Source: https://leg.mt.gov/bills/1997/Bills/Senate/SB0067_02.htm
Timestamp: 2018-06-18 19:11:11
Document Index: 94396139

Matched Legal Cases: ['art 23', 'art 4', 'arts 2', 'art 4', 'art 10', 'art 10', 'art 4', 'arts 2', 'art 4', 'art 10', 'art 10', 'art 4', 'arts 1', 'art 1']

A Bill for an Act entitled: "An Act Generally Revising Workers' Compensation Laws; increasing to seven members the state compensation insurance fund board and authorizing a licensed insurance producer member; providing for merger of the old and new fund accounts THE TRANSFER OF $63.8 MILLION TO THE OLD FUND ACCOUNT; providing a contingency for terminating the old fund liability tax on employers, employees, and self-employed persons effective January 1, 1999; requiring assumption of the old fund claim liability by the state fund WHEN THE OLD FUND IS ADEQUATELY FUNDED; REMOVING THE LIMITATION ON THE PAYMENT OF DIVIDENDS BY THE NEW FUND; PROVIDING THAT THE AMOUNTS IN EXCESS OF ADEQUATE FUNDING OF THE OLD FUND ARE RETURNED TO THE NEW FUND ACCOUNT AND THAT ANY SHORTFALL IN ADEQUATE FUNDING IS RETURNED TO THE OLD FUND IN AN AMOUNT EQUAL TO THAT RETURNED TO THE NEW FUND; clarifying the definition of "dependent" for fatal injury beneficiary claims; providing that an insurer's failure to meet time limitations is not an acceptance of the claim; increasing compensation for permanent partial disability; providing that a worker who has not reached maximum healing but who is released by a treating physician and refuses the offer of employment in a modified or alternative position at an equivalent or higher wage is not eligible for temporary partial or temporary total disability benefits; increasing access to rehabilitation benefits PROVIDING FOR FRAUD INVESTIGATION AND PROSECUTION FOR THE UNINSURED EMPLOYERS' FUND BY THE DEPARTMENT OF JUSTICE; DEFINING "TREATING PHYSICIAN" TO INCLUDE THOSE PHYSICIANS LICENSED IN OTHER STATES; INCLUDING PSYCHOLOGISTS AND FUNCTIONAL CAPACITY EVALUATIONS AND PROVIDING FOR EXAMINATIONS BY LICENSED PROVIDERS IN ANOTHER STATE WHEN EXAMINATIONS ARE REQUESTED BY THE INSURER; ADJUSTING THE LIFTING REQUIREMENT FOR LIGHT ACTIVITY FOR PERMANENT PARTIAL DISABILITY BENEFITS; authorizing the state fund to provide "other states" coverage; clarifying the state fund's use of licensed insurance producers; requiring that the state fund repay $20 million to the general fund; clarifying the types of administrative expenditures used in determining the state fund's 15 percent limitation PROVIDING FOR UP TO ONE-HALF OF THE PRIOR YEAR'S INVESTMENT INCOME FOR ADMINISTRATIVE EXPENDITURES AND FOR REVIEW BY THE LEGISLATIVE FINANCE COMMITTEE; limiting the time for bringing an action to resolve a benefits dispute; requiring the state fund and, the department of justice, AND THE DEPARTMENT OF LABOR AND INDUSTRY to file a joint biennial budget for the workers' compensation fraud office; providing for transfer of the balance in the workers' compensation bond repayment account on June 30, 1997, to the state fund; amending sections 2-15-1019, 2-15-2015, 15-30-207, 17-7-502, 33-1-1205, 33-16-1024, 39-71-116, 39-71-318, 39-71-406, 39-71-502, 39-71-605, 39-71-606, 39-71-703, 39-71-712, 39-71-1006, 39-71-2316, 39-71-2320, 39-71-2321, 39-71-2322, 39-71-2323, 39-71-2327, 39-71-2361, 39-71-2351, 39-71-2352, 39-71-2363, 39-71-2501, 39-71-2503, 39-71-2505, and 39-71-2905, MCA; repealing sections 39-71-2351, 39-71-2352, 39-71-2354, 39-71-2355, 39-71-2501, 39-71-2502, 39-71-2503, 39-71-2504, 39-71-2505, and 39-71-2506, MCA; and providing effective dates, applicability dates, and a contingent termination date DATES."
