A BILL TO BE ENTITLED
AN ACT clarifying the authority and duties of industrial commission fraud investigators and making technical, conforming, and other changes to the workers' compensation laws of north carolina.
The General Assembly of North Carolina enacts:
SECTION 1.(a)  Article 1 of Chapter 97 of the General Statutes is amended by adding a new section to read:
"§ 97‑79.1.  Authority of Industrial Commission fraud investigators; inspection of records.
(a)	The Commission shall establish a Criminal Investigation Unit to operate as a law enforcement agency for the enforcement of this Chapter. Members of the unit shall serve as fraud investigators and must be sworn law enforcement officers duly appointed and certified by the North Carolina Criminal Justice Education and Training Standards Commission.
(b)	A fraud investigator employed by the Commission, who has sworn the oath prescribed for a law enforcement officer, shall have the following authority:
(1)	To make arrests and take other investigatory and enforcement actions for both felonies and misdemeanors and to charge for infractions for violations of the laws of the State, with the primary responsibility of enforcing the Workers' Compensation Act.
(2)	To act as a State law enforcement officer with jurisdiction throughout the State.
(3)	To serve and execute orders issued by the Commission in connection with contempt proceedings. While serving and executing such an order, a fraud investigator has the same authority and power possessed by a local law officer or sheriff's deputy when executing an arrest warrant.
(4)	To inspect records of business kept under G.S. 58‑2‑185 by insurance companies, agents, or brokers doing any kind of business in this State involving workers' compensation.
(c)	Each insurance company, agent, or broker keeping records under G.S. 58‑2‑185 shall furnish copies of these records to the Commission's fraud investigators on demand, and the original books of records shall be open to the inspection of the Commissioner when demanded. Any person who refuses, on demand, to exhibit the records of business as provided by this subsection or who knowingly makes a false statement in regard to the records when demanded is guilty of a Class 1 misdemeanor."
SECTION 1.(b)  G.S. 143‑166.13 is amended by adding a new subdivision to read:
"(20)	Sworn State Law‑Enforcement Officers with the power of arrest, Industrial Commission Fraud Investigators, Department of Commerce."
SECTION 2.  G.S. 97‑88.2(b) reads as rewritten:
"(b)	The Commission shall:
(1)	Perform investigations regarding all cases of suspected fraud and all violations related to workers' compensation claims, by or against insurers or self‑funded employers, and refer possible criminal violations to the Criminal Investigation Unit.
(2)	Conduct administrative violation proceedings; and
(3)	Assess and collect civil penalties and restitution.
The Commission may employ sworn law enforcement officers pursuant to G.S. 97‑79.1 to enforce the laws and conduct the investigations mandated by this section."
SECTION 3.  G.S. 97‑73(d) reads as rewritten:
"(d)	Safety. – A fee in the amount set by the Industrial Commission is imposed on an employer for whom the Industrial Commission provides an educational training program on how to prevent or reduce accidents or injuries that result in workers' compensation claims or a person for whom the Industrial Commission provides other educational services. The Commission may set a reasonable fee imposed for a review of the safety rules. The fees are departmental receipts."
SECTION 4.  G.S. 97‑87(c)(5) reads as rewritten
"(5)	If any party disputes the decision of the Commission entered under subdivision (c)(4) of this section, the party may appeal to the full Commission within 10 days of the entry of the decision of the Commission. The nonappealing party may file a response within 10 days of receiving notice of appeal. The notice of appeal shall request one of the following:
a.	The Commission reconsider the decision entered based on the record and any additional evidence that parties submit with the notice and response.
b.	A de novo evidentiary hearing before the Commission."
