GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1993

S	1 

SENATE BILL 540

Short Title:  Workers' Comp. Changes.	(Public)
─────────────────────────────────────── 
Sponsors: Senator Smith.
─────────────────────────────────────── 
Referred to:  Manufacturing and Labor.
─────────────────────────────────────── 

March 24, 1993

A BILL TO BE ENTITLED
AN ACT TO MAKE TECHNICAL AND OTHER CHANGES TO THE WORKERS' COMPENSATION ACT, AND TO CREATE THE SPECIAL INDUSTRIAL COMMISSION FUND FOR THE OPERATION OF THE INDUSTRIAL COMMISSION AND DIRECT THAT A PORTION OF THE TAX PAID ON WORKERS' COMPENSATION PREMIUMS BE PAID TO THIS FUND.
The General Assembly of North Carolina enacts:
Section 1. G. S. 97.2(19) reads as rewritten:
"(19)	Medical Compensation. – The term 'medical compensation' means medical, surgical, hospital, nursing, and rehabilitative services including travel expenses for required job searches, and medicines, sick travel, and other treatment, including medical and surgical supplies, as may reasonably be required to effect a cure or give relief and for such additional time as, in the judgment of the Commission, will tend to lessen the period of disability; and any original artificial members as may reasonably be necessary at the end of the healing period."
Sec. 2. G.S. 97-18(e) reads as rewritten:
"(e)	If any installment of compensation payable in accordance with the terms of an agreement approved by the Commission is not paid within 14 days after it becomes due, as provided in subsection (b) of  this section, or if any installment of compensation payable in accordance with the terms of an award by the Commission is not paid within 14 days after it becomes due, as provided in subsection (c) of this section, there shall be added to such unpaid installment an additional amount equal to the amount of such installment, which shall be paid at the same time as, but in addition to, such installment, unless such nonpayment is excused by the Commission after a showing by the employer that owing to conditions over which he had no control such installment could not be paid within the period prescribed for the payment."
Sec. 3. G.S. 97-18(g) reads as rewritten:
"(g)	If any bill for services rendered under G.S. 97-25 by any provider of health care is not paid within 60 days after it has been approved by the Commission and returned to the responsible party, there shall be added to such unpaid bill an additional amount equal to the amount of such unpaid bill which shall be paid at the same time as, but in addition to, such medical bill, unless such late payment is excused by the Commission."
Sec. 4. G.S. 97-40.1(a) reads as rewritten:
"(a)	There is hereby created a fund to be known as the 'Second Injury Fund,' to be held and disbursed by the Industrial Commission as hereinafter provided.
For the purpose of providing money for said fund the Industrial Commission may assess against the employer or its insurance carrier the payment of not to exceed two hundred fifty dollars ($250.00) for the loss, or loss of use, of each minor member in every case of a permanent partial disability where there is such loss, and shall assess not to exceed seven hundred fifty dollars ($750.00) for fifty percent (50%) or more loss or loss of use of each major member, defined as back, foot, leg, hand, arm, eye, or hearing.
In addition to the assessments hereinabove provided for, the Commission shall also deposit in said fund all moneys received by it for the Second Injury Fund under the provisions of G.S. 97-40."
Sec. 5. G.S. 97-77 reads as rewritten:
"§ 97-77.  North Carolina Workers' Compensation Commission created; members appointed by Governor; terms of office; chairman.
(a)	There is hereby created a commission to be known as the North Carolina Workers' Compensation Commission, consisting of three commissioners who shall devote their entire time to the duties of the Commission.  The Governor shall appoint each member for a term of six years.  Each member shall be a member in good standing of the North Carolina State Bar. 
(b)	One member, to be designated by the Governor, shall act as chairman.  The chairman shall be the chief judicial officer and the chief executive officer of the Workers' Compensation Commission; such authority shall be exercised pursuant to the provisions of Chapter 126 of the General Statutes and the rules and policies of the State Personnel Commission.  Notwithstanding the provisions of this Chapter, the chairman shall have such authority as is necessary to direct and oversee the Commission.  The chairman may delegate any duties and responsibilities as may be necessary to ensure the proper management of the Workers' Compensation Commission.  Notwithstanding the provisions of this Chapter, Chapter 143A, and Chapter 143B of the General Statutes, the chairman, with the approval of at least one of the other commissioners, shall have the authority to hire or fire personnel and to transfer personnel within the Workers' Compensation Commission.
