wage at the time of 
  8.3   injury and the weekly wage the employee is able to earn in the 
  8.4   employee's partially disabled condition, subject to the maximum 
  8.5   rate for temporary total compensation.  Temporary partial 
  8.6   compensation is not subject to the 225-week or 450-week 
  8.7   limitations provided by section 176.101, subdivision 2, during 
  8.8   the retraining plan, but is subject to those limitations before 
  8.9   and after the plan. 
  8.10     Sec. 8.  Minnesota Statutes 1994, section 176.103, 
  8.11  subdivision 2, is amended to read: 
  8.12     Subd. 2.  [SCOPE.] The commissioner shall monitor the 
  8.13  medical and surgical treatment provided to injured employees, 
  8.14  the services of other health care providers and shall also 
  8.15  monitor hospital utilization as it relates to the treatment of 
  8.16  injured employees.  This monitoring shall include determinations 
  8.17  concerning the appropriateness of the service, whether the 
  8.18  treatment is necessary and effective, the proper cost of 
  8.19  services, the quality of the treatment, the right of providers 
  8.20  to receive payment under this chapter for services rendered or 
  8.21  the right to receive payment under this chapter for future 
  8.22  services.  Insurers and self-insurers must assist the 
  8.23  commissioner in this monitoring by reporting to the commissioner 
  8.24  cases of suspected excessive, inappropriate, or unnecessary 
  8.25  treatment.  ~~The commissioner shall report specific cases of~~ 
  8.26  ~~suspected inappropriate, unnecessary, and excessive treatment to~~ 
  8.27  ~~the medical services review board.  The medical services review~~ 
  8.28  ~~board shall review those cases and make a determination of~~ 
  8.29  ~~whether there is inappropriate, unnecessary, or excessive~~ 
  8.30  ~~treatment based on rules adopted by the commissioner in~~ 
  8.31  ~~consultation with the medical services review board.  The~~ 
  8.32  ~~determination of the board is not subject to the contested case~~ 
  8.33  ~~provisions of the administrative procedure act in chapter 14.~~  
  8.34  ~~An affected provider shall be given notice and an opportunity to~~ 
  8.35  ~~be heard before the board prior to the board reporting its~~ 
  8.36  ~~findings and conclusions.  The board shall report its findings~~ 
  9.1   ~~and conclusions to the commissioner.  The findings and~~ 
  9.2   ~~conclusions of the board are binding on the commissioner.  The~~ 
  9.3   ~~commissioner shall order a sanction if the board has concluded~~ 
  9.4   ~~there was inappropriate, unnecessary, or excessive treatment.~~  
  9.5   The commissioner in consultation with the medical services 
  9.6   review board shall adopt rules defining standards of treatment 
  9.7   including inappropriate, unnecessary, or excessive treatment and 
  9.8   the sanctions to be imposed for inappropriate, unnecessary, or 
  9.9   excessive treatment.  The sanctions imposed may include, without 
  9.10  limitation, a warning, a restriction on providing treatment, 
  9.11  requiring preauthorization by the board for a plan of treatment, 
  9.12  and suspension from receiving compensation for the provision of 
  9.13  treatment under chapter 176.  The commissioner's authority under 
  9.14  this section also includes the authority to make determinations 
  9.15  regarding any other activity involving the questions of 
  9.16  utilization of medical services, and any other determination the 
  9.17  commissioner deems necessary for the proper administration of 
  9.18  this section, but does not include the authority to make the 
  9.19  initial determination of primary liability, except as provided 
  9.20  by section 176.305. 
  9.21     Sec. 9.  Minnesota Statutes 1994, section 176.103, 
  9.22  subdivision 3, is amended to read: 
  9.23     Subd. 3.  [MEDICAL SERVICES REVIEW BOARD; SELECTION; 
  9.24  POWERS.] (a) There is created a medical services review board 
  9.25  composed of the commissioner or the commissioner's designee as 
  9.26  an ex officio member, two persons representing chiropractic, one 
  9.27  person representing hospital administrators, one physical 
  9.28  therapist, and six physicians representing different specialties 
  9.29  which the commissioner determines are the most frequently 
  9.30  utilized by injured employees.  The board shall also have one 
  9.31  person representing employees, one person representing employers 
  9.32  or insurers, and one person representing the general public.  
  9.33  The members shall be appointed by the commissioner and shall be 
  9.34  governed by section 15.0575.  Terms of the board's members may 
  9.35  be renewed.  The board may appoint from its members whatever 
  9.36  subcommittees it deems appropriate.  
 10.1      The commissioner may appoint alternates for one-year terms 
 10.2   to serve as a member when a member is unavailable.  The number 
 10.3   of alternates shall not exceed one chiropractor, one physical 
 10.4   therapist, one hospital administrator, three physicians, one 
 10.5   employee representative, one employer or insurer representative, 
 10.6   and one representative of the general public. 
 10.7      The board shall review clinical results for adequacy and 
 10.8   recommend to the commissioner scales for disabilities and 
 10.9   apportionment.  
 10.10     The board shall review and recommend to the commissioner 
 10.11  rates for individual clinical procedures and aggregate costs.  
 10.12  The board shall assist the commissioner in accomplishing public 
 10.13  education.  
 10.14     In evaluating the clinical consequences of the services 
 10.15  provided to an employee by a clinical health care provider, the 
 10.16  board shall consider the following factors in the priority 
 10.17  listed:  
 10.18     (1) the clinical effectiveness of the treatment; 
 10.19     (2) the clinical cost of the treatment; and 
 10.20     (3) the length of time of treatment.  
 10.21     The board shall advise the commissioner on the adoption of 
 10.22  rules regarding all aspects of medical care and services 
 10.23  provided to injured employees.  
 10.24     (b) The medical services review board may upon petition 
 10.25  from the commissioner and after hearing, issue a warning, a 
 10.26  penalty of $200 per violation, a restriction on providing 
 10.27  treatment that requires preauthorization by the board, 
 10.28  commissioner, or compensation judge for a plan of treatment, 
 10.29  disqualify, or suspend a provider from receiving payment for 
 10.30  services rendered under this chapter if a provider has violated 
 10.31  any part of this chapter or rule adopted under this chapter, or 
 10.32  where there has been a pattern of, or an egregious case of, 
 10.33  inappropriate, unnecessary, or excessive treatment by a provider.
 10.34  The hearings are initiated by the commissioner under the 
 10.35  contested case procedures of chapter 14.  The board shall make 
 10.36  the final decision following receipt of the recommendation of 
 11.1   the administrative law judge.  The board's decision is 
 11.2   appealable to the workers' compensation court of appeals in the 
 11.3   manner provided by section 176.421. 
 11.4      (c) The board may adopt rules of procedure.  The rules may 
 11.5   be joint rules with the rehabilitation review panel.  
 11.6      Sec. 10.  Minnesota Statutes 1994, section 176.104, 
 11.7   subdivision 1, is amended to read: 
 11.8      Subdivision 1.  [DISPUTE.] If there exists a dispute 
 11.9   regarding medical causation or whether an injury arose out of 
 11.10  and in the course and scope of employment and an employee ~~has~~ 
 11.11  ~~been disabled for the requisite time under section 176.102,~~ 
 11.12  ~~subdivision 4,~~ is otherwise eligible for rehabilitation services 
 11.13  under section 176.102 prior to determination of liability, the 
 11.14  employee shall be referred by the commissioner to the 
 11.15  department's vocational rehabilitation unit which shall provide 
 11.16  rehabilitation consultation if appropriate.  The services 
 11.17  provided by the department's vocational rehabilitation unit and 
 11.18  the scope and term of the rehabilitation are governed by section 
 11.19  176.102 and rules adopted pursuant to that section.  
