SB62 HD2.DOC

PART I

SECTION 1. Chapter 386, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§386‑ Medical examinations; selection of physicians. (a) After an injury and after a claim is filed by the injured employee, the employer, upon mutual agreement of the parties, may appoint a qualified physician, paid by the employer, to conduct an independent medical examination or a permanent impairment rating examination of the injured employee, and make a report to the employer. The employee or the employee's representative shall be promptly provided with a copy of the report of the independent medical examination or permanent impairment rating examination.

The director shall keep and maintain a list of qualified physicians and their respective qualifications. If the employer and the employee cannot agree on a physician to perform the independent medical examination or permanent impairment rating examination, the employer or employee may request in writing that the physician be appointed by the director. Within seven calendar days of the receipt of request, the director shall appoint from the director's list of qualified physicians, a physician licensed in a relevant medical specialty, licensed to practice in Hawaii, and willing to undertake the examination.

Any physician mutually selected by the employer and employee or appointed by the director shall examine the employee within forty-five calendar days of selection or appointment.

In no event shall an independent medical examination and a permanent impairment rating examination be combined into a single medical examination unless the injured employee consents in writing prior to the scheduling of the examinations.

In no event shall the director, appellate board, or court order more than one employer-requested independent medical examination and one permanent impairment rating examination per case, unless valid reasons exist with regard to the medical progress of the employee's treatment.

If an employee unreasonably refuses to submit to, or in any way unreasonably obstructs an examination, the employee's right to claim compensation for the work injury shall be suspended until the unreasonable refusal or obstruction ceases, and no compensation shall be payable for the period during which the refusal or obstruction continues. The cost of conducting the ordered independent medical examination shall be limited to the complex consultation charges governed by the medical fee schedule established pursuant to section 386-21(c).

Every physician selected to perform independent medical examinations or permanent impairment rating examinations, as provided in this subsection, shall be currently licensed in Hawaii; provided that for claimants who do not reside in Hawaii, any physician performing an independent medical examination or permanent impairment rating examination shall have been licensed in the state where the claimant resides for a period of five consecutive years immediately preceding the examination.

(b) When an injured employee has attained medical stability as determined by the injured employee's attending physician, the employer may appoint a physician, paid by the employer and selected by agreement of the parties or by appointment by the director as provided in subsection (a), who shall conduct a permanent impairment rating examination of the injured employee pursuant to subsection (a).

For the purposes of this subsection, "medical stability" means that the injured employee's medical condition is well stabilized so that no further improvement in the injured employee's work injury can be expected from further medical treatment and continued medical care will only prevent deterioration of the condition."

SECTION 2. Section 386-79, Hawaii Revised Statutes, is repealed.

["~~§386-79 Medical examination by employer's physician.~~ After an injury and during the period of disability, the employee, whenever ordered by the director of labor and industrial relations, shall submit to examination, at reasonable times and places, by a duly qualified physician or surgeon designated and paid by the employer. The employee shall have the right to have a physician or surgeon designated and paid by the employee present at the examination, which right, however, shall not be construed to deny to the employer's physician the right to visit the injured employee at all reasonable times and under all reasonable conditions during total disability.

If an employee refuses to submit to, or in any way obstructs such examination, the employee's right to claim compensation for the work injury shall be suspended until the refusal or obstruction ceases and no compensation shall be payable for the period during which the refusal or obstruction continues.

In cases where the employer is dissatisfied with the progress of the case or where major and elective surgery, or either, is contemplated, the employer may appoint a physician or surgeon of the employer's choice who shall examine the injured employee and make a report to the employer. If the employer remains dissatisfied, this report may be forwarded to the director.

Employer requested examinations under this section shall not exceed more than one per case unless good and valid reasons exist with regard to the medical progress of the employee's treatment. The cost of conducting the ordered medical examination shall be limited to the complex consultation charges governed by the medical fee schedule established pursuant to section 386-21(c)."]

PART II

SECTION 2. Section 386-1, Hawaii Revised Statutes, is amended by amending the definition of "employment" to read as follows:

""Employment" means any service performed by an individual for another person under any contract of hire or apprenticeship, express or implied, oral or written, whether lawfully or unlawfully entered into. It includes service of public officials, whether elected or under any appointment or contract of hire, express or implied.

"Employment" does not include:

(1) Service for a religious, charitable, educational, or nonprofit organization if performed in a voluntary or unpaid capacity;

(2) Service for a religious, charitable, educational, or nonprofit organization if performed by a recipient of aid therefrom and the service is incidental to or in return for the aid received;

(3) Service for a school, college, university, college club, fraternity, or sorority if performed by a student who is enrolled and regularly attending classes and in return for board, lodging, or tuition furnished, in whole or in part;

(4) Service performed by a duly ordained, commissioned, or licensed minister, priest, or rabbi of a church in the exercise of the minister's, priest's, or rabbi's ministry or by a member of a religious order in the exercise of nonsecular duties required by the order;

(5) Service performed by an individual for another person solely for personal, family, or household purposes if the cash remuneration received is less than $225 during the current calendar quarter and during each completed calendar quarter of the preceding twelve-month period;

(6) Domestic, in-home and community-based services for persons with developmental disabilities and mental retardation under the medicaid home and community-based services program pursuant to [~~title~~] Title 42 Code of Federal Regulations [~~sections~~] Sections 440.180 and 441.300, and [~~title~~] Title 42 Code of Federal Regulations, [~~part~~] Part 434, [~~subpart~~] Subpart A, as amended, and identified as chore, personal assistance and habilitation, residential habilitation, supported employment, respite, and skilled nursing services, as the terms are defined by the department of human services, performed by an individual whose services are contracted by a recipient of social service payments and who voluntarily agrees in writing to be an independent contractor of the recipient of social service payments;

(7) Service performed without wages for a corporation without employees by a corporate officer in which the officer is at least a twenty-five per cent stockholder;

(8) Service performed by an individual for a corporation if the individual owns at least fifty per cent of the corporation; provided that no employer shall require an employee to incorporate as a condition of employment; [~~and~~]

(9) Service performed by an individual for another person as a real estate salesperson or as a real estate broker, if all the service performed by the individual for the other person is performed for remuneration solely by way of commission[.];

(10) Service performed by a member of a limited liability company if the member is an individual and has a distributional interest, as defined in chapter 428, of at least fifty per cent in the company; provided that no employer shall require an employee to form a limited liability company as a condition of employment;

(11) Service performed by a partner of a partnership, as defined in chapter 425, if the partner is an individual; provided that no employer shall require an employee to become a partner or form a partnership as a condition of employment;

(12) Service performed by a partner of a limited liability partnership if the partner is an individual and has a transferable interest as defined in section 425-127 in the partnership of at least fifty per cent; provided that no employer shall require an employee to form a limited liability partnership as a condition of employment; and

(13) Service performed by a sole proprietor.

As used in this [~~paragraph~~] definition, "religious, charitable, educational, or nonprofit organization" means a corporation, unincorporated association, community chest, fund, or foundation organized and operated exclusively for religious, charitable, or educational purposes, no part of the net earnings of which inure to the benefit of any private shareholder or individual."

PART III

SECTION 3. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun, before its effective date.

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2009, and shall be repealed on July 1, 2012; provided that sections 386-1 and 386-79, Hawaii Revised Statutes, shall be reenacted in the form in which they read on the day before the effective date of this Act.

THE SENATE	S.B. NO.	62
TWENTY-FIFTH LEGISLATURE, 2009		S.D. 1
STATE OF HAWAII		H.D. 2