The Governor may designate one vice-chairman from the remaining two commissioners.  The vice-chairman shall assume the powers of the chairman upon request of the chairman or when the chairman is absent for 24 hours or more.  The authority delegated to the vice-chairman shall be relinquished immediately upon the return of the chairman or at the request of the chairman.
A commissioner in office shall continue to serve until the commissioner's successor is duly confirmed and qualified but such holdover shall not affect the expiration date of such succeeding term.
The salary of each commissioner shall be same as that fixed from time to time for judges of the superior court except that the commissioner designated as chairman shall receive one thousand dollars ($1,000) additional per annum.  In lieu of merit and other increment raises paid to regular State employees, each commissioner, including the commissioner designated as chairman, shall receive as longevity pay an amount equal to four and eight-tenths percent (4.8%) of the annual salary set forth in the Current Operations Appropriations Act payable monthly after five years of service, and nine and six-tenths percent (9.6%) after 10 years of service. The term 'service' means service as a member of the Workers' Compensation Commission.
Members of the Commission shall be reimbursed for travel and subsistence expenses at the rates allowed to State officers and employees by G.S. 138-6(a)."
Sec. 6. G.S. 97-85 reads as rewritten:
"§ 97-85. Review of award.
If application is made to the Commission within 15 days from the date when notice of the award shall have been given, the full Commission shall review the award. It shall be within the sound discretion of the full Commission, upon review of an award and if good ground be shown, to decide whether to reconsider the evidence, receive further evidence, rehear the parties or their representatives, and, if proper, amend the award. It shall further be within the sound discretion of the full Commission to remand a case, if deemed necessary, back to a Deputy Commissioner for reconsideration of evidence presented, receipt of further evidence, rehearing of parties or their representatives, and, if proper, amendment of the original award. When application is made for review of an award, and such an award has been heard and determined by a commissioner of the North Carolina Industrial Commission, the commissioner who heard and determined the dispute in the first instance, as specified by G.S. 97-84, shall be disqualified from sitting with the full Commission on the review of such award, and the chairman of the Industrial Commission shall designate a deputy commissioner to take such commissioner's place in the review of the particular award. The deputy commissioner so designated, along with the two other commissioners, shall compose the full Commission upon review. Provided further, the chairman of the Commission shall have the authority to designate a deputy commissioner to take the place of a commissioner on the review of any case, in which event the deputy commissioner so designated shall have the same authority and duty as does the commissioner whose place he occupies on such review."
Sec. 7. G.S. 97-86.1(a) reads as rewritten:
"(a)	When any appeal to the full Commission or appeal or certification to the Court of Appeals is pending, and it appears to the Commission that any part of the award appealed from is not appealed by the issues raised by such appeal, the Commission may, on action or of its own motion, render a judgment directing compliance with any portion of such award not affected by such appeal; or, if the only issue raised by such appeal is the amount of the average weekly wage, the Commission shall, on motion of the claimant, direct the payment of such portion of the compensation payable under its award as is not in dispute, if any, pending final adjudication of the undisputed portion thereof."
Sec. 8. G.S. 97-87 reads as rewritten:
"§ 97-87. Filing agreements approved by Commission or awards; judgment in accordance therewith; discharge or restoration of lien.
Any party in interest may file in the superior court of the county in which the injury occurred a certified copy of a memorandum of agreement approved by the Commission, or of an order or decision of the Commission, or of an award of the Commission unappealed from or of an award of the Commission affirmed upon appeal, whereupon said court shall render judgment in accordance therewith, and notify the parties. Such judgment shall have the same effect, and all proceedings in relation thereto shall thereafter be the same, as though said judgment had been rendered in a suit duly heard and determined by said court: Provided, if the judgment debtor shall file a certificate duly issued by the Commission showing compliance with G.S. 97-83 with the clerk of the superior court in the county or counties where such judgment is docketed, then such clerk shall make upon the judgment roll an entry showing the filing of such certificate which shall operate as a discharge of the lien of the said judgment, and no execution shall be issued thereon; provided, further, that if at any time there is default in the payment of any installment due under the award set forth in said judgment the court may, upon application for cause and after 10 days' notice to judgment debtor, order the lien of such judgment restored, and execution may be immediately issued thereon for past due installments and for future installments as they may become due."