 11.20  Rehabilitation costs and services under this subdivision shall 
 11.21  be monitored by the commissioner. 
 11.22     Sec. 11.  Minnesota Statutes 1994, section 176.106, 
 11.23  subdivision 7, is amended to read: 
 11.24     Subd. 7.  [REQUEST FOR HEARING.] Any party aggrieved by the 
 11.25  decision of the commissioner may request a formal hearing by 
 11.26  filing the request with the commissioner and serving the request 
 11.27  on all parties no later than 30 days after the decision.  The 
 11.28  request shall be referred to the office of administrative 
 11.29  hearings for a de novo hearing before a compensation 
 11.30  judge.  Except where the only issues to be determined pursuant 
 11.31  to this section involve liability for past treatment or services 
 11.32  that will not affect entitlement to ongoing or future proposed 
 11.33  treatment or services under section 176.102 or 176.135, the 
 11.34  commissioner shall refer a timely request to the office of 
 11.35  administrative hearings within five working days after filing of 
 11.36  the request and the hearing at the office of administrative 
 12.1   hearings must be held on the first date that all parties are 
 12.2   available but not later than 60 days after the office of 
 12.3   administrative hearings receives the matter. Following the 
 12.4   hearing, the compensation judge must issue the decision within 
 12.5   30 days.  The decision of the compensation judge is appealable 
 12.6   pursuant to section 176.421. 
 12.7      Sec. 12.  [176.107] [TELECONFERENCES.] 
 12.8      The division, department, office, or the court of appeals 
 12.9   may, at its discretion, conduct mediation sessions, 
 12.10  administrative conferences, settlement conferences, or hearings 
 12.11  as provided in this chapter in person, by telephone, or by 
 12.12  visual or audio teleconferencing methods. 
 12.13     Sec. 13.  Minnesota Statutes 1994, section 176.129, 
 12.14  subdivision 9, is amended to read: 
 12.15     Subd. 9.  [POWERS OF FUND.] In addition to powers granted 
 12.16  to the special compensation fund by this chapter the fund may do 
 12.17  the following:  
 12.18     (a) sue and be sued in its own name; 
 12.19     (b) intervene in or commence an action under this chapter 
 12.20  or any other law, including, but not limited to, intervention or 
 12.21  action as a subrogee to the division's right in a third-party 
 12.22  action, any proceeding under this chapter in which liability of 
 12.23  the special compensation fund is an issue, or any proceeding 
 12.24  which may result in other liability of the fund or to protect 
 12.25  the legal right of the fund; 
 12.26     (c) enter into settlements including but not limited to 
 12.27  structured, annuity purchase agreements with appropriate parties 
 12.28  under this chapter~~;~~.  Notwithstanding any other provision of 
 12.29  this chapter, any settlement may provide that the fund partially 
 12.30  or totally denies liability for payment of benefits, and no 
 12.31  determination of employer insurance status and liability under 
 12.32  section 176.183, subdivision 2, shall be required for approval 
 12.33  of the stipulation for a settlement; 
 12.34     (d) contract with another party to administer the special 
 12.35  compensation fund; 
 12.36     (e) take any other action which an insurer is permitted by 
 13.1   law to take in operating within this chapter; and 
 13.2      (f) conduct a financial audit of indemnity claim payments 
 13.3   and assessments reported to the fund.  This may be contracted by 
 13.4   the fund to a private auditing firm. 
 13.5      Sec. 14.  Minnesota Statutes 1994, section 176.1351, 
 13.6   subdivision 1, is amended to read: 
 13.7      Subdivision 1.  [APPLICATION.] Any person or entity, other 
 13.8   than a workers' compensation insurer or an employer for its own 
 13.9   employees, may make written application to the commissioner to 
 13.10  have a plan certified that provides management of quality 
 13.11  treatment to injured workers for injuries and diseases 
 13.12  compensable under this chapter.  Specifically, and without 
 13.13  limitation, an entity licensed under chapter 62C or 62D or a 
 13.14  preferred provider organization that is subject to chapter 72A 
 13.15  is eligible for certification under this section.  Each 
 13.16  application for certification shall be accompanied by a 
 13.17  reasonable fee prescribed by the commissioner which shall be 
 13.18  deposited in the special compensation fund.  A plan may be 
 13.19  certified to provide services in a limited geographic area.  A 
 13.20  certificate is valid for the period the commissioner prescribes 
 13.21  unless revoked or suspended.  Application for certification 
 13.22  shall be made in the form and manner and shall set forth 
 13.23  information regarding the proposed plan for providing services 
 13.24  as the commissioner may prescribe.  The information shall 
 13.25  include, but not be limited to: 
 13.26     (1) a list of the names of all health care providers who 
 13.27  will provide services under the managed care plan, together with 
 13.28  appropriate evidence of compliance with any licensing or 
 13.29  certification requirements for those providers to practice in 
 13.30  this state; and 
 13.31     (2) a description of the places and manner of providing 
 13.32  services under the plan. 
 13.33     Sec. 15.  Minnesota Statutes 1994, section 176.1351, 
 13.34  subdivision 5, is amended to read: 
 13.35     Subd. 5.  [REVOCATION, SUSPENSION, AND REFUSAL TO CERTIFY; 
 13.36  PENALTIES AND ENFORCEMENT.] (a) The commissioner shall refuse to 
 14.1   certify or shall revoke or suspend the certification of a 
 14.2   managed care plan if the commissioner finds that the plan for 
 14.3   providing medical or health care services fails to meet the 
 14.4   requirements of this section, or service under the plan is not 
 14.5   being provided in accordance with the terms of a certified plan. 
 14.6      (b) In lieu of or in addition to suspension or revocation 
 14.7   under paragraph (a), the commissioner may, for any noncompliance 
 14.8   with the managed care plan as certified or any violation of a 
 14.9   statute or rule applicable to a managed care plan, assess an 
 14.10  administrative penalty payable to the special compensation fund 
 14.11  in an amount up to $25,000 for each violation or incidence of 
 14.12  noncompliance.  In determining the level of an administrative 
 14.13  penalty, the commissioner shall consider the following factors: 
 14.14     (1) the number of workers affected or potentially affected 
 14.15  by the violation or noncompliance; 
 14.16     (2) the effect or potential effect of the violation or 
 14.17  noncompliance on workers' health, access to health services, or 
 14.18  workers' compensation benefits; 
 14.19     (3) the effect or potential effect of the violation or 
 14.20  noncompliance on workers' understanding of their rights and 
 14.21  obligations under the workers' compensation law and rules; 
 14.22     (4) whether the violation or noncompliance is an isolated 
 14.23  incident or part of a pattern of violations; and 
 14.24     (5) the potential or actual economic benefits derived by 
 14.25  the managed care plan or a participating provider by virtue of 
 14.26  the violation or noncompliance. 