WHEREAS, it is the intent of the state compensation insurance fund to assist all Montanans by eliminating REDUCING the unfunded liability of the old fund, terminating the old fund liability tax as early as January 1, 1999, but no later than January 1, 2000 WHEN THE OLD FUND IS ADEQUATELY FUNDED, WHICH IS CURRENTLY ESTIMATED TO OCCUR AS EARLY AS JUNE 30, 1999, providing for the payment of dividends to policyholders, and maintaining a viable state compensation insurance fund; and
WHEREAS, there was an unfunded liability of $355 million as of June 30, 1996, for claims for workers' compensation injuries occurring before July 1, 1990, in the old fund, which included $129 million in outstanding bond debt; and
WHEREAS, the old fund is funded with the old fund liability tax paid by employers, employees, and self-employed persons, generating as much as $50 million each year; and
WHEREAS, the surplus of $231 in the new fund as of June 30, 1996, allowed the Board of Directors of the State Fund to declare a dividend of up to $109 million to retire the outstanding bond debt in the old fund; and
WHEREAS, the unfunded liability in the old fund will be an estimated $200 million deficit by June 30, 1997, and the surplus or the excess of assets above the reserves that are set aside to meet the claim liability in the new fund will be an estimated $127 million by June 30, 1997; and
WHEREAS, current state law requires the State Fund to use dividends to be applied first to old fund outstanding liability rather than paying dividends directly to policyholders, and merger of the old fund and new fund claims will allow new fund surplus to fully fund the THE STATE FUND SHALL TRANSFER $63.8 MILLION TO THE OLD FUND ACCOUNT TO PAY old fund claims, allowing TO ALLOW direct payment of dividends to policyholders after elimination of the old fund liability tax; and
WHEREAS, combining the old and new funds into a combined State Fund and eliminating the old fund liability tax by the end of the 1998 calendar year could save taxpayers an estimated $69 million in old fund liability tax payments; and
WHEREAS, the $20 million appropriation received by the State Fund from the general fund during the June 1989 Special Session partially addressed the unfunded liability issue existing at that time in the old fund and canceled a planned 22% rate increase; and
WHEREAS, the State Fund now agrees to repay the $20 million appropriation TO THE GENERAL FUND IN LIEU OF TRANSFERRING ADDITIONAL FUNDS TO THE OLD FUND ACCOUNT to provide the general fund with additional revenue and to remove any perception that the State Fund remains a burden on the general fund; and
WHEREAS, because decreases in premium rates totaled 35% in fiscal years 1996 and 1997 and legislative changes in benefit levels have resulted in the return of private carriers, the 15% limitation on administration expenses as a percent of the prior year's premium will significantly impact the State Fund's ability to provide service to policyholders and their injured workers; and
WHEREAS, the State Fund seeks to improve the level of services provided to customers without increasing existing State Fund staffing levels by working with private sector-licensed insurance producers; and
WHEREAS, in response to Haag v. Montana Schools Group Insurance Authority, 274 M 109, 906 P.2d 693 (1995), in which the Montana Supreme Court ruled that an insurer's failure to comply with the time limitations for filing ACCEPTING OR DENYING a workers' compensation claim constituted acceptance of the claim, current law needs to be clarified to provide that the failure to comply with filing THE time limitations does not constitute acceptance of the claim.
Section 1. Section 2-15-1019, MCA, is amended to read:
"2-15-1019. Board of directors of the state compensation insurance fund. (1) There is a board of directors of the state compensation insurance fund.
(4) The board consists of five seven members appointed by the governor. The executive director of the state fund is an ex officio nonvoting member.
(5) At least three four of the five seven members shall must represent state fund policyholders and may be employees of state fund policyholders. At least three four members of the board shall represent private, for-profit enterprises. One of the seven members may be a licensed insurance producer. A member of the board may not:
(a) except for the licensed insurance producer member, represent or be an employee of an insurance company that is licensed to transact workers' compensation insurance under compensation plan No. 2; or
(b) be an employee of a self-insured employer under compensation plan No. 1.
(7) The members must be appointed and compensated in the same manner as members of a quasi-judicial board as provided in 2-15-124, except that the requirement that at least one member be an attorney does not apply."
Section 2. Section 2-15-2015, MCA, is amended to read:
"2-15-2015. Workers' compensation fraud office. There is a workers' compensation fraud investigation and prosecution office in the department of justice. The office shall investigate and prosecute cases referred by the state compensation insurance fund OR THE DEPARTMENT OF LABOR AND INDUSTRY ON BEHALF OF THE UNINSURED EMPLOYERS' FUND. The office is under the supervision and control of the attorney general and consists of:
(1) four persons one or more investigators qualified by education, training, experience, and high professional competence in investigative procedures who shall investigate violations of the provisions of Title 39, chapters 71 and 72, at the request of the state compensation insurance fund OR THE DEPARTMENT OF LABOR AND INDUSTRY ON BEHALF OF THE UNINSURED EMPLOYERS' FUND; and
(2) one person one or more attorneys licensed to practice law in Montana who shall prosecute violations of the provisions of Title 39, chapters 71 and 72. The attorney attorneys may also assist county attorneys in prosecuting violations of Title 39, chapters 71 and 72, without charge to the county.
(3) The state compensation insurance fund, THE DEPARTMENT OF LABOR AND INDUSTRY, and the department of justice shall jointly submit to the legislature for approval a ONE proposed biennial budget for the workers' compensation fraud office. The proposed budget for staffing and related expenses must be based upon the needs of the state compensation insurance fund AND THE DEPARTMENT OF LABOR AND INDUSTRY ON BEHALF OF THE UNINSURED EMPLOYERS' FUND for investigating and prosecuting workers' compensation fraud."
Section 3. Section 15-30-207, MCA, is amended to read:
"15-30-207. Annual statement by employer. (1) Every employer shall, on or before February 28 in each year, file with the department a wage and tax statement for each employee in such form and summarizing such the information as that the department requires, including the total wages paid to the employee during the preceding calendar year or any part thereof of the year and showing the total amount of the federal income tax deducted and withheld from such the wages and the total amount of the tax deducted and withheld therefrom under the provisions of 15-30-201 through 15-30-209 and 39-71-2503.
(2) The annual statement filed by an employer with respect to the wage payments reported constitutes full compliance with the requirements of 15-30-301 relating to the duties of information agents, and no additional information return is not required with respect to such the wage payments.
(3) In addition to any other penalty provided by law, the failure of an employer to furnish a statement as required by subsection (1) subjects the employer to a penalty of $5 for each failure, provided that; however, the minimum penalty for failure to file the statements required on or before February 28 of each year shall be is $50. This penalty may be abated by the department upon a showing of good cause by the employer. The penalty may be collected in the same manner as are other tax debts."
Section 3. Section 17-7-502, MCA, is amended to read:
Section 4. Section 33-1-1205, MCA, is amended to read:
"33-1-1205. Duties of authorized insurers, adjusters, administrators, consultants, and producers -- notice exception. (1) Each insurer, independent adjuster, independent administrator, independent consultant, and independent producer shall cooperate fully with the commissioner with respect to the provisions of this part.
(2) An Except as provided in subsection (4), an insurer, an officer, employee, or producer of the insurer, an independent adjuster, an independent administrator, an independent consultant, or an independent producer who has reason to believe that an insurance fraud has been or is being committed shall provide notice of the alleged insurance fraud to the commissioner within 60 days.
