HOUSE 3rd Reading Unamended March 8, 2010 HOUSE Amended 2nd Reading March 5, 2010Second Regular Session Sixty-seventh General Assembly STATE OF COLORADO REENGROSSED This Version Includes All Amendments Adopted in the House of Introduction LLS NO. 10-0209.01 Thomas Morris HOUSE BILL 10-1012 HOUSE SPONSORSHIP Pace, Miklosi, Ryden SENATE SPONSORSHIP Carroll M., Hodge, Tochtrop House Committees Senate Committees Judiciary Appropriations A BILL FOR AN ACT Concerning limitations on the use of surveillance of employees who have submitted a workers' compensation claim. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) Interim Committee to Study Issues Related to Pinnacol Assurance. Section 1 of the bill: Prohibits an insurer or employer from conducting surveillance of an employee who has submitted a workers' compensation claim unless the insurer or employer has a reasonable basis to suspect that the employee has committed fraud or made a material misstatement concerning the claim; Allows the employee to request an expedited hearing before a prehearing administrative law judge; Requires the insurer or employer to provide all materials collected during the surveillance to the injured worker and to destroy all materials collected during the surveillance unless the materials are reasonably necessary to resolve an ongoing claim of fraud; Requires persons conducting surveillance to answer the employee's questions truthfully; and Creates a $1,000-per-day penalty for violations. Section 2 of the bill: Directs the prehearing administrative law judge to issue an injunction against the surveillance unless the insurer or employer shows that it has a reasonable basis to suspect that the employee has committed fraud or made a material misstatement concerning the claim; and Allows the identity of a witness or whistleblower who provides evidence in good faith to be withheld or limited to an in camera review. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. 8-43-304 (2), Colorado Revised Statutes, is amended to read: 8-43-304. Violations - penalty - offset for benefits obtained through fraud - rules. (2) (a) An insurer or self-insured employer may take a credit or offset of previously paid workers' compensation benefits or payments against any further workers' compensation benefits or payments due a worker when the worker admits to having obtained the previously paid benefits or payments through fraud, or a civil judgment or criminal conviction is entered against the worker for having obtained the previously paid benefits through fraud. Benefits or payments obtained through fraud by a worker shall not be included in any data used for rate-making or individual employer rating or dividend calculations by any insurer or by Pinnacol Assurance. (b) (I) An insurer or employer may introduce evidence of the presence or absence of a medical condition originating in surveillance of an employee at an administrative hearing only if: (A) The insurer or employer has submitted the evidence prior to the hearing to the treating physician for review with the employee who is the subject of the surveillance. The physician shall use the evidence as one means, among others, to make recommendations regarding the employee's medical condition. (B) The administrative law judge finds that the insurer or employer had, prior to initiating the surveillance, a reasonable and articulable basis to suspect that the employee committed fraud, exceeded the employee's medically determined limitations, or made a material misstatement concerning the claim; (C) The administrative law judge does not find that the surveillance was intrusive, intimidating, or harassing; and (D) The administrative law judge does not find that the person who was conducting the surveillance affirmatively misrepresented to the employee, in response to the employee's inquiry, on whose behalf the person conducting the surveillance was acting. (II) The insurer or employer shall destroy all materials collected during the surveillance no later than five years after resolution of the claim unless the materials are reasonably necessary to resolve an ongoing claim of fraud. SECTION 2. Act subject to petition - effective date - applicability. (1) This act shall take effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 11, 2010, if adjournment sine die is on May 12, 2010); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part shall not take effect unless approved by the people at the general election to be held in November 2010 and shall take effect on the date of the official declaration of the vote thereon by the governor. (2) The provisions of this act shall apply to surveillance conducted on or after the applicable effective date of this act.