 14.27     The commissioner shall give written notice to the managed 
 14.28  care plan of the penalty assessment and the reasons for the 
 14.29  penalty.  The managed care plan has 30 days from the date the 
 14.30  penalty notice is issued within which to file a written request 
 14.31  for an administrative hearing and review of the commissioner's 
 14.32  determination pursuant to section 176.85, subdivision 1. 
 14.33     (c) If the commissioner, for any reason, has cause to 
 14.34  believe that a managed care plan has or may violate a statute or 
 14.35  rule or a provision of the managed care plan as certified, the 
 14.36  commissioner may, before commencing action under paragraph (a) 
 15.1   or (b), call a conference with the managed care plan and other 
 15.2   persons who may be involved in the suspected violation or 
 15.3   noncompliance for the purpose of ascertaining the facts relating 
 15.4   to the suspected violation or noncompliance and arriving at an 
 15.5   adequate and effective means of correcting or preventing the 
 15.6   violation or noncompliance.  The commissioner may enter into 
 15.7   stipulated consent agreements with the managed care plan for 
 15.8   corrective or preventive action or the amount of the penalty to 
 15.9   be paid.  Proceedings under this paragraph shall not be governed 
 15.10  by any formal procedural requirements, and may be conducted in a 
 15.11  manner the commissioner deems appropriate under the 
 15.12  circumstances. 
 15.13     (d) The commissioner may issue an order directing a managed 
 15.14  care plan or a representative of a managed care plan to cease 
 15.15  and desist from engaging in any act or practice that is not in 
 15.16  compliance with the managed care plan as certified, or that it 
 15.17  is in violation of an applicable statute or rule.  Within 30 
 15.18  days of service of the order, the managed care plan may request 
 15.19  review of the cease and desist order by an administrative law 
 15.20  judge pursuant to chapter 14.  The decision of the 
 15.21  administrative law judge shall include findings of fact, 
 15.22  conclusions of law and appropriate orders, which shall be the 
 15.23  final decision of the commissioner.  In the event of 
 15.24  noncompliance with a cease and desist order, the commissioner 
 15.25  may institute a proceeding in district court to obtain 
 15.26  injunctive or other appropriate relief. 
 15.27     (e) A managed care plan, participating health care 
 15.28  provider, or an employer or insurer that receives services from 
 15.29  the managed care plan, shall cooperate fully with an 
 15.30  investigation by the commissioner.  For purposes of this 
 15.31  section, cooperation includes, but is not limited to, attending 
 15.32  a conference called by the commissioner under paragraph (c), 
 15.33  responding fully and promptly to any questions relating to the 
 15.34  subject of the investigation, and providing copies of records, 
 15.35  reports, logs, data, and other information requested by the 
 15.36  commissioner to assist in the investigation.  
 16.1      (f) Any person acting on behalf of a managed care plan who 
 16.2   violates or knowingly submits false information in any report 
 16.3   required to be filed by a managed care plan is guilty of a 
 16.4   misdemeanor. 
 16.5      Sec. 16.  Minnesota Statutes 1994, section 176.136, 
 16.6   subdivision 1a, is amended to read: 
 16.7      Subd. 1a.  [RELATIVE VALUE FEE SCHEDULE.] The liability of 
 16.8   an employer for services included in the medical fee schedule is 
 16.9   limited to the maximum fee allowed by the schedule in effect on 
 16.10  the date of the medical service, or the provider's actual fee, 
 16.11  whichever is lower.  The medical fee schedule effective on 
 16.12  October 1, 1991, shall remain in effect until the commissioner 
 16.13  adopts a new schedule by permanent rule.  The commissioner shall 
 16.14  adopt permanent rules regulating fees allowable for medical, 
 16.15  chiropractic, podiatric, surgical, and other health care 
 16.16  provider treatment or service, including those provided to 
 16.17  hospital outpatients, by implementing a relative value fee 
 16.18  schedule to be effective on October 1, 1993.  The commissioner 
 16.19  may adopt by reference the relative value fee schedule adopted 
 16.20  for the federal Medicare program or a relative value fee 
 16.21  schedule adopted by other federal or state agencies.  The 
 16.22  relative value fee schedule shall contain reasonable 
 16.23  classifications including, but not limited to, classifications 
 16.24  that differentiate among health care provider disciplines.  The 
 16.25  conversion factors for the original relative value fee schedule 
 16.26  must reasonably reflect a 15 percent overall reduction from the 
 16.27  medical fee schedule most recently in effect.  The reduction 
 16.28  need not be applied equally to all treatment or services, but 
 16.29  must represent a gross 15 percent reduction. 
 16.30     After permanent rules have been adopted to implement this 
 16.31  section, the conversion factors must be adjusted annually on 
 16.32  October 1 by no more than the percentage change computed under 
 16.33  section 176.645, but without the annual cap provided by that 
 16.34  section.  The commissioner shall annually give notice in the 
 16.35  State Register of the adjusted conversion factors and of any 
 16.36  additional relative value units or changes to the relative value 
 17.1   units adopted by the federal Medicare program.  Modifications to 
 17.2   the federal relative value units may be made in the same manner 
 17.3   as modifications to the original workers' compensation relative 
 17.4   value fee schedule.  This notice of the additional conversion 
 17.5   factors and additional relative value units as modified shall be 
 17.6   in lieu of the requirements of chapter 14. 
 17.7      Sec. 17.  Minnesota Statutes 1994, section 176.136, 
 17.8   subdivision 1b, is amended to read: 
 17.9      Subd. 1b.  [LIMITATION OF LIABILITY.] (a) The liability of 
 17.10  the employer for treatment, articles, and supplies provided to 
 17.11  an employee while an inpatient or outpatient at a small hospital 
 17.12  shall be the hospital's usual and customary charge, unless the 
 17.13  charge is determined by the commissioner or a compensation judge 
 17.14  to be unreasonably excessive.  A "small hospital," for purposes 
 17.15  of this paragraph, is a hospital which has 100 or fewer licensed 
 17.16  beds. 
 17.17     (b) The liability of the employer for the treatment, 
 17.18  articles, and supplies that are not limited by subdivision 1a or 
 17.19  1c or paragraph (a) shall be limited to 85 percent of the 
 17.20  provider's usual and customary charge, or 85 percent of the 
 17.21  prevailing charges for similar treatment, articles, and supplies 
 17.22  furnished to an injured person when paid for by the injured 
 17.23  person, whichever is lower.  On this basis, the commissioner or 
 17.24  compensation judge may determine the reasonable value of all 
 17.25  treatment, services, and supplies, and the liability of the 
 17.26  employer is limited to that amount.  The commissioner may by 
 17.27  rule establish the reasonable value of a service, article, or 
 17.28  supply in lieu of the 85 percent limitation in this paragraph. 
 17.29     (c) The limitation of liability for charges provided by 
 17.30  paragraph (b) does not apply to a nursing home that participates 
 17.31  in the medical assistance program and whose rates are 
 17.32  established by the commissioner of human services. 
 17.33     Sec. 18.  Minnesota Statutes 1994, section 176.136, 
 17.34  subdivision 2, is amended to read: 
 17.35     Subd. 2.  [EXCESSIVE FEES.] If the employer or insurer 
 17.36  determines that the charge for a health service or medical 
 18.1   service is excessive, no payment in excess of the reasonable 
 18.2   charge for that service shall be made under this chapter nor may 
 18.3   the provider collect or attempt to collect from the injured 
 18.4   employee or any other insurer or government amounts in excess of 
 18.5   the amount payable under this chapter unless the commissioner, 
 18.6   compensation judge, or court of appeals determines otherwise.  