Sec. 9. G.S. 97-88 reads as rewritten:
"§ 97-88. Expenses of appeals brought by insurers.
If the Commission at a hearing on review or any court before which any proceedings are brought on appeal under this Article, shall find that such hearing or proceedings were brought by the defendant and the Commission or court by its decision orders the defendant to make, or to continue payments of benefits, including compensation for medical expenses, to the injured employee, the Commission or court may further order that the cost to the injured employee of such hearing or proceedings including therein reasonable attorney's fee to be determined by the Commission shall be paid by the defendant as a part of the bill of costs."
Sec. 10. G.S. 97-90(a) reads as rewritten:
"(a)	Fees for attorneys and physicians and charges of hospitals for medical compensation under this Article shall be subject to the approval of the Commission; but no physician or hospital or other medical facility shall be entitled to collect fees from an employer or insurance carrier until he has made the reports required by the Industrial Commission in connection with the case.  Unless otherwise provided by the rules, schedules, or orders of the Commission, a request for a specific prior approval to charge shall be submitted to the Commission for each such fee or charge."
Sec. 11. G.S. 97-92(e) reads as rewritten:
"(e)	Any employer who refuses or neglects to make the report required by this section shall be liable for a penalty of one hundred dollars ($100.00) plus fifty dollars ($50.00) for each additional day that the employer refuses or neglects to make the required report. The fine herein provided may be assessed by the Commission in an open hearing, with the right of review and appeal as in other cases. In the event the employer has transmitted the report to the insurance carrier for transmission by such insurance carrier to the Industrial Commission, the insurance carrier willfully neglecting or failing to transmit the report shall be liable for the said penalty."
Sec. 12. G.S. 97-100 reads as rewritten:
"§ 97-100. Rates for insurance; carrier to make reports for determination of solvency; tax upon premium; returned or canceled premiums; reports of premiums collected; wrongful or fraudulent representation of carrier punishable as misdemeanor; notices to carrier; employer who carries own risk shall make report on payroll.
(a)	The rates charged by all carriers of insurance, including the parties to any mutual insurance association writing insurance against the liability for compensation under this Article, shall be fair, reasonable, and adequate.
(b)	Each such insurance carrier shall report to the Commissioner of Insurance, in accordance with such reasonable rules as the Commissioner of Insurance may at any time prescribe, for the purpose of determining the solvency of the carrier and the adequacy of its rates; for such purpose the Commissioner of Insurance may inspect the books and records of such insurance carrier, and examine its agents, officers, and directors under oath.
(c)	Every person, partnership, association, corporation, whether organized under the laws of this or any other state or country, every mutual company or association and every other insurance carrier insuring employers in this State against liability for personal injuries to their employees, or death caused thereby, under the provisions of this Article, shall, as hereinafter provided, pay a tax upon the premium received, whether in cash or notes, in this State, or on account of business done in this State, for such insurance in this State, at the rate provided in the Revenue Act then in force, which tax shall be in lieu of all other taxes on such premiums, which tax shall be assessed and collected as hereinafter provided; provided, however, that such insurance carriers shall be credited with all canceled or returned premiums actually refunded during the year on such insurance.
(d)	Every such insurance carrier shall, for the six months ending December 31, 1929, and annually thereafter, make a return, verified by the affidavit of its president and secretary, or other chief officers or agents, to the Commissioner of Insurance, stating the amount of all such premiums and credits during the period covered by such return. Every insurance carrier required to make such return shall file the same with the Commissioner of Insurance on or before the first day of April after the close of the period covered thereby, and shall at the same time pay to the State Insurance Commissioner the tax provided in the Revenue Act then in force on such premium ascertained, as provided in subsection (c) hereof, less returned premium on canceled policies.