SECTION 5.  G.S. 97‑87(c)(7) reads as rewritten:
"(c)	When an award or portion of an award provides for periodic payments to be made on or after the date of the award, a judgment may be docketed as provided in subsection (d) of this section, in an amount equal to the sum stated in any Certificate of Accrued Arrearages that is issued by the Commission under this subsection. If any payment that has accrued after the date of the award, or after the date specified in the most recent Certificate of Accrued Arrearages issued under this subsection, is not received by the claimant when due, the following procedure is available for obtaining a Certificate of Accrued Arrearages:
…
(7)	If a notice of appeal is given under sub‑subdivision (c)(5)a. of this section, the Commission shall issue its decision within 10 days of the filing of the response under subdivision (c)(5)b. of this section. If a notice of appeal is given under sub‑subdivision (c)(5) of this section, the Commission shall either (i) conduct an evidentiary hearing and issue its decision on the appeal within 90 days of the filing of the response, or when a response is due if no response is filed, under subdivision (c)(5) of this section or (ii) deny the request for the evidentiary hearing and issue its decision within 10 days of the filing of the response under subdivision (c)(5) of this section. Further appeals are governed by G.S. 97‑86."
SECTION 6.  G.S. 97‑92(d) reads as rewritten:
"(d)	The said report shall contain the name, nature, and location of the business of the employer and name, age, sex, wages, if available, and occupation of the injured employee, and shall state the date and hour of the accident causing injury, the nature and cause of the injury, and such other information as may be required by the Commission."
SECTION 7.  G.S. 97‑101 reads as rewritten:
"§ 97‑101.  Collection of fines and penalties.
The Industrial Commission shall have the power by civil action brought in its own name to enforce the collection of any fines or penalties provided by this Article."
SECTION 8.  G.S. 97‑26.2 reads as rewritten:
"§ 97‑26.2.  Reimbursement for prescription drugs, prescribed over‑the‑counter drugs, and professional pharmaceutical services.
(a)	The reimbursement for prescription drugs, prescribed over‑the‑counter drugs, and professional pharmaceutical services shall be limited to no greater than ninety‑five percent (95%) of the average wholesale price (AWP) of the product, calculated on a per unit basis, as of the date of dispensing.
(b)	All of the following shall apply to the reimbursement for prescription drugs and professional pharmaceutical services:
(1)	A health care provider seeking reimbursement for health care provider dispensed prescription drugs, prescribed over‑the‑counter drugs, and pharmaceutical services shall include the original manufacturer's National Drug Code (NDC) number, as assigned by the United States Food and Drug Administration, on any billing documents or invoices issued.
(2)	In no event may a health care provider receive reimbursement in excess of ninety‑five percent (95%) of the AWP of the drugs dispensed by a health care provider, as determined by reference to the original manufacturer's NDC number.
(3)	A repackaged NDC number may not be individually used on any billing documents or invoices issued and will not be considered the original manufacturer's NDC number. A repackaged NDC number may only appear in conjunction with the manufacturer's NDC number. If a health care provider seeking reimbursement for drugs dispensed by a health care provider does not include the original manufacturer's NDC number on any billing documents or invoices issued, reimbursement shall be limited to one hundred percent (100%) of the AWP of the least expensive clinically equivalent drug, calculated on a per unit basis.
(4)	No outpatient provider, other than a licensed pharmacy, may receive reimbursement for a Schedule II controlled substance, as defined in G.S. 90‑90, or a Schedule III controlled substance, as defined in G.S. 90‑91, or a Schedule IV controlled substance, as defined by G.S. 90‑92, dispensed in excess of an initial five‑day supply, commencing upon the employee's initial treatment following injury. Only the initial health care provider providing the employee's initial treatment following injury may seek reimbursement for dispensing controlled substances as described in this section, and any subsequent dispensing of controlled substances by another health care provider will be ineligible for reimbursement. Reimbursement under this subdivision shall be made for the five‑day supply at the rates provided in this section.
(5)	For purposes of this section, the term "clinically equivalent" means a drug has chemical equivalents which, when administered in the same amounts, will provide essentially the same therapeutic effect as measured by the control of a symptom or disease."
SECTION 9.  G.S. 97‑200(a) reads as rewritten:
"(a)	A self‑insurer shall not utilize any claims adjuster unless the adjuster is licensed under G.S. 58‑33‑26."
SECTION 10.  This act is effective when it becomes law.