House Business & Industry met on May 25 to hear public and invited testimony on the following interim charges:

  • Conduct active oversight of all associated rulemaking and other governmental actions taken to ensure the intended legislative outcome of all legislation, including the following: SB 22 relating to certain claims for benefits, compensation, or assistance by certain public safety employees and survivors of certain public safety employees
  • Study workers’ compensation claims involving public safety employees described by SB 22. This study should include an analysis of medical costs, return-to-work outcomes, utilization of care, satisfaction with care, and health-related functional outcomes

An archive of this hearing can be found here.

This report is intended to give you an overview and highlight of the discussions on the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.

 

Opening Comments

  • Chair Turner – Written comments can be submitted electronically; directions can be found on the hearing notice
  • Before the interim charges will bring up TDI to discuss the recent TDI workers compensation data breech

 

Cassie Brown, Commissioner TDI

  • Workers’ compensation web application had recent data breech which exposed personal data
  • Response to such an incident followed statutory requirements
  • TDI’s reporting of the issue was not prompted by the SAO’s audit
  • TDI became aware of the issue on January 4 from a report from a user
  • Immediately took the application offline
  • Types of information that may have been breached: names, addresses, dates of birth, phone numbers, social security numbers, information about injuries and workers compensation claims
  • Worked with a forensic company and found no evidence of misuse of data
  • Are offering 12 months of credit monitoring and identity protection services to those who may have been affected
  • Working to prevent such incidents in the future
  • Chair Turner – Forensic team has not found any indication the data has been mis-used?
    • Correct
  • Chair Turner – Know if anyone accessed the data?
    • We do not; other than the initial worker who was able to access their information from another platform
  • Chair Turner – Was January 4 when you knew, when were people notified? Why the lag time?
    • Sent out notification on March 24; B&C code prescribes the timing of notifications and investigated before notification
  • Chair Turner – B&C code prescribes specifically you have to know scope and investigate before?
    • Is in B&C Code 521; we wanted to investigate scope before notification
  • Shine – How long are you providing services?
    • 12 months; contracted with a vendor to provide counseling services
    • Was a coding error in the application not a hack from an outside entity
    • Work with outside vendors for training, security, etc.
  • Shine – Will need additional resources to address this?
    • At this time have resources available; are talking to other experts on how to improve
  • Shine – What experts?
    • DIR, have a security policy, SAO, own internal audit
  • Chair Turner – Appreciates the department’s attention on this; legislature wants to ensure all sensitive information is protected

Conduct active oversight of all associated rulemaking and other governmental actions taken to ensure the intended legislative outcome of all legislation, including the following: SB 22 relating to certain claims for benefits, compensation, or assistance by certain public safety employees and survivors of certain public safety employees

 

Study workers’ compensation claims involving public safety employees described by SB 22. This study should include an analysis of medical costs, return-to-work outcomes, utilization of care, satisfaction with care, and health-related functional outcomes

 