(3) Notice to the commissioner by an insurer who has reason to believe that an insurance fraud has been committed in connection with an insurance claim, application, or policy tolls any applicable time period, for the commissioner, in any applicable insurance statute, related insurance regulation, or applicable sections of the criminal code and tolls any time period arising under 33-18-232 or 33-18-242 regarding unfair claims settlement practices.
(4) Notice of an alleged insurance fraud involving an insurance claim or application submitted to the state compensation insurance fund or a policy issued by the state compensation insurance fund must be made within 60 days to the fraud detection and prevention unit established pursuant to 39-71-211."
Section 5. Section 33-16-1024, MCA, is amended to read:
"33-16-1024. Plan No. 3 membership in licensed workers' compensation advisory organization -- reporting requirements. (1) The plan No. 3 insurer under Title 39, chapter 71, part 23, is required to be a member of a licensed workers' compensation advisory organization or a licensed workers' compensation rating organization under Title 33, chapter 16, part 4.
(2) If the plan No. 3 insurer is not a member of the workers' compensation advisory organization designated under 33-16-1023, then, subject to the deviations from the uniform statistical plan, uniform classification system, and uniform experience rating plan that may be approved by the board of directors of the plan No. 3 insurer as provided in 39-71-2316(5)(1)(e), the insurer shall:
(a) record and report its workers' compensation experience to the designated advisory organization as required in the uniform statistical plan of the designated workers' compensation advisory organization approved by the commissioner, the uniform classification system, and the uniform experience rating plan that have been filed by the designated advisory organization with and approved by the commissioner; and
(b) use the forms and adhere to the rules that the designated advisory organization develops and files with the commissioner under 33-16-1023."
Section 6. Section 39-71-116, MCA, is amended to read:
(3)(2)(3) "Aid or sustenance" means any public or private subsidy made to provide a means of support, maintenance, or subsistence for the recipient.
(4)(3)(4) "Average weekly wage" means the mean weekly earnings of all employees under covered employment, as defined and established annually by the department. It is established at the nearest whole dollar number and must be adopted by the department prior to July 1 of each year.
(5)(4)(5) "Beneficiary" means:
(6)(5)(6) "Casual employment" means employment not in the usual course of the trade, business, profession, or occupation of the employer.
(7)(6)(7) "Child" includes a posthumous child, a dependent stepchild, and a child legally adopted prior to the injury.
(8)(7)(8) "Construction industry" means the major group of general contractors and operative builders, heavy construction (other than building construction) contractors, and special trade contractors, listed in major groups 15 through 17 in the 1987 Standard Industrial Classification Manual. The term does not include office workers, design professionals, salespersons, estimators, or any other related employment that is not directly involved on a regular basis in the provision of physical labor at a construction or renovation site.
(9)(8)(9) "Days" means calendar days, unless otherwise specified.
(10)(9)(10) "Department" means the department of labor and industry.
(11)(10)(11) "Fiscal year" means the period of time between July 1 and the succeeding June 30.
(12)(11)(12) "Household or domestic employment" means employment of persons other than members of the household for the purpose of tending to the aid and comfort of the employer or members of the employer's family, including but not limited to housecleaning and yard work, but does not include employment beyond the scope of normal household or domestic duties, such as home health care or domiciliary care.
(13)(12)(13) "Insurer" means an employer bound by compensation plan No. 1, an insurance company transacting business under compensation plan No. 2, or the state fund under compensation plan No. 3.
(14)(13)(14) "Invalid" means one who is physically or mentally incapacitated.
(15)(14)(15) "Limited liability company" is as defined in 35-8-102.
(16)(15)(16) "Maintenance care" means treatment designed to provide the optimum state of health while minimizing recurrence of the clinical status.
(17)(16)(17) "Medical stability", "maximum healing", or "maximum medical healing" means a point in the healing process when further material improvement would not be reasonably expected from primary medical treatment.
(18)(17)(18) "Objective medical findings" means medical evidence, including range of motion, atrophy, muscle strength, muscle spasm, or other diagnostic evidence, substantiated by clinical findings.
(19)(18)(19) "Order" means any decision, rule, direction, requirement, or standard of the department or any other determination arrived at or decision made by the department.
(20)(19)(20) "Palliative care" means treatment designed to reduce or ease symptoms without curing the underlying cause of the symptoms.
(21)(20)21 "Payroll", "annual payroll", or "annual payroll for the preceding year" means the average annual payroll of the employer for the preceding calendar year or, if the employer has not operated a sufficient or any length of time during the calendar year, 12 times the average monthly payroll for the current year. However, an estimate may be made by the department for any employer starting in business if average payrolls are not available. This estimate must be adjusted by additional payment by the employer or refund by the department, as the case may actually be, on December 31 of the current year. An employer's payroll must be computed by calculating all wages, as defined in 39-71-123, that are paid by an employer.
(22)(21)(22) "Permanent partial disability" means a physical condition in which a worker, after reaching maximum medical healing:
(23)(22)(23) "Permanent total disability" means a physical condition resulting from injury as defined in this chapter, after a worker reaches maximum medical healing, in which a worker does not have a reasonable prospect of physically performing regular employment. Regular employment means work on a recurring basis performed for remuneration in a trade, business, profession, or other occupation in this state. Lack of immediate job openings is not a factor to be considered in determining if a worker is permanently totally disabled.
(24)(23)(24) The "plant of the employer" includes the place of business of a third person while the employer has access to or control over the place of business for the purpose of carrying on the employer's usual trade, business, or occupation.
(25)(24)(25) "Primary medical services" means treatment prescribed by a treating physician, for conditions resulting from the injury, necessary for achieving medical stability.
(26)(25)(26) "Public corporation" means the state or any county, municipal corporation, school district, city, city under a commission form of government or special charter, town, or village.