 18.7   In such a case, the health care provider may initiate an action 
 18.8   under this chapter for recovery of the amounts deemed excessive 
 18.9   by the employer or insurer~~, but the employer or insurer shall~~ 
 18.10  ~~have the burden of proving excessiveness~~.  
 18.11     A charge for a health service or medical service is 
 18.12  excessive if it: 
 18.13     (1) exceeds the maximum permissible charge pursuant to 
 18.14  subdivision 1, 1a, 1b, or 1c; 
 18.15     (2) is for a service provided at a level, duration, or 
 18.16  frequency that is excessive, based upon accepted medical 
 18.17  standards for quality health care and accepted rehabilitation 
 18.18  standards; 
 18.19     (3) is for a service that is outside the scope of practice 
 18.20  of the particular provider or is not generally recognized within 
 18.21  the particular profession of the provider as of therapeutic 
 18.22  value for the specific injury or condition treated; or 
 18.23     (4) is otherwise deemed excessive or inappropriate pursuant 
 18.24  to rules adopted pursuant to this chapter.  
 18.25     Sec. 19.  Minnesota Statutes 1994, section 176.138, is 
 18.26  amended to read: 
 18.27     176.138 [MEDICAL DATA; ACCESS.] 
 18.28     (a) Notwithstanding any other state laws related to the 
 18.29  privacy of medical data or any private agreements to the 
 18.30  contrary, the release in writing, by telephone discussion, or 
 18.31  otherwise of medical data related to a current claim for 
 18.32  compensation under this chapter to the employee, employer, or 
 18.33  insurer who are parties to the claim, or to the department of 
 18.34  labor and industry, shall not require prior approval of any 
 18.35  party to the claim.  This section does not preclude the release 
 18.36  of medical data under section 175.10 or 176.231, subdivision 9.  
 19.1   Requests for pertinent data shall be made, and the date of 
 19.2   discussions with medical providers about medical data shall be 
 19.3   confirmed, in writing to the person or organization that 
 19.4   collected or currently possesses the data.  Written medical data 
 19.5   that exists at the time the request is made shall be provided by 
 19.6   the collector or possessor within seven working days of 
 19.7   receiving the request.  Nonwritten medical data may be provided, 
 19.8   but is not required to be provided, by the collector or 
 19.9   possessor.  In all cases of a request for the data or discussion 
 19.10  with a medical provider about the data, except when it is the 
 19.11  employee who is making the request, the employee shall be sent 
 19.12  written notification of the request by the party requesting the 
 19.13  data at the same time the request is made or a written 
 19.14  confirmation of the discussion.  This data shall be treated as 
 19.15  private data by the party who requests or receives the data and 
 19.16  the party receiving the data shall provide the employee or the 
 19.17  employee's attorney with a copy of all data requested by the 
 19.18  requester.  
 19.19     (b) Medical data which is not directly related to a current 
 19.20  injury or disability shall not be released without prior 
 19.21  authorization of the employee. 
 19.22     (c) The commissioner may impose a penalty of up to $200 
 19.23  payable to the assigned risk safety account against a party who 
 19.24  does not timely release data as required in this section.  A 
 19.25  party who does not treat this data as private pursuant to this 
 19.26  section is guilty of a misdemeanor.  This paragraph applies only 
 19.27  to written medical data which exists at the time the request is 
 19.28  made.  
 19.29     (d) Workers' compensation insurers and self-insured 
 19.30  employers may, for the sole purpose of identifying duplicate 
 19.31  billings submitted to more than one insurer, disclose to health 
 19.32  insurers, including all insurers writing insurance described in 
 19.33  section 60A.06, subdivision 1, clause (5)(a), nonprofit health 
 19.34  service plan corporations subject to chapter 62C, health 
 19.35  maintenance organizations subject to chapter 62D, and joint 
 19.36  self-insurance employee health plans subject to chapter 62H, 
 20.1   computerized information about dates, coded items, and charges 
 20.2   for medical treatment of employees and other medical billing 
 20.3   information submitted to them by an employee, employer, health 
 20.4   care provider, or other insurer in connection with a current 
 20.5   claim for compensation under this chapter, without prior 
 20.6   approval of any party to the claim.  The data may not be used by 
 20.7   the health insurer for any other purpose whatsoever and must be 
 20.8   destroyed after verification that there has been no duplicative 
 20.9   billing.  Any person who is the subject of the data which is 
 20.10  used in a manner not allowed by this ~~section~~ paragraph has a 
 20.11  cause of action for actual damages and punitive damages for a 
 20.12  minimum of $5,000. 
 20.13     Sec. 20.  Minnesota Statutes 1994, section 176.178, is 
 20.14  amended to read: 
 20.15     176.178 [FRAUD.] 
 20.16     Subdivision 1.  [INTENT.] Any person who, with intent to 
 20.17  defraud, receives workers' compensation benefits to which the 
 20.18  person is not entitled by knowingly misrepresenting, misstating, 
 20.19  or failing to disclose any material fact is guilty of theft and 
 20.20  shall be sentenced pursuant to section 609.52, subdivision 3. 
 20.21     Subd. 2.  [FORMS.] The text of subdivision 1 shall be 
 20.22  placed on all forms prescribed by the commissioner for claims or 
 20.23  responses to claims for workers' compensation benefits under 
 20.24  this chapter.  The absence of the text does not constitute a 
 20.25  defense against prosecution under subdivision 1.  
 20.26     Sec. 21.  Minnesota Statutes 1994, section 176.181, 
 20.27  subdivision 8, is amended to read: 
 20.28     Subd. 8.  [DATA SHARING.] (a) The departments of labor and 
 20.29  industry, economic security, human services, agriculture, 
 20.30  transportation, and revenue are authorized to share information 
 20.31  regarding the employment status of individuals, including but 
 20.32  not limited to payroll and withholding and income tax 
 20.33  information, and may use that information for purposes 
 20.34  consistent with this section and regarding the employment or 
 20.35  employer status of individuals, partnerships, limited liability 
 20.36  companies, corporations, or employers, including, but not 
 21.1   limited to, general contractors, intermediate contractors, and 
 21.2   subcontractors.  The commissioner shall request data in writing 
 21.3   and the responding department shall respond to the request by 
 21.4   producing the requested data within 30 days. 
 21.5      (b) The commissioner is authorized to inspect and to order 
 21.6   the production of all payroll and other business records and 
 21.7   documents of any alleged employer in order to determine the 
 21.8   employment status of persons and compliance with this section.  
 21.9   If any person or employer refuses to comply with such an order, 
 21.10  the commissioner may apply to the district court of the county 
 21.11  where the person or employer is located for an order compelling 
 21.12  production of the documents. 