Dan Paschal, TDI

  • Provides an overview of how workers compensation functions in the state
  • Will discuss SB 22 first; went into effect on June 14, 2021
  • Allows COVID-19 worker compensation claims to fall under presumption and allows those that have been previously denied to be re-processed
  • Includes state employees of DPS and TDCJ; flips the presumption from employees to employers
  • Created new claims processing documents and notices
  • Bill requires a study on the impacts which will be ready later this year
  • Sent notices to tell them if they have a claim it needs to be re-processed by June 14, 2022
  • New claims with dates of injury after the date of the bill 18.5k by public safety employees
    • Political subdivision has the largest amount of claims with 16k and lowest denials
  • 22k claims that were filed before SB 22 that were initially denied; after SB 22 12.4k were denied
    • SORM denied 87%
    • Have 143 reprocessed requests; 96 accepted and 44 denied
  • Police officers had the highest claims followed by firefighters and EMS
  • Medical benefits were the cost drivers
  • Patterson – Burden of proof is on employer, not employee; information to employers on rebuttals?
    • Would be the job of employers’ workers insurance company
  • Patterson – Educate insurance companies on the rebuttal piece?
    • Jeff Nelson, TDI – Informed them of the impact of the bill, no specific information on rebuttal of claims
  • Patterson – How does an insurance company gather evidence?
    • Jeff Nelson, TDI – Are allowed to request medical records from the employee
  • Chair Turner – Noted political subdivisions had a low denial of claims; why more state of Texas claims have been denied?
    • Each claim is fact-specific; would be a better question for SORM
  • Chair Turner – State employees include correctional officers, DPS, and who else?
    • Any other agency who has an eligible public safety employee; would be a much smaller pool
  • Shine – National Guard soldiers included in this on the border?
    • If they are under state orders are under SORM
  • Will now discuss the other interim charge
  • Collect a large number of data, but will be able to provide specific information in the fall
  • Conduct an injured employee’s satisfaction survey expanded survey to first responders and detention officers and will be available later this year
  • Multiple different definition for first responders and public employees
  • Provides the committee with a table of claim denials broken out by employment
  • FY 20-21 were impacted by COVID-19 claims; denials can be due to lack of evidence
  • Less than 5% of claims are disputed to TWC
  • Injured employees are not responsible for any payment
  • FY 17-21 $2.9b medical benefits were paid system-wide; first responders accounted for $350m of that
  • Chair Turner – Why non-public safety employee’s denials are 4-5% lower than public safety employees?
    • Is fact-specific and there are differences between carriers
  • Chair Turner – Has the department looked more closely at that data? A certain employer denies more?
    • Can get the committee a breakdown by carrier
  • Chair Turner and Paschal discuss the benefit review conference process
  • Patterson – What is the timeline of that process? When do they request the review conference?
    • Dispute process is on average less than 135 days
    • Jeff Nelson, TDI – After consulting with a lawyer/advisor; some are not requested until 6 months after the injury
  • Patterson – Time it takes to be injured and denied? Many only have a maximum of a year to get back to work
    • Jeff Nelson, TDI – Can get you that data
  • Cain – Track data on risk-pools; would like to break it down by city and county to see where these requests are coming from
    • Jeff Nelson, TDI – Can break it down by individual insurance carrier
  • Chair Turner – Evidence an insurance carrier was unfairly denying claims; what recourse does the agency have on that?
    • Ask participants to submit a claim so we can investigate; have a number of enforcement tools from a warning to an administrative fine
  • Chair Turner – What do those fines run? How often does the department administer fines?
    • Vary since they are fact-specific
    • Is continuous and on this specific issue there are more rare complaints

 

Deea Western, SORM

  • Are the workers compensation carrier for most Texas state employees
  • Are 184k state employees covered under our statutory program; in some instances non-state employees are covered
  • Had a large number of claims in 2020; assigned most claims in one day in July 2020
  • Have information on COVID-19 workers compensation claims
  • 5k claims fall under SB 22; majority are new claims after the effective date
  • 78 claims were requested to be re-processed and do expect some additional requests
    • June 14, 2022 is the claim re-processing deadline
  • Chair Turner – Rate of denials for the state compared to other carriers?
    • Do not have specific data on denial reasons; are limited on data
    • Number of claims include exposure-only reports and duplicate submissions
  • Chair Turner – Provides Western with TDI’s data on denial of claims
    • Data is a little different than TDI’s is through March 21, 2022
    • Have received 92 death claims and accepted 57
    • At each level of assessment are many reasons why they would not apply to SB 22
    • Dan Paschal, TDI – Reason for difference is we provided a subset of data for public safety employees

 

Jessica Barta, Office for Injured Employee Council

  • Provides an overview of OIEC; is the advocate for employees and assist in over half the cases in the dispute process
  • Are actively aiding 110-125 first responders at any given time
  • Responded to 85% first responder claims in 2021 and 80% in 2020
  • SB 22 is meeting its statutory goals
  • Bulk of COVID-19 claims were those who worked in jails
  • Chair Turner – Have insight why state denials is higher percentage wise than local governments?
    • Do not know the specifics why, but we do see that
    • Saw some carriers tying COVID-19 claims to life events rather than on-the-job exposure
  • Patterson – Work with first responders with the rebuttal process?
    • Yes, walk them through the super technical paperwork process
  • Patterson – Reports on first responders on how insurance companies gather facts?
    • Have seen private investigators, pictures, previous medical records with pre-existing conditions, peer-reviews
    • Burden of proof on employees requires a causal link that requires medical evidence
  • 95% of the overall system of the system works great
  • System is very technical and need to make sure we are keeping up with technical advances sine more people are using online platforms to get service
  • Required statutorily to make recommendations to the legislature
  • Made a recommendation related to causation that passed the house, but did not pass the senate; will make that recommendation again
  • Chair Turner – Expand on that; bill is the number one recommendation?
    • Worked with stakeholders to allow individuals to get one causation per claim
    • Currently doctors have to do that for free or injured
    • Yes – HB 2326 85(R) placed limitations on how much a doctor could charge, but did not require a doctor to draw that causation

 