(27)(26)(27) "Reasonably safe place to work" means that the place of employment has been made as free from danger to the life or safety of the employee as the nature of the employment will reasonably permit.
(28)(27)(28) "Reasonably safe tools and appliances" are tools and appliances that are adapted to and that are reasonably safe for use for the particular purpose for which they are furnished.
(29)(28)(29) (a) "Secondary medical services" means those medical services or appliances that are considered not medically necessary for medical stability. The services and appliances include but are not limited to spas or hot tubs, work hardening, physical restoration programs and other restoration programs designed to address disability and not impairment, or equipment offered by individuals, clinics, groups, hospitals, or rehabilitation facilities.
(b) (i) As used in this subsection (29) (28) (29), "disability" means a condition in which a worker's ability to engage in gainful employment is diminished as a result of physical restrictions resulting from an injury. The restrictions may be combined with factors, such as the worker's age, education, work history, and other factors that affect the worker's ability to engage in gainful employment.
(30)(29)(30) "Sole proprietor" means the person who has the exclusive legal right or title to or ownership of a business enterprise.
(31)(30)(31) "Temporary partial disability" means a physical condition resulting from an injury, as defined in 39-71-119, in which a worker, prior to maximum healing:
(32)(31)(32) "Temporary service contractor" means a person, firm, association, partnership, limited liability company, or corporation conducting business that hires its own employees and assigns them to clients to fill a work assignment with a finite ending date to support or supplement the client's workforce in situations resulting from employee absences, skill shortages, seasonal workloads, and special assignments and projects.
(33)(32)(33) "Temporary total disability" means a physical condition resulting from an injury, as defined in this chapter, that results in total loss of wages and exists until the injured worker reaches maximum medical healing.
(34)(33)(34) "Temporary worker" means a worker whose services are furnished to another on a part-time or temporary basis to fill a work assignment with a finite ending date to support or supplement a workforce in situations resulting from employee absences, skill shortages, seasonal workloads, and special assignments and projects.
(35)(34)(35) "Treating physician" means a person who is primarily responsible for the treatment of a worker's compensable injury and is:
(c) a physician assistant-certified licensed by the state of Montana under Title 37, chapter 20, if there is not a physician, as defined in subsection (35)(a) (34)(a) (35)(A), in the area where the physician assistant-certified is located;
(e) a dentist licensed by the state of Montana under Title 37, chapter 4; OR
(F) FOR A CLAIMANT RESIDING OUT OF STATE OR UPON APPROVAL OF THE INSURER, A TREATING PHYSICIAN DEFINED IN SUBSECTIONS (35)(A) THROUGH (35)(E) WHO IS LICENSED OR CERTIFIED IN ANOTHER STATE.
(36)(35)(36) "Year", unless otherwise specified, means calendar year."
Section 7. Section 39-71-318, MCA, is amended to read:
"39-71-318. Hearings -- rules of evidence -- conduct -- filing limits -- exception. (1) The statutory and common-law rules of evidence do not apply to a hearing before the department under this chapter. A petition for a hearing before the department must be filed within 2 years after the dispute arises or after benefits are denied, whichever occurs first.
(2) Except for a hearing before the workers' compensation court, a hearing under this chapter may be conducted by telephone or by videoconference."
Section 8. Section 39-71-406, MCA, is amended to read:
"39-71-406. Deduction from wages of any part of premium a misdemeanor. It is unlawful for the employer to deduct or obtain any part of any premium required to be paid by this chapter from the wages or earnings of the employer's workers, and the making or attempt to make any such premium deduction is a misdemeanor. The workers' compensation old fund liability tax under 39-71-2503 is not a premium for the purpose of this section."
SECTION 9. SECTION 39-71-502, MCA, IS AMENDED TO READ:
"39-71-502. Creation and purpose of uninsured employers' fund. (1) There is created an uninsured employers' fund. The purpose of the fund is to pay:
(b) the costs of investigating and prosecuting workers' compensation fraud under 2-15-2015.
(2) The department may refer to the workers' compensation fraud office established in 2-15-2015 cases involving:
(a) false or fraudulent claims for benefits; or
(b) criminal violations of 45-7-501."
SECTION 10. SECTION 39-71-605, MCA, IS AMENDED TO READ:
"39-71-605. Examination of employee by physician -- effect of refusal to submit to examination -- report and testimony of physician -- cost. (1) (a) Whenever in case of injury the right to compensation under this chapter would exist in favor of any employee, the employee shall, upon the written request of the insurer, submit from time to time to examination by a physician, psychologist, or panel of physicians, who that must be provided and paid for by the insurer, and shall likewise submit to examination from time to time by any physician, psychologist, or panel of physicians selected by the department or as ordered by the workers' compensation judge.
(b) The request or order for an examination must fix a time and place for the examination, with regard for the employee's convenience, physical condition, and ability to attend at the time and place that is as close to the employee's residence as is practical. An examination that is conducted by a physician, psychologist, or panel licensed in another state is not precluded under this section. The employee is entitled to have a physician present at any examination. If the employee, after written request, fails or refuses to submit to the examination or in any way obstructs the examination, the employee's right to compensation must be suspended and is subject to the provisions of 39-71-607. Any physician, psychologist, or panel of physicians employed by the insurer or the department who makes or is present at any examination may be required to testify as to the results of the examination.
(2) In the event of a dispute concerning the physical condition of a claimant or the cause or causes of the injury or disability, if any, the department or the workers' compensation judge, at the request of the claimant or insurer, as the case may be, shall require the claimant to submit to an examination as it considers desirable by a physician, psychologist, or panel of physicians within the state or elsewhere who have that has had adequate and substantial experience in the particular field of medicine concerned with the matters presented by the dispute. The physician, psychologist, or panel of physicians making the examination shall file a written report of findings with the claimant and insurer for their use in the determination of the controversy involved. The requesting party shall pay the physician, psychologist, or panel of physicians for the examination.
