Establishes loss of workers' compensation benefits for substantial noncompliance with recommended treatment plan. Exempts noncompliance with treatment plan for good cause from loss of benefits penalty. Establishes a limit of 24 visits per year to chiropractor or massage therapy for a work-related injury. Provides process to streamline medical information release as it relates to work-related injuries.

A BILL FOR AN ACT

SECTION 1. The legislature finds that in 2001, 2002, and 2003, Hawaii's workers' compensation rates--driven by rising medical costs--have gone up an average of 3.5 per cent in 2001, 4.6 per cent in 2002, and eight per cent last year. In August 2004, a study by the private Work Loss Data Institute gave Hawaii a failing grade for its workers' compensation system in 2002, primarily because injured workers stayed out much longer than in other states. The legislature also finds that in Hawaii, 22.6 per cent of injured workers stayed off the job for more than thirty days.

The legislature further finds that, during the 1995 and 1996 regular legislative sessions, the legislature enacted major sweeping workers' compensation reforms that resulted in workers' compensation insurance rates being lowered over the ensuing five years by approximately forty-seven per cent. However, due to the rise in workers' compensation insurance rates over the past four years, the legislature believes that it is time to revisit the workers' compensation law and enact new reforms to curb rising insurance costs to employers.

The purpose of this Act is to:

SECTION 2. Section 386-21, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

"(d) If it appears to the director that the injured employee has wilfully refused to accept the services of a competent physician or surgeon selected as provided in this section, or has wilfully obstructed the physician or surgeon, or medical, surgical, or hospital services or supplies, or failed to substantially comply with a treatment plan recommended by the injured employee's health care provider, the director may consider such refusal or obstruction on the part of the injured employee to be a waiver in whole or in part of the right to medical care, services, and supplies, and may suspend the weekly benefit payments, if any, to which the employee is entitled so long as such refusal or obstruction continues. For the purposes of this subsection, "failure to substantially comply with a treatment plan recommended by the injured employee's health care provider" means an injured employee's failure to attend at least one-third of the medical or rehabilitative treatments included in a treatment plan established by the injured employee's health care provider to restore the injured employee to either fully functioning working status in the employee's former employment capacity, or in another employment capacity if the injury results in a permanent disability that prevents the injured employee from returning to the employee's former position; provided that if the injured employee can show good cause for noncompliance with a treatment plan, then the injured employee's benefits shall not be suspended pursuant to this subsection."

SECTION 3. Section 386-26, Hawaii Revised Statutes, is amended to read as follows:

"§386-26 Guidelines on frequency of treatment and reasonable utilization of health care and services. The director shall issue guidelines for the frequency of treatment and for reasonable utilization of medical care and services by health care providers that are considered necessary and appropriate under this chapter[.]; provided that with regard to chiropractic services, an employer shall only be liable for up to twenty-four visits per calendar year for each injury compensable under this chapter.

The guidelines shall be adopted pursuant to chapter 91 and shall not interfere with the injured employee's rights to exercise free choice of physicians under section 386-21.

In addition, the director shall adopt updated medical fee schedules referred to in section 386-21 and where deemed appropriate shall establish separate fee schedules for services of health care providers as defined in section 386-1 to become effective no later than June 30, 1986, in accordance with chapter 91."

SECTION 4. The director of labor and industrial relations, in collaboration with the insurance commissioner and the office of information practices, shall develop recommendations and if practicable, establish procedures to streamline the medical information release process as it relates to injuries compensable under the workers' compensation law. The recommendations and procedures shall promote the effective and efficient administration of workers' compensation claims and shall not contravene any federal law enacted to otherwise protect the personal and medical information of a patient.

The director of labor and industrial relations shall submit a report and any necessary proposed legislation to the legislature not later than twenty days prior to the convening of the 2006 regular session on the actions taken pursuant to this section.

SECTION 5. This Act does not apply to any workers' compensation claims filed before its effective date.

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect upon its approval.