Charley Wilkinson, Combined Law Enforcement Associations of Texas

  • Comments are limited to SB 22; intent was to establish a presumption that lifted first responder burden
  • Notes before one COVID-19 death occurred were looking for protections for those on the front lines
  • Some employers say COVID-19 was not covered even after SB 22 was signed into law
  • Some political subdivisions worked with insurance carriers to slow down claims
  • In many cases the statutory intent of SB 22 has been willfully ignored
  • Pre SB 22 55% of COVID-19 claims were denied and only 1% have been re-processed
  • Patterson – What solutions do you offer?
    • Asks for continual legislative pressure; will have specific recommendations near session
  • Patterson – Does CLEAT have lawsuits out?
    • Yes, filing several individual cases
  • Chair Turner – You noted that many did not know they could re-apply; previous notification was adequate?
    • Notification was not sufficient; plain language was not clear enough
    • Legislature’s will was not done
  • Chair Turner – Think TDI’s enforcement measures are enough?
    • Would like to see if any carrier has received a fine related to SB 22
    • Do not think enforcement measures are effective
  • Cain – Had concerns with this bill and is evidence that we over-estimated this thing; need to call out those disregarding the will of the legislature
  • Ordaz-Perez – Mentioned pending cases are not considered a denial; are these re-processed?
    • Are those within 60-day investigative period, but would assume those would be denied
  • Chair Turner – Mentioned local governments are not following this law; is across the board?
    • Is across the board; larger urban centers have a better chance in having claims processed
    • Would like to see more data on this; is still pressure to presume when they contracted COVID-19
  • Chair Turner – If insurance carriers or others are not following the law needs to be reported to TDI; and if TDI has no enforcement then we need to consider that next session

 

John Wilkerson, Texas Municipal Police Association

  • SB 22 was a wonderful piece of legislation and needs to stay; have a couple recommendations
  • 168 Texas law enforcement officers have died from COVID-19 and this number will grow
  • Many political subdivisions are denying claims; has slightly decreased since SB 22
  • Members have reported they have been essentially interrogated about presumption
  • Some HR has gotten guidance from insurance carriers to push for presumption information
  • Workers compensation insurance companies are not doing what is right; are just looking at their bottom line
  • Hired an attorney that will provide the legislature with information on what to do to fix this
  • Notes in 2005 workers compensation insurance’s lobby weakened reforms
  • Have a number of people here today to tell you their story
  • Recommend looking into reforms related to attorneys who represent employees
  • Recommend extending SB 22 from September 2023 at least until the next legislative session
  • Recommend removing requirement to qualify need to have contracted while the governor has issued a disaster declaration
  • Should re-consider why the bill only currently covers those working full time
  • HB 2073 for other injuries
  • Patterson and Wilkerson discuss examples of insurance carriers taking the rebuttal process too far

 

Michael Glynn, Fort Worth Professional Firefighters Association and Texas State Association of Firefighters

  • SB 22 and HB 2073 are two-pronged approach to address COVID-19 infections
  • No issues with the bill itself, major issues are issues with local laws and the adherence to SB 22
  • Should address those who will never return back to work; should extend the bill to 2025
  • Chair Turner – See disparity?
    • Not seeing widespread denials in Fort Worth
  • Lambert – Workforce shortages related to this issue?
    • Cannot say for sure, but are seeing those who are second guessing this career
    • Exposure to carcinogens also is a concern in the field
  • Lambert – Tweaking SB 22 would be beneficial to your profession?
    • Yes
  • SB 2551 has caused denial rates to go below 55%; law should reflect some tobacco users
  • Still having issues with heart attack denial; state law needs to be clarified since cardiac events do not always occur at the time of stress
  • Need to reassess lifetime income benefits like in HB 3120 87(R)
    • Bill passed the house not the senate
  • Lack of cardiologists and PT in the workers compensation system

 

Clifton Buchanan, Texas Correctional Employee Employees Council 907

  • Thanks the committee for their work in passing SB 22; has given employees peace of mind
  • COVID-19 is still taking a toll on TDCJ
  • 22k positive cases among staff and 86 employees have died since 2020
    • Have been 45k positive cases among inmates
  • Was significant confusion when the bill was first enacted especially around re-filing claims
    • Has been worked out over time
  • In the future need to take care that all staff are fully trained on new procedures
  • State should do more to expand the network of care and provide more options; especially in rural areas like Gatesville
  • Need to improve communication between claims adjustors and employees
  • Appeals process is inexcusably slow; employees face significant pressure to return
  • Have agency-wide vacancies; could allow administration to cover light duties
  • Patterson – What is the average salary for corrections officer? Seems like many of these folks would have to find another job during the long appeals process
    • Start off around $41k; some are doing leave without pay
    • Many do what they can to get back to work and come back to work injured
  • Patterson – Would like to learn more about a way to address that next session
  • Lambert – What happens with an employee who runs into the roadblock of not being able to find a provider?
    • Try to refer them to doctors further out, but some cannot drive
    • Some just have to wait and further delay the process

 