(3) As used in this section, a panel of physicians includes a treating physician, as defined in 39-71-116, and may include a psychologist.
(4) A claimant is required, upon a written request of an insurer, to submit to a functional capacities evaluation conducted by a licensed physical therapist.
(3)(5) This section does not apply to impairment evaluations provided for in 39-71-711."
Section 11. Section 39-71-606, MCA, is amended to read:
"39-71-606. Insurer to accept or deny claim within thirty days of receipt -- notice of benefits and entitlements to claimants -- notice of denial -- notice of reopening -- notice to employer. (1) Every Each insurer under any plan for the payment of workers' compensation benefits shall, within 30 days of receipt of a claim for compensation SIGNED BY THE CLAIMANT OR THE CLAIMANT'S REPRESENTATIVE, either accept or deny the claim, and, if denied, shall inform the claimant and the department in writing of such the denial.
(4) Upon the request of an employer that it insures, an insurer shall notify the employer of all compensation benefits that are ongoing and are being charged against that employer's account.
(5) Failure of an insurer to comply with the time limitations required in this section does not constitute an acceptance of a claim as a matter of law. However, an insurer who fails to comply with 39-71-608 or this section may be assessed a penalty under 39-71-2907 if a claim is determined to be compensable by the workers' compensation court."
Section 12. Section 39-71-703, MCA, is amended to read:
"39-71-703. Compensation for permanent partial disability. (1) If an injured worker suffers a permanent partial disability and is no longer entitled to temporary total or permanent total disability benefits, the worker is entitled to a permanent partial disability award if that worker:
(c) if a worker has no actual wage loss as a result of the industrial injury, 0%; if a worker has an actual wage loss of $2 or less an hour as a result of the industrial injury, 10%; if a worker has an actual wage loss of more than $2 $2.01 to $4 MORE THAN $2 an hour as a result of the industrial injury, 20%; if a worker has an actual wage loss of $4.01 to $6 an hour as a result of the industrial injury, 30%; if a worker has an actual wage loss of more than $6 an hour as a result of the industrial injury, 40%. Wage loss benefits must be based on the difference between the actual wages received at the time of injury and the wages that the worker earns or is qualified to earn after the worker reaches maximum healing.
(c) "light labor activity" means the ability to lift up to 25 20 pounds occasionally or up to 10 pounds frequently; and
(d) "sedentary labor activity" means the ability to lift up to 10 pounds occasionally or up to 5 pounds frequently."
Section 13. Section 39-71-712, MCA, is amended to read:
"39-71-712. Temporary partial disability benefits. (1) If, prior to maximum healing, an injured worker has a physical restriction and is approved to return to a modified or alternative employment that the worker is able and qualified to perform and the worker suffers an actual wage loss as a result of a temporary work restriction, the worker qualifies for temporary partial disability benefits.
(4) A worker is not eligible for temporary partial disability benefits or temporary total disability benefits if:
(a) the worker has been released by the treating physician to return to a modified or alternative position that the individual is able and qualified to perform with the same employer;
(b) the wages payable in the modified or alternative position, when combined with the temporary partial disability benefits, would result in an equivalent or higher wage than the worker received at the time of injury; and
(c) the worker refuses to accept the modified or alternative position. A worker requalifies for temporary total disability benefits if the modified or alternative position is no longer available to the worker and the worker continues to be temporarily totally disabled as defined in 39-71-116.
(5) Temporary partial disability may not be credited against any permanent partial disability award or settlement under 39-71-703."
Section 13. Section 39-71-1006, MCA, is amended to read:
"39-71-1006. Rehabilitation benefits. (1) A disabled worker, as defined in 39-71-1011, is eligible for rehabilitation benefits if:
(a) the worker has an actual wage loss or a whole person impairment rating of 15% or greater as a result of the injury;
(b) a rehabilitation provider, as designated by the insurer, certifies that the injured worker has reasonable vocational goals and reasonable reemployment opportunity and. If eligible because of an impairment rating of 15% or more, with rehabilitation the worker will have a reasonable increase in the worker's wage compared to the wage that the worker received at the time of injury. If eligible because of a wage loss, the worker will have a reasonable reduction in the worker's actual wage loss with rehabilitation; and.
(6) A worker may not receive both wages and rehabilitation benefits without the written consent of the insurer. A worker who receives both wages and rehabilitation benefits without written consent of the insurer is guilty of theft and may be prosecuted under 45-6-301."
Section 14. Section 39-71-2316, MCA, is amended to read:
"39-71-2316. Powers of state fund -- assumption of pre-July 1, 1990, claims -- PAYMENT TO ACCOUNT FOR CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS OCCURRING BEFORE JULY 1, 1990. (1) For the purposes of carrying out its functions, the state fund may:
(1)(a) insure any employer for workers' compensation and occupational disease liability as the coverage is required by the laws of this state and, as part of the coverage, provide related employers' liability insurance upon approval of the board;
(2)(b) sue and be sued;
(3)(c) except as provided in section 21, Chapter 4, Special Laws of May 1990, enter into contracts relating to the administration of the state fund, including claims management, servicing, and payment;
(4)(d) collect and disburse money received;
(5)(e) adopt classifications and charge premiums for the classifications so that the state fund will be neither more nor less than self-supporting. Premium rates for classifications may only be adopted and changed using a process, a procedure, formulas, and factors set forth in rules adopted under Title 2, chapter 4, parts 2 through 4. After the rules have been adopted, the state fund need not follow the rulemaking provisions of Title 2, chapter 4, when changing classifications and premium rates. The contested case rights and provisions of Title 2, chapter 4, do not apply to an employer's classification or premium rate. The state fund is required to belong to a licensed workers' compensation advisory organization or a licensed workers' compensation rating organization under Title 33, chapter 16, part 4, and may use the classifications of employment adopted by the designated workers' compensation advisory organization, as provided in Title 33, chapter 16, part 10, and corresponding rates as a basis for setting its own rates. Except as provided in Title 33, chapter 16, part 10, a workers' compensation advisory organization or a licensed workers' compensation rating organization under Title 33, chapter 16, part 4, or other person may not, without first obtaining the written permission of the employer, use, sell, or distribute an employer's specific payroll or loss information, including but not limited to experience modification factors.