 21.13     Sec. 22.  Minnesota Statutes 1994, section 176.183, 
 21.14  subdivision 1, is amended to read: 
 21.15     Subdivision 1.  When any employee sustains an injury 
 21.16  arising out of and in the course of employment while in the 
 21.17  employ of an employer, other than the state or its political 
 21.18  subdivisions, not insured or self-insured as provided for in 
 21.19  this chapter, the employee or the employee's dependents shall 
 21.20  nevertheless receive benefits as provided for in this chapter 
 21.21  from the special compensation fund.  As used in subdivision 1 or 
 21.22  2, "employer" includes any owners or officers of a corporation 
 21.23  who direct and control the activities of employees.  In any 
 21.24  petition for benefits under this chapter, the naming of an 
 21.25  employer corporation not insured or self-insured as provided for 
 21.26  in this chapter, as a defendant, shall constitute without more 
 21.27  the naming of the owners or officers as defendants, and service 
 21.28  of notice of proceeding under this chapter on the corporation 
 21.29  shall constitute service upon the owners or officers.  An action 
 21.30  to recover benefits paid shall be instituted unless the 
 21.31  commissioner determines that no recovery is possible.  There 
 21.32  shall be no payment from the special compensation fund if there 
 21.33  is liability for the injury under the provisions of section 
 21.34  176.215, by an insurer or self-insurer. 
 21.35     Sec. 23.  Minnesota Statutes 1994, section 176.183, 
 21.36  subdivision 2, is amended to read: 
 22.1      Subd. 2.  After a hearing on a petition for benefits and 
 22.2   prior to issuing an order against the special compensation fund 
 22.3   to pay compensation benefits to an employee, a compensation 
 22.4   judge shall first make findings regarding the insurance status 
 22.5   of the employer and its liability.  The special compensation 
 22.6   fund shall not be found liable in the absence of a finding of 
 22.7   liability against the employer.  Where the liable employer is 
 22.8   found after the hearing to be not insured or self-insured as 
 22.9   provided for in this chapter, the compensation judge shall 
 22.10  assess and order the employer to pay all compensation benefits 
 22.11  to which the employee is entitled, the amount for actual and 
 22.12  necessary disbursements expended by the special compensation 
 22.13  fund, and a penalty in the amount of 60 percent of all 
 22.14  compensation benefits ordered to be paid.  ~~An~~ The award issued 
 22.15  against an employer after the hearing shall constitute a lien 
 22.16  for government services pursuant to section 514.67 on all 
 22.17  property of the employer and shall be subject to the provisions 
 22.18  of the revenue recapture act in chapter 270A.  The special 
 22.19  compensation fund may enforce the terms of that award in the 
 22.20  same manner as a district court judgment.  The commissioner of 
 22.21  labor and industry, in accordance with the terms of the order 
 22.22  awarding compensation, shall pay compensation to the employee or 
 22.23  the employee's dependent from the special compensation fund.  
 22.24  The commissioner of labor and industry shall certify to the 
 22.25  commissioner of finance and to the legislature annually the 
 22.26  total amount of compensation paid from the special compensation 
 22.27  fund under subdivision 1.  The commissioner of finance shall 
 22.28  upon proper certification reimburse the special compensation 
 22.29  fund from the general fund appropriation provided for this 
 22.30  purpose.  The amount reimbursed shall be limited to the 
 22.31  certified amount paid under this section or the appropriation 
 22.32  made for this purpose, whichever is the lesser amount.  
 22.33  Compensation paid under this section which is not reimbursed by 
 22.34  the general fund shall remain a liability of the special 
 22.35  compensation fund and shall be financed by the percentage 
 22.36  assessed under section 176.129. 
 23.1      Sec. 24.  Minnesota Statutes 1994, section 176.185, 
 23.2   subdivision 1, is amended to read: 
 23.3      Subdivision 1.  [NOTICE OF COVERAGE, TERMINATION, 
 23.4   CANCELLATION.] (a) Within ten days after the issuance of a 
 23.5   policy of insurance covering the liability to pay compensation 
 23.6   under this chapter written by an insurer licensed to insure such 
 23.7   liability in this state, the insurer shall file notice of 
 23.8   coverage with the commissioner under rules and on forms 
 23.9   prescribed by the commissioner.  No policy shall be canceled by 
 23.10  the insurer within the policy period nor terminated upon its 
 23.11  expiration date until a notice in writing is delivered or mailed 
 23.12  to the insured and filed with the commissioner, fixing the date 
 23.13  on which it is proposed to cancel it, or declaring that the 
 23.14  insurer does not intend to renew the policy upon the expiration 
 23.15  date.  A cancellation or termination is not effective until 30 
 23.16  days after written notice has been filed with the commissioner 
 23.17  in a manner prescribed by the commissioner unless prior to the 
 23.18  expiration of the 30-day period the employer obtains other 
 23.19  insurance coverage or an order exempting the employer from 
 23.20  carrying insurance as provided in section 176.181.  Upon receipt 
 23.21  of the notice, the commissioner shall notify the insured that 
 23.22  the insured must obtain coverage from some other licensed 
 23.23  carrier and that, if unable to do so, the insured shall request 
 23.24  the commissioner of commerce to require the issuance of a policy 
 23.25  as provided in section 79.251, subdivision 4.  Upon a 
 23.26  cancellation or termination of a policy by the insurer, the 
 23.27  employer is entitled to be assigned a policy in accordance with 
 23.28  sections 79.251 and 79.252.  
 23.29     (b) Notice of cancellation or termination by the insured 
 23.30  shall be served upon the insurer by written statement mailed or 
 23.31  delivered to the insurer.  Upon receipt of the notice, the 
 23.32  insurer shall notify the commissioner of the cancellation or 
 23.33  termination and the commissioner shall ask the employer for the 
 23.34  reasons for the cancellation or termination and notify the 
 23.35  employer of the duty under this chapter to insure the employer's 
 23.36  employees.  
 24.1      (c) In addition to the requirements under paragraphs (a) 
 24.2   and (b), with respect to any trucker employer in classification 
 24.3   7219, 7230, 7231, or 7360 pursuant to the classification plan 
 24.4   required to be filed under section 79.61, if the insurer or its 
 24.5   agent has delivered or mailed a written certificate of insurance 
 24.6   certifying that a policy in the name of a trucker employer under 
 24.7   this paragraph is in force, then the insurer or its agent shall 
 24.8   also deliver or mail written notice of any midterm cancellation 
 24.9   to the trucker employer recipient of the certificate of 
 24.10  insurance at the address listed on the certificate.  ~~If an~~ 
 24.11  ~~insurer or its agent fails to mail or deliver notice of any~~ 
 24.12  ~~midterm cancellation of the trucker employer's policy to the~~ 
 24.13  ~~trucker employer recipient of the certificate of insurance, then~~ 
 24.14  ~~the special compensation fund shall indemnify and hold harmless~~ 
 24.15  ~~the recipient from any award of benefits or other damages under~~ 
 24.16  ~~this chapter resulting from the failure to give notice.~~ 
 24.17     Sec. 25.  Minnesota Statutes 1994, section 176.191, 
 24.18  subdivision 1, is amended to read: 
 24.19     Subdivision 1.  [ORDER; EMPLOYER, INSURER, OR SPECIAL 
 24.20  COMPENSATION FUND PAYMENT.] Where compensation benefits are 
 24.21  payable under this chapter, and a dispute exists between two or 
 24.22  more employers or two or more insurers or the special 
 24.23  compensation fund as to which is liable for payment, the 
 24.24  commissioner, compensation judge, or court of appeals upon 
 24.25  appeal shall direct~~, unless action is taken under subdivision 2,~~ 
 24.26  that one or more of the employers or insurers or the special 
 24.27  compensation fund make payment of the benefits pending a 
 24.28  determination of which has liability.  The special compensation 
 24.29  fund may be ordered to make payment only if it has been made a 
 24.30  party to the claim because the petitioner has alleged that one 
 24.31  or more of the employers is uninsured for workers' compensation 
 24.32  under section 176.183.  A temporary order may be issued under 
 24.33  this subdivision whether or not the employers ~~or~~, insurers, or 
 24.34  special compensation fund agree to pay under the order.  