(e)	If any such insurance carrier shall fail or refuse to make the return required by this Article, the said Commissioner of Insurance shall assess the tax against such insurance carrier at the rate herein provided for, on such amount of premium as he may deem just, and the proceedings thereon shall be the same as if the return had been made.
(f)	If any such insurance carrier shall withdraw from business in this State before the tax shall fall due, as herein provided, or shall fail or neglect to pay such tax, the Commissioner of Insurance shall at once proceed to collect the same; and he is hereby empowered and authorized to employ such legal process as may be necessary for that purpose, and when so collected he shall pay the same into the State treasury. The suit may be brought by the Commissioner of Insurance, in his official capacity, in any court of this State having jurisdiction. Reasonable attorney's fees may be taxed as costs therein, and process may issue to any county of the State, and may be served as in civil actions, or in case of unincorporated associations, partnerships, interindemnity contracts, upon any agent of the parties thereto upon whom process may be served under the laws of this State.
(g)	Any person or persons who shall in this State act or assume to act as agent for any such insurance carrier whose authority to do business in this State has been suspended, while such suspension remains in force, or shall neglect or refuse to comply with any of the provisions of this section obligatory upon such person or party or who shall willfully make a false or fraudulent statement of the business or condition of any such insurance carrier, or false or fraudulent return as herein provided, shall be deemed guilty of a misdemeanor, and upon conviction shall be punished by a fine of not less than one hundred dollars ($100.00) nor more than one thousand dollars ($1,000), or by imprisonment for not less than 10 nor more than 90 days, or both such fine and imprisonment in the discretion of the court.
(h)	Whenever by this Article, or the terms of any policy contract, any officer is required to give any notice to an insurance carrier, the same may be given by delivery, or by mailing by registered letter properly addressed and stamped, to the principal office or general agent of such insurance carrier within this State, or to its home office, or to the secretary, general agent, or chief officer thereof in the United States, or the State Insurance Commissioner.
(i)	Any insurance carrier liable to pay a tax upon premiums under this Article shall not be liable to pay any other or further tax upon such premiums, under any other law of this State.
(j)	Every employer carrying his own risk under the provisions of G.S. 97-93 shall, under oath, report to the Commissioner of Insurance his payroll, subject to the provisions of this Article. Such report shall be made in form prescribed by the Commissioner of Insurance, and at the times herein provided for premium reports by insurer. The Commissioner of Insurance shall assess against such payroll a maintenance fund tax computed by taking such percent of the basic premiums charged against the same or most similar industry or business taken from the manual insurance rate then in force in this State as is assessed in the Revenue Act against the insurance carriers for premiums collected on compensation insurance policies.  The Commissioner shall use the approved experience modifier of an employer in calculating the employer's maintenance fund tax liability under this subsection.  
(k)	Every group of two or more employers who have pooled their liabilities pursuant to G.S. 97-93 shall pay a tax upon premiums received in this State in the same manner as the tax is calculated and paid by insurance carriers insuring employers in this State and set forth in subsections (c), (d), (e), and (f) above.
(l)	A special fund in the Office of the State Treasurer, the Special Industrial Commission Fund, is created.  One percent (1%) of the tax on premiums collected by the Commissioner of Insurance pursuant to subsections (d) and (j) of this section shall be deposited in the Special Industrial Commission Fund.  Interest derived from the Fund shall be credited to the Fund.
The Special Industrial Commission Fund shall be subject to the provisions of the Executive Budget Act except that no unexpended surplus of the Fund shall revert to the General Fund.  All funds credited to the Fund shall be used for the operation of the North Carolina Industrial Commission.
The remaining ninety-nine percent (99%) of the tax on premiums collected by the Commissioner of Insurance pursuant to subsections (d) and (j) of this section shall be deposited in the General Fund."
Sec. 13. If Section 5 of this act is ratified, the phrase 'Industrial Commission' is deleted and replaced by the phrase 'Workers' Compensation Commission wherever it occurs in the General Statutes.
Sec. 14. Section 12 of this act becomes effective July 1, 1993, and applies to all taxes imposed on workers' compensation premiums collected on or after that date.  The remainder of this act is effective upon ratification.