(6)(f) pay the amounts determined due under a policy of insurance issued by the state fund;
(7)(g) hire personnel;
(8) declare dividends if there is an excess of assets over liabilities. However, dividends may not be paid until adequate actuarially determined reserves are set aside. If those reserves have been set aside, money that can be declared as a dividend must be transferred to the account created by 39-71-2321 for claims for injuries resulting from accidents that occurred before July 1, 1990, and used for the purposes of that account. After all claims funded by that account have been paid, dividends may be declared and paid to insureds.
(h) upon approval of the board, contract with licensed resident insurance producers;
(i) upon approval of the board, enter into agreements with licensed workers' compensation insurers, INSURANCE ASSOCIATIONS, OR INSURANCE PRODUCERS to provide workers' compensation coverage in other states to Montana-domiciled employers insured with the state fund;
(9)(j) perform all functions and exercise all powers of a private insurance carrier that are necessary, appropriate, or convenient for the administration of the state fund.
(2) On [the effective date of this section], the state fund shall assume full liability for the administration and payment of claims for injuries resulting from accidents that occurred before July 1, 1990 THE STATE FUND SHALL, NO LATER THAN JUNE 30, 1998, TRANSFER $63.8 MILLION TO THE ACCOUNT CREATED IN 39-71-2321 TO PAY CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990."
Section 15. Section 39-71-2316, MCA, is amended to read:
"39-71-2316. Powers of state fund. (1) For the purposes of carrying out its functions, the state fund may:
(1)(a) (1) insure any employer for workers' compensation and occupational disease liability as the coverage is required by the laws of this state and, as part of the coverage, provide related employers' liability insurance upon approval of the board;
(2)(b)(2) sue and be sued;
(3)(c)(3) except as provided in section 21, Chapter 4, Special Laws of May 1990, enter into contracts relating to the administration of the state fund, including claims management, servicing, and payment;
(4)(d)(4) collect and disburse money received;
(5)(e)(5) adopt classifications and charge premiums for the classifications so that the state fund will be neither more nor less than self-supporting. Premium rates for classifications may only be adopted and changed using a process, a procedure, formulas, and factors set forth in rules adopted under Title 2, chapter 4, parts 2 through 4. After the rules have been adopted, the state fund need not follow the rulemaking provisions of Title 2, chapter 4, when changing classifications and premium rates. The contested case rights and provisions of Title 2, chapter 4, do not apply to an employer's classification or premium rate. The state fund is required to belong to a licensed workers' compensation advisory organization or a licensed workers' compensation rating organization under Title 33, chapter 16, part 4, and may use the classifications of employment adopted by the designated workers' compensation advisory organization, as provided in Title 33, chapter 16, part 10, and corresponding rates as a basis for setting its own rates. Except as provided in Title 33, chapter 16, part 10, a workers' compensation advisory organization or a licensed workers' compensation rating organization under Title 33, chapter 16, part 4, or other person may not, without first obtaining the written permission of the employer, use, sell, or distribute an employer's specific payroll or loss information, including but not limited to experience modification factors.
(6)(f)(6) pay the amounts determined due under a policy of insurance issued by the state fund;
(7)(g)(7) hire personnel;
(8)(h)(8) declare dividends if there is an excess of assets over liabilities. However, dividends may not be paid until adequate actuarially determined reserves are set aside. If those reserves have been set aside, money that can be declared as a dividend must be transferred to the account created by 39-71-2321 for claims for injuries resulting from accidents that occurred before July 1, 1990, and used for the purposes of that account. After all claims funded by that account have been paid, dividends may be declared and paid to insureds.
(i)(9) upon approval of the board, contract with licensed resident insurance producers;
(j)(10) upon approval of the board, enter into agreements with licensed workers' compensation insurers, INSURANCE ASSOCIATIONS, OR INSURANCE PRODUCERS to provide workers' compensation coverage in other states to Montana-domiciled employers insured with the state fund;
(9)(k)(11) perform all functions and exercise all powers of a private insurance carrier that are necessary, appropriate, or convenient for the administration of the state fund.
(2) On [the effective date of this section], the state fund shall assume full liability for the administration and payment of claims for injuries resulting from accidents that occurred before July 1, 1990."
Section 16. Section 39-71-2320, MCA, is amended to read:
"39-71-2320. (Temporary) Property of state fund -- investment required -- exception. All (1) Except as provided in subsection (2), all premiums and other money paid to the state fund, all property and securities acquired through the use of money belonging to the state fund, and all interest and dividends earned upon money belonging to the state fund are the sole property of the state fund and must be used exclusively for the operations and obligations of the state fund. The money collected by the state fund may not be used for any other purpose. However, state fund money must be invested by the board of investments provided for in 2-15-1808.
(2) The state fund shall pay to the general fund:
(a) $10 million in the fiscal year ending June 30, 1998; and
(b) $10 million in the fiscal year ending June 30, 1999.
Section 17. Section 39-71-2321, MCA, is amended to read:
"39-71-2321. What to be deposited in state fund. (1) (a) All premiums, penalties, recoveries by subrogation, interest earned upon money belonging to the state fund, and securities acquired by or through use of money, and taxes collected under 39-71-2503 and 39-71-2505, AND THE INTEREST AND PENALTIES ON THE TAXES IN ACCORDANCE WITH 15-1-501 must be deposited in the state fund. They must be separated into two accounts based upon whether they relate. THEY MUST BE SEPARATED INTO TWO ACCOUNTS BASED UPON WHETHER THEY RELATE to pay claims for injuries resulting from accidents that occurred before July 1, 1990, or claims for injuries resulting from accidents that occur on or after that date.