David Reagan, Texas Municipal League Intergovernmental Risk Pool

  • TMLIRP was created in order to provide workers compensation benefits; are not a for-profit entity
  • February 2020 made the decision to treat COVID-19 claims under the presumption statute and started paying claims in March
  • 7k first responder COVID-19 claims have been filed and accepted 95% of those claims; $90m and $70m of that is for indemnity benefits
  • $162m for
  • 30k claims and accepted 94%; $126m
  • 210k covered under the pool; majority are the
  • 62k total claims and accepted 91%; first responders are 22.5% of that pool
  • COVID-19 claims 92% of all claims; 83.3% of which was first responders
  • Have 15 days to accept or deny a claim; if need additional time need a notice of continuation for 60 days
  • Chair Turner – Saw a decrease in case denial because of SB 22?
    • Had a spike in denials in 2020 and 2021 because of exposure-only claims; they also may have not met the 15 days at work requirement
  • Chair Turner – Gone back to those who were denied to tell them they can re-file?
    • Do not know
  • Chair Turner and Reagan discussed the spike in claims from 2021-2022 due to Omicron variant
  • Patterson – Commit to notifying all your member organizations about the June 14 deadline?
    • Yes
  • Ordaz Perez – Any data in relation to those that are pending?
    • Do not have data on that
  • Ordaz Perez – What is the typical timelines on those that are pending?
    • Depends on how quickly we verify if they meet requirements of SB 22

 

Charles Reed, Dallas County

  • Believe we approved all claims covered by SB 22
  • Federal COVID-19 funds have been used to cover county costs; are no state funds
  • Asks the legislature to extend SB 22 to December 2024 or to provide political jurisdictions funding that is incurred by SB 22 passing
  • Month of April disbursed $16k in compensation claims; in total have paid out $2.9m
  • Have asked the Treasury on clarification on if we can purchase an annuity to pay out
  • If that does not occur ask the legislature to allow lump sums for debt payments; so it is not a liability on property tax levies going forward
  • Chair Turner – Mainly jailers using this system?
    • Mainly jailers in the sheriff’s department
  • Chair Turner and Reed discuss federal funding initially through CARES and now ARPA Federal funds are covering that 100%
    • Without further state/federal investment will have to come from property taxes
    • Lambert – Asks about the property tax increase
    • Would be about a 1% property tax increase
  • Chair Turner – How much would this cost be?
    • About $3.5m-$4m per year assuming there will be spikes

 

Public Testimony

Dylan Woods, Cedar Park Police Officer’s Association

  • Provides an example of a member that was diagnosed with long COVID which has affected his ability to work
  • Chair Turner and Woods discussed the resources used and could be used in this case

 

Rachel Vega, Self

  • Widow of a sheriff who died from COVID-19 in 2020; claim has continued to be denied
  • Despite SB 22’s passage nothing happened; hired an attorney in August 2021 and filed another appeal and nothing has happened
  • Husbands’ previous employer and Texas Association of Counties have done nothing but fought the appeal
  • Chair Turner and Vega discussed the continued denial of her claim
  • Lambert – Have an estimate of out-of-pocket expenses?
    • Do not have out of pocket expenses

 

Brad McClelland, Self

  • Rachel Vega’s lawyer; workers’ compensation system in the state is broken due to tort reform
    • Have made it impossible for lawyers to help workers in this system

 

Michelle Brown, Self

  • Widow of an investigator for Harris County; claims were continuously denied
  • Had a contested case hearing and they did rule in my favor; insurance carrier still can file an appeal
  • Have worked with the OIEC, but the system is disheartening

 

Jason Spencer, Self

  • Is a misconception that a presumption creates a compensable claim
  • In the process there is accountability for insurance companies wrongfully denying a case
  • Claims should be sent to TDI for tracking purposes
  • Need to get those re-filings back into the system and account for them

Pauline Pezina de la Fuente, Self

  • Widow of a peace officer and detention officer in Bexar County
  • Have had an administrative law judge twice rule in favor of my workers compensation claim
  • Bexar County suing the deceased and myself for funeral costs and cost of
  • death benefits
  • Do not understand why this is happening even though SB 22 has passed
  • Chair Turner – Are in court right now?
    • Waiting for a court date

 

Angie Multer, Self

  • Widow of a police officer who died from COVID-19 in the line of duty; case has finally been resolved
  • Husband’s office was extremely supportive otherwise would not have gotten through the paperwork
  • Used the ombudsman, but eventually had to hire an attorney to get through the continuous denials of the claim

 

Noel Johnson, Self

  • Was the supervisor of officer Multer; put a COVID-19 policy in place in order to count COVID-19 deaths in the line of duty
  • Need to ensure SB 22 is truly presumptive so people do not “have to fight to the bitter end”
  • Need to ensure everyone is properly notified on the timelines for re-filing