 24.35     When liability has been determined, the party held liable 
 24.36  for the benefits shall be ordered to reimburse any other party 
 25.1   for payments which the latter has made, including interest at 
 25.2   the rate of 12 percent a year.  The claimant shall also be 
 25.3   awarded a reasonable attorney fee, to be paid by the party held 
 25.4   liable for the benefits. 
 25.5      An order directing payment of benefits pending a 
 25.6   determination of liability may not be used as evidence before a 
 25.7   compensation judge, the workers' compensation court of appeals, 
 25.8   or court in which the dispute is pending. 
 25.9      Sec. 26.  Minnesota Statutes 1994, section 176.215, is 
 25.10  amended by adding a subdivision to read: 
 25.11     Subd. 1a.  [ENFORCEMENT OF ORDER.] If the compensation 
 25.12  judge orders the general contractor, intermediate contractor, or 
 25.13  subcontractor to pay compensation benefits, the award issued 
 25.14  against the general contractor, intermediate contractor, or 
 25.15  subcontractor constitutes a lien for government services under 
 25.16  section 514.67 on all property of the general contractor, 
 25.17  intermediate contractor, or subcontractor and is subject to the 
 25.18  provisions of the revenue recapture act under chapter 270A.  The 
 25.19  special compensation fund may enforce the terms of the award in 
 25.20  the same manner as a district court judgment. 
 25.21     Sec. 27.  Minnesota Statutes 1994, section 176.238, 
 25.22  subdivision 6, is amended to read: 
 25.23     Subd. 6.  [EXPEDITED HEARING BEFORE A COMPENSATION JUDGE.] 
 25.24  A hearing before a compensation judge shall be held within 30 
 25.25  calendar days after the office receives the file from the 
 25.26  commissioner if:  
 25.27     (a) an objection to discontinuance has been filed under 
 25.28  subdivision 4 within 60 calendar days after the notice of 
 25.29  discontinuance was filed and where no administrative conference 
 25.30  has been held; 
 25.31     (b) an objection to discontinuance has been filed under 
 25.32  subdivision 4 within 60 calendar days after the commissioner's 
 25.33  decision under this section has been issued; 
 25.34     (c) a petition to discontinue has been filed by the insurer 
 25.35  in lieu of filing a notice of discontinuance; or 
 25.36     (d) a petition to discontinue has been filed within 60 
 26.1   calendar days after the commissioner's decision under this 
 26.2   section has been issued.  
 26.3      If the petition or objection is filed later than the 
 26.4   deadlines listed above, the expedited procedures in this section 
 26.5   apply only where the employee is unemployed at the time of 
 26.6   filing the objection and shows, to the satisfaction of the chief 
 26.7   administrative judge, by sworn affidavit, that the failure to 
 26.8   file the objection within the deadlines was due to some 
 26.9   infirmity or incapacity of the employee or to circumstances 
 26.10  beyond the employee's control.  The hearing shall be limited to 
 26.11  the issues raised by the notice or petition unless all parties 
 26.12  agree to ~~expanding~~ expand the issues or unless the commissioner 
 26.13  or a compensation judge orders an expansion of the issues.  If 
 26.14  the issues are expanded, the time limits for hearing and 
 26.15  issuance of a decision by the compensation judge under this 
 26.16  subdivision shall not apply.  
 26.17     Once a hearing date has been set, a continuance of the 
 26.18  hearing date will be granted only under the following 
 26.19  circumstances:  
 26.20     (a) the employer has agreed, in writing, to a continuation 
 26.21  of the payment of benefits pending the outcome of the hearing; 
 26.22  or 
 26.23     (b) the employee has agreed, in a document signed by the 
 26.24  employee, that benefits may be discontinued pending the outcome 
 26.25  of the hearing.  
 26.26     Absent a clear showing of surprise at the hearing or the 
 26.27  unexpected unavailability of a crucial witness, all evidence 
 26.28  must be introduced at the hearing.  If it is necessary to accept 
 26.29  additional evidence or testimony after the scheduled hearing 
 26.30  date, it must be submitted no later than 14 days following the 
 26.31  hearing, unless the compensation judge, for good cause, 
 26.32  determines otherwise.  
 26.33     The compensation judge shall issue a decision pursuant to 
 26.34  this subdivision within 30 days following the close of the 
 26.35  hearing record.  
 26.36     Sec. 28.  Minnesota Statutes 1994, section 176.261, is 
 27.1   amended to read: 
 27.2      176.261 [EMPLOYEE OF COMMISSIONER OF THE DEPARTMENT OF 
 27.3   LABOR AND INDUSTRY MAY ACT FOR AND ADVISE A PARTY TO A 
 27.4   PROCEEDING.] 
 27.5      When requested by an employer or an employee or an 
 27.6   employee's dependent, the commissioner of the department of 
 27.7   labor and industry may designate one or more of the division 
 27.8   employees to advise that party of rights under this chapter, and 
 27.9   as far as possible to assist in adjusting differences between 
 27.10  the parties.  The person so designated may appear in person in 
 27.11  any proceedings under this chapter as the representative or 
 27.12  adviser of the party.  In such case, the party need not be 
 27.13  represented by an attorney at law.  
 27.14     Prior to advising an employee or employer to seek 
 27.15  assistance outside of the department, the department ~~must~~ may 
 27.16  refer employers and employees seeking advice or requesting 
 27.17  assistance in resolving a dispute to an attorney 
 27.18  or ~~rehabilitation and medical~~ workers' compensation specialist 
 27.19  employed by the department, whichever is appropriate.  The 
 27.20  department may also refer employers or employees seeking advice 
 27.21  or assistance to other appropriate parties or agencies who can 
 27.22  provide assistance. 
 27.23     The department must make efforts to settle problems of 
 27.24  employees and employers by contacting third parties, including 
 27.25  attorneys, insurers, and health care providers, on behalf of 
 27.26  employers and employees and using the department's persuasion to 
 27.27  settle issues quickly and cooperatively. 
 27.28     Sec. 29.  Minnesota Statutes 1994, section 176.2615, 
 27.29  subdivision 7, is amended to read: 
 27.30     Subd. 7.  [DETERMINATION.] If the parties do not agree to a 
 27.31  settlement, the settlement judge shall summarily hear and 
 27.32  determine the issues and issue an order in accordance with 
 27.33  section 176.305, subdivision 1a~~.~~, except that there is no appeal 
 27.34  or request for a formal de novo hearing from the order.  Any 
 27.35  determination by a settlement judge ~~may not be considered as~~ 
 27.36  ~~evidence in any other proceeding and the issues decided are not~~ 
 28.1   ~~res judicata in any other proceeding~~ shall be res judicata in 
 28.2   subsequent proceeding concerning issues determined under this 
 28.3   section. 