(b)(2) All funds deposited in the state fund are statutorily appropriated as provided in 17-7-502.
(2) The proceeds of bonds issued and loans given to the state fund under 39-71-2354 and 39-71-2355 must be deposited in the account for claims for injuries resulting from accidents that occurred before July 1, 1990.
(3) THE PROCEEDS OF BONDS ISSUED AND LOANS GIVEN TO THE STATE FUND UNDER 39-71-2354 AND 39-71-2355 MUST BE DEPOSITED IN THE ACCOUNT FOR CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990."
Section 18. Section 39-71-2321, MCA, is amended to read:
"39-71-2321. What to be deposited in state fund. (1) (a) All premiums, penalties, recoveries by subrogation, interest earned upon money belonging to the state fund, and securities acquired by or through use of money, TAXES COLLECTED UNDER 39-71-2503 AND 39-71-2505, AND THE INTEREST AND PENALTIES ON THE TAXES IN ACCORDANCE WITH 15-1-501 must be deposited in the state fund. They must be separated into two accounts based upon whether they relate. THEY MUST BE SEPARATED INTO TWO ACCOUNTS BASED UPON WHETHER THEY RELATE to pay claims for injuries resulting from accidents that occurred before July 1, 1990, or claims for injuries resulting from accidents that occur on or after that date.
Section 19. Section 39-71-2322, MCA, is amended to read:
"39-71-2322. Money in state fund held in trust -- disposition of funds upon repeal of chapter -- exception. The Except as provided in 39-71-2320, the money coming into the state fund must be held in trust for the purpose for which the money was collected. If this chapter is repealed, the money is subject to the disposition provided by the legislature repealing this chapter. In the absence of a legislative provision, distribution must be in accordance with the justice of the matter, due regard being had given to obligations of compensation incurred and existing."
Section 20. Section 39-71-2323, MCA, is amended to read:
"39-71-2323. Surplus in state fund -- payment of dividends. Subject to the provisions of 39-71-2316, if at the end of any fiscal year there exists in the state fund account created by 39-71-2321 for claims for injuries resulting from accidents that occur on or after July 1, 1990, an excess of assets over liabilities, including necessary reserves and a reasonable surplus, and if the excess may be refunded safely, then the state fund may declare a dividend. The rules of the state fund must prescribe the manner of payment to those employers who have paid premiums into the state fund in excess of liabilities chargeable to them in the fund for that year. In determining the amount or proportion of the balance to which the employer is entitled as dividends, the state fund shall give consideration to the prior paid premiums and accident experience of each individual employer during the dividend year."
Section 20. Section 39-71-2327, MCA, is amended to read:
"39-71-2327. Earnings of state fund to be credited to fund -- improper use a felony -- exception. All Except as provided in 39-71-2320, all earnings made by the state fund by reason of interest paid for the deposit thereof of funds or otherwise must be credited to and become a part of the fund, and the making of profit, either directly or indirectly, by any person out of the use of the fund is a felony. A person convicted of an offense under this section is punishable by imprisonment in the state prison for a term not to exceed 2 years or a fine of not more than $5,000, or both."
Section 22. Section 39-71-2361, MCA, is amended to read:
"39-71-2361. Legislative audit of state fund. The legislative auditor shall annually conduct or have conducted a financial and compliance audit of the state fund, including its operations relating to claims for injuries resulting from accidents that occurred before July 1, 1990. The audit must include evaluations of the claims reservation process, the amounts reserved, and the current report of the state fund's actuary. The evaluations may be conducted by persons appointed under 5-13-305. Audit and evaluation costs are an expense of and must be paid by the state fund and must be allocated between those claims for injuries resulting from accidents that occurred before July 1, 1990, and those claims for injuries resulting from accidents that occur on or after that date."
SECTION 21. SECTION 39-71-2351, MCA, IS AMENDED TO READ:
SECTION 22. SECTION 39-71-2352, MCA, IS AMENDED TO READ:
"39-71-2352. Separate payment structure and sources for claims for injuries resulting from accidents that occurred before July 1, 1990, and on or after July 1, 1990 -- spending limit. (1) Premiums paid to the state fund based upon wages payable before July 1, 1990, may be used only to administer and pay claims for injuries resulting from accidents that occurred before July 1, 1990. Except as provided in 39-71-2316 and 39-71-2354, premiums paid to the state fund based upon wages payable on or after July 1, 1990, may be used only to administer and pay claims for injuries resulting from accidents that occur on or after July 1, 1990.
SECTION 23. SECTION 39-71-2352, MCA, IS AMENDED TO READ:
"39-71-2352. Separate payment structure and sources for claims for injuries resulting from accidents that occurred before July 1, 1990, and on or after July 1, 1990 -- spending limit. (1) Premiums paid to the state fund based upon wages payable before July 1, 1990, may be used only to administer and pay claims for injuries resulting from accidents that occurred before July 1, 1990. Except as provided in 39-71-2316 and 39-71-2354, premiums Premiums paid to the state fund based upon wages payable on or after July 1, 1990, may be used only to administer and pay claims for injuries resulting from accidents that occur on or after July 1, 1990.
Section 24. Section 39-71-2363, MCA, is amended to read:
"39-71-2363. Agency law -- submission of budget -- annual report. (1) The state fund is subject to state laws applying to state agencies, except as otherwise provided by law, and it is exempt from the provisions of The Legislative Finance Act in Title 5, chapter 12, and the provisions of Title 17, chapter 7, parts 1 through 4. The state fund may use the debt collection procedures provided in Title 17, chapter 4, part 1.