 28.4      Sec. 30.  Minnesota Statutes 1994, section 176.275, 
 28.5   subdivision 1, is amended to read: 
 28.6      Subdivision 1.  [FILING.] If a document is required to be 
 28.7   filed by this chapter or any rules adopted pursuant to authority 
 28.8   granted by this chapter, the filing shall be completed by the 
 28.9   receipt of the document at the division, department, office, or 
 28.10  the court of appeals.  The division, department, office, and the 
 28.11  court of appeals shall accept any document which has been 
 28.12  delivered to it for legal filing immediately upon its receipt, 
 28.13  but may refuse to accept any form or document that lacks the 
 28.14  name of the injured employee, employer, or insurer, the date of 
 28.15  injury, or the injured employee's social security number.  If 
 28.16  the injured employee has fewer than three days of lost time from 
 28.17  work, the party submitting the required document must attach to 
 28.18  it, at the time of filing, a copy of the first report of injury. 
 28.19     A notice or other document required to be served or filed 
 28.20  at either the department, the office, or the court of appeals 
 28.21  which is inadvertently served or filed at the wrong one of these 
 28.22  agencies shall be deemed to have been served or filed with the 
 28.23  proper agency.  The receiving agency shall note the date of 
 28.24  receipt of a document and shall forward the documents to the 
 28.25  proper agency no later than two working days following receipt.  
 28.26     Sec. 31.  Minnesota Statutes 1994, section 176.281, is 
 28.27  amended to read: 
 28.28     176.281 [ORDERS, DECISIONS, AND AWARDS; FILING; SERVICE.] 
 28.29     When the commissioner or compensation judge or office of 
 28.30  administrative hearings or the workers' compensation court of 
 28.31  appeals has rendered a final order, decision, or award, or 
 28.32  amendment to an order, decision, or award, it shall be filed 
 28.33  immediately with the commissioner.  If the commissioner, 
 28.34  compensation judge, office of administrative hearings, or 
 28.35  workers' compensation court of appeals has rendered a final 
 28.36  order, decision, or award, or amendment thereto, the 
 29.1   commissioner or the office of administrative hearings or the 
 29.2   workers' compensation court of appeals shall immediately serve a 
 29.3   copy upon every party in interest, together with a notification 
 29.4   of the date the order was filed. 
 29.5      On all orders, decisions, awards, and other documents, the 
 29.6   commissioner or compensation judge or office of administrative 
 29.7   hearings or the workers' compensation court of appeals may 
 29.8   digitize the signatures of all officials, including judges, for 
 29.9   the use of electronic data interchange and clerical automation.  
 29.10  These signatures shall have the same legal authority of an 
 29.11  original signature, provided that proper security is used to 
 29.12  safeguard the use of the digitized signatures and each digitized 
 29.13  signature has been certified by the division, department, 
 29.14  office, or court of appeals before its use, in accordance with 
 29.15  rules adopted by that agency or court.  
 29.16     Sec. 32.  Minnesota Statutes 1994, section 176.285, is 
 29.17  amended to read: 
 29.18     176.285 [SERVICE OF PAPERS AND NOTICES.] 
 29.19     Service of papers and notices shall be by mail or otherwise 
 29.20  as the commissioner or the chief administrative law judge may by 
 29.21  rule direct.  Where service is by mail, service is effected at 
 29.22  the time mailed if properly addressed and stamped.  If it is so 
 29.23  mailed, it is presumed the paper or notice reached the party to 
 29.24  be served.  However, a party may show by competent evidence that 
 29.25  that party did not receive it or that it had been delayed in 
 29.26  transit for an unusual or unreasonable period of time.  In case 
 29.27  of nonreceipt or delay, an allowance shall be made for the 
 29.28  party's failure to assert a right within the prescribed time.  
 29.29     Where service to the division, department, office, or court 
 29.30  of appeals is by electronic filing, digitized signatures may be 
 29.31  used provided that the signature has been certified by the 
 29.32  department no later than five business days after filing.  The 
 29.33  department or court may adopt rules for the certification of 
 29.34  signatures. 
 29.35     When the electronic filing of a legal document with the 
 29.36  department marks the beginning of a prescribed time for another 
 30.1   party to assert a right, the prescribed time for another party 
 30.2   to assert a right shall be lengthened by two calendar days when 
 30.3   it can be shown that service to the other party was by mail.  
 30.4      The commissioner and the chief administrative law judge 
 30.5   shall ensure that proof of service of all papers and notices 
 30.6   served by their respective agencies is placed in the official 
 30.7   file of the case.  
 30.8      Sec. 33.  Minnesota Statutes 1994, section 176.291, is 
 30.9   amended to read: 
 30.10     176.291 [DISPUTES; PETITIONS; PROCEDURE.] 
 30.11     Where there is a dispute as to a question of law or fact in 
 30.12  connection with a claim for compensation, a party may serve on 
 30.13  all other parties and file a ~~notarized~~ petition with the 
 30.14  commissioner stating the matter in dispute.  The petition shall 
 30.15  be on a form prescribed by the commissioner and shall be signed 
 30.16  by the petitioner. 
 30.17     The petition shall also state and include, where applicable:
 30.18     (1) names and residence or business address of parties; 
 30.19     (2) facts relating to the employment at the time of injury, 
 30.20  including amount of wages received; 
 30.21     (3) extent and character of injury; 
 30.22     (4) notice to or knowledge by employer of injury; 
 30.23     (5) copies of written medical reports or other information 
 30.24  in support of the claim; 
 30.25     (6) names and addresses of all known witnesses intended to 
 30.26  be called in support of the claim; 
 30.27     (7) the desired location of any hearing and estimated time 
 30.28  needed to present evidence at the hearing; 
 30.29     (8) any requests for a prehearing or settlement conference; 
 30.30     (9) a list of all known third parties, including the 
 30.31  departments of human services and economic security, who may 
 30.32  have paid any medical bills or other benefits to the employee 
 30.33  for the injuries or disease alleged in the petition or for the 
 30.34  time the employee was unable to work due to the injuries or 
 30.35  disease, together with a listing of the amounts paid by each; 
 30.36     (10) the nature and extent of the claim; and 
 31.1      (11) a request for an expedited hearing which must include 
 31.2   an attached affidavit of significant financial hardship which 
 31.3   complies with the requirements of section 176.341, subdivision 6.
 31.4      Incomplete petitions may be stricken from the calendar as 
 31.5   provided by section 176.305, subdivision 4.  Within 30 days of a 
 31.6   request by a party, an employee who has filed a claim petition 
 31.7   pursuant to section 176.271 or this section shall furnish a list 
 31.8   of physicians and health care providers from whom the employee 
 31.9   has received treatment for the same or a similar condition as 
 31.10  well as authorizations to release relevant information, data, 
 31.11  and records to the requester.  The petition may be stricken from 
 31.12  the calendar upon motion of a party for failure to timely 
 31.13  provide the required list of health care providers or 
 31.14  authorizations.  
 31.15     Sec. 34.  Minnesota Statutes 1994, section 176.305, 
 31.16  subdivision 1a, is amended to read: 
 31.17     Subd. 1a.  [SETTLEMENT AND PRETRIAL CONFERENCES; SUMMARY 
 31.18  DECISION.] The commissioner shall schedule a settlement 
 31.19  conference, if appropriate, within 60 days after receiving the 
 31.20  petition.  All parties must appear at the conference, either 
 31.21  personally or by representative, must be prepared to discuss 
 31.22  settlement of all issues, and must be prepared to discuss or 
 31.23  present the information required by the joint rules of the 
 31.24  division and the office.  If a representative appears on behalf 
 31.25  of a party, the representative must have authority to fully 
 31.26  settle the matter.  
 31.27     If settlement is not reached, the presiding officer may 
 31.28  require the parties to present copies of all documentary 
 31.29  evidence not previously filed and a summary of the evidence they 
 31.30  will present at a formal hearing.  If appropriate, a written 
 31.31  summary decision shall be issued within ten days after the 
 31.32  conference stating the issues and a determination of each 
 31.33  issue.  If a party fails to appear at the conference, all issues 
 31.34  may be determined contrary to the absent party's interest, 
 31.35  provided the party in attendance presents a prima facie case.  
 31.36     The summary decision is final unless a written request for 
 32.1   a formal hearing is served on all parties and filed with the 
 32.2   commissioner within 30 days after the date of service and filing 
 32.3   of the summary decision.  Within ten days after receipt of the 
 32.4   request, the commissioner shall certify the matter to the office 
 32.5   for a de novo hearing.  In proceedings under section 176.2615, 
 32.6   the summary decision is final and not subject to appeal or de 
 32.7   novo proceedings. 
 32.8      Sec. 35.  Minnesota Statutes 1994, section 176.645, is 
 32.9   amended to read: 
 32.10     176.645 [ADJUSTMENT OF BENEFITS.] 
 32.11     Subdivision 1.  [AMOUNT.] For injuries occurring after 
 32.12  October 1, 1975 for which benefits are payable under section 
 32.13  176.101, subdivisions 1, 2 and 4, and section 176.111, 
 32.14  subdivision 5, the total benefits due the employee or any 
 32.15  dependents shall be adjusted in accordance with this section.  
 32.16  On October 1, 1981, and thereafter on the anniversary of the 
 32.17  date of the employee's injury the total benefits due shall be 
 32.18  adjusted by multiplying the total benefits due prior to each 
 32.19  adjustment by a fraction, the denominator of which is the 
 32.20  statewide average weekly wage for December 31, of the year two 
 32.21  years previous to the adjustment and the numerator of which is 
 32.22  the statewide average weekly wage for December 31, of the year 
 32.23  previous to the adjustment.  For injuries occurring after 
 32.24  October 1, 1975, all adjustments provided for in this section 
 32.25  shall be included in computing any benefit due under this 
 32.26  section.  Any limitations of amounts due for daily or weekly 
 32.27  compensation under this chapter shall not apply to adjustments 
 32.28  made under this section.  No adjustment increase made on or 
 32.29  after October 1, 1977, but prior to October 1, 1992, under this 
 32.30  section shall exceed six percent a year; in those instances 
 32.31  where the adjustment under the formula of this section would 
 32.32  exceed this maximum, the increase shall be deemed to be six 
 32.33  percent.  No adjustment increase made on or after October 1, 
 32.34  1992, under this section shall exceed four percent a 
 32.35  year regardless of the date of injury; in those instances where 
 32.36  the adjustment under the formula of this section would exceed 
 33.1   this maximum, the increase shall be deemed to be four 
 33.2   percent without regard to the date of injury. 
 33.3      Subd. 2.  [TIME OF FIRST ADJUSTMENT.] For injuries 
 33.4   occurring on or after October 1, 1981, the initial adjustment 
 33.5   made pursuant to subdivision 1 is deferred until the first 
 33.6   anniversary of the date of the injury.  For injuries occurring 
 33.7   on or after October 1, 1992, the initial adjustment under 
 33.8   subdivision 1 is deferred until the second anniversary of the 
 33.9   date of the injury.  The adjustment made at that time shall be 
 33.10  that of the last year only. 
 33.11     Sec. 36.  Minnesota Statutes 1994, section 176.83, 
 33.12  subdivision 5, is amended to read: 
 33.13     Subd. 5.  [TREATMENT STANDARDS FOR MEDICAL SERVICES.] In 
 33.14  consultation with the medical services review board or the 
 33.15  rehabilitation review panel, the commissioner shall adopt 
 33.16  emergency and permanent rules establishing standards and 
 33.17  procedures for health care provider treatment.  The rules shall 
 33.18  apply uniformly to all providers including those providing 
 33.19  managed care under section 176.1351.  The rules shall be used to 
 33.20  determine whether a provider of health care services and 
 33.21  rehabilitation services, including a provider of medical, 
 33.22  chiropractic, podiatric, surgical, hospital, or other services, 
 33.23  is performing procedures or providing services at a level or 
 33.24  with a frequency that is excessive, unnecessary, or 
 33.25  inappropriate under section 176.135, subdivision 1, based upon 
 33.26  accepted medical standards for quality health care and accepted 
 33.27  rehabilitation standards.  
 33.28     The rules shall include, but are not limited to, the 
 33.29  following: 
 33.30     (1) criteria for diagnosis and treatment of the most common 
 33.31  work-related injuries including, but not limited to, low back 
 33.32  injuries and upper extremity repetitive trauma injuries; 
 33.33     (2) criteria for surgical procedures including, but not 
 33.34  limited to, diagnosis, prior conservative treatment, supporting 
 33.35  diagnostic imaging and testing, and anticipated outcome 
 33.36  criteria; 
 34.1      (3) criteria for use of appliances, ~~adoptive~~ adaptive 
 34.2   equipment, and use of health clubs or other exercise facilities; 
 34.3      (4) criteria for diagnostic imaging procedures; 
 34.4      (5) criteria for inpatient hospitalization; and 
 34.5      (6) criteria for treatment of chronic pain. 
 34.6      If it is determined by the payer that the level, frequency 
 34.7   or cost of a procedure or service of a provider is excessive, 
 34.8   unnecessary, or inappropriate according to the standards 
 34.9   established by the rules, the provider shall not be paid for the 
 34.10  procedure, service, or cost by an insurer, self-insurer, or 
 34.11  group self-insurer, and the provider shall not be reimbursed or 
 34.12  attempt to collect reimbursement for the procedure, service, or 
 34.13  cost from any other source, including the employee, another 
 34.14  insurer, the special compensation fund, or any government 
 34.15  program unless the commissioner or compensation judge determines 
 34.16  at a hearing or administrative conference that the level, 
 34.17  frequency, or cost was not excessive under the rules in which 
 34.18  case the insurer, self-insurer, or group self-insurer shall make 
 34.19  the payment deemed reasonable.  
 34.20     A rehabilitation provider who is determined by the 
 34.21  rehabilitation review panel board, after hearing, to be 
 34.22  consistently performing procedures or providing services at an 
 34.23  excessive level or cost may be prohibited from receiving any 
 34.24  further reimbursement for procedures or services provided under 
 34.25  this chapter.  A prohibition imposed on a provider under this 
 34.26  subdivision may be grounds for revocation or suspension of the 
 34.27  provider's license or certificate of registration to provide 
 34.28  health care or rehabilitation service in Minnesota by the 
 34.29  appropriate licensing or certifying body.  The commissioner and 
 34.30  medical services review board shall review excessive, 
 34.31  inappropriate, or unnecessary health care provider treatment 
 34.32  under section 176.103~~, subdivision 2~~. 
 34.33     Sec. 37.  [REPEALER.] 
 34.34     Minnesota Statutes 1994, sections 176.103, subdivision 2a; 
 34.35  and 176.191, subdivision 2, are repealed.