(2) The (a) Except as provided in 2-15-2015, the executive director shall annually submit to the board for its approval an estimated budget of the entire expense of administering the state fund for the succeeding fiscal year, with due regard to the business interests and contract obligations of the state fund. The administrative expenditures approved by the board may not exceed 15% of the earned annual premium and investment income of the prior fiscal year. A copy of the approved budget must be delivered to the governor and the legislature.
(b) The administrative expenditures used to determine the 15% limit in subsection (1) do not include:
(i) allocated or unallocated loss adjustment expenses determined in accordance with the guidelines promulgated by the national association of insurance commissioners;
(ii) capital asset expenditures required in full accrual accounting, except for capital assets depreciation expenses;
(iii) payments pursuant to contracts with licensed resident insurance producers; and
(iv) dividend payments THE BOARD MAY APPROVE ADMINISTRATIVE EXPENDITURES IN EXCESS OF 15% OF THE EARNED ANNUAL PREMIUM OF THE PRIOR FISCAL YEAR, BUT THE EXCESS AMOUNT APPROVED MAY NOT EXCEED ONE-HALF OF THE INVESTMENT INCOME EARNED IN THE PRIOR FISCAL YEAR.
(C) UPON APPROVAL OF THE ESTIMATED BUDGET FOR THE SUCCEEDING FISCAL YEAR, THE STATE FUND SHALL, NO LATER THAN OCTOBER 1 OF EACH YEAR, SUBMIT THE APPROVED ANNUAL BUDGET FOR REVIEW TO THE LEGISLATIVE FINANCE COMMITTEE ESTABLISHED UNDER
5-12-201.
(D) DIVIDENDS MAY NOT BE INCLUDED AS ADMINISTRATIVE EXPENDITURES AS PROVIDED IN SUBSECTION (2)(A), BUT ARE A DISBURSEMENT OF EXCESS SURPLUS PURSUANT TO 39-71-2323 AFTER A DETERMINATION BY THE STATE FUND OF INCOME FROM OPERATIONS.
(3) The board shall submit an annual financial report to the governor and to the legislature as provided in 5-11-210, indicating the business done by the state fund during the previous year and containing a statement of the estimated liabilities of the state fund as determined by an independent actuary."
Section 25. Section 39-71-2501, MCA, is amended to read:
(2)(1) "Department" means the department of revenue provided for in 2-15-1301.
(3)(2) "Employee" includes an officer, employee, or elected public official of the United States, the state of Montana, or any political subdivision of the United States or the state of Montana or any agency or instrumentality of the United States, the state of Montana, or a political subdivision of the United States or the state of Montana. The term "employee" also includes an officer of a corporation.
(4)(3) (a) "Employer" means, except as provided in subsection (4)(b) (3)(b), the person for whom an individual performs or performed any service, of whatever nature, as an employee of the person.
(5)(4) "Federal workers' compensation legislation" means federal legislation that provides an employee with compensation or remuneration for accidental injury or death. This legislation includes but is not limited to the Federal Employers' Liability Act, the Federal Employees' Compensation Act, and the Defense Base Act.
(6)(5) "Ongoing activities" means obligations or occurrences that are continuous, rather than intermittent or occasional, that exist for a definite period of time during the year, or that are intended to cover or apply to successive and similar obligations or occurrences.
(7)(6) "Publicly traded limited partnership" means a business entity that issues shares or similar ownership interests that are sold or purchased by persons through certified stockbrokers or licensed traders on a public exchange recognized by the securities exchange commission.
(8)(7) "State fund" means the state compensation insurance fund.
(9)(8) "Tax" or "old fund liability tax" means the workers' compensation old fund liability tax provided for in 39-71-2503, created to address the unfunded liability for claims for injuries resulting from accidents that occurred before July 1, 1990.
(10)(9) "Wages" means all remuneration for services performed in the state of Montana by an employee for an employer, including the cash value of all remuneration paid in any medium other than cash. The term does not include remuneration paid:
(a) for casual labor not in the course of the employer's trade or business performed in any calendar quarter by an employee unless the cash remuneration paid for the service is $50 or more and the service is performed by an individual who is regularly employed by the employer to perform the service. For purposes of this subsection (10)(a) (9)(a), an individual is considered to be regularly employed by an employer during a calendar quarter only if:
(ii) the individual was regularly employed, as determined under subsection (10)(a)(i) (9)(a)(i), by the employer in the performance of service during the preceding calendar quarter.
Section 26. Section 39-71-2503, MCA, is amended to read:
(F) THIS OLD FUND LIABILITY TAX MUST BE USED TO REDUCE THE UNFUNDED LIABILITY IN THE STATE FUND INCURRED FOR CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990.
(g)(f)(G) Each employer shall maintain the records that the department requires concerning the old fund liability tax. The records are subject to inspection by the department and its employees and agents during regular business hours.
(h)(g)(H) An employee does not have any right of action against an employer for any money deducted and withheld from the employee's wages and paid to the state in compliance or intended compliance with this section.
(i)(h)(I) The employer is liable to the state for any amount of old fund liability taxes, plus interest and penalty, when the employer fails to withhold from an employee's wages or fails to remit to the state the old fund liability tax required by this section.
(j)(i)(J) A sole proprietor, subchapter S. corporation shareholder, partner of a partnership, or member or manager of a limited liability company is liable to the state for the old fund liability tax, plus interest and penalty, when the sole proprietor, shareholder, partner, or member or manager fails to remit to the state the old fund liability tax required by this section.
(2) All collections of the tax must be deposited as received in the account provided for in 39-71-2321. The tax is in addition to any other tax or fee assessed against persons subject to the tax.
(3) (a) Tax payments and returns required by subsections (1)(a) and (1)(b) must be made pursuant to 15-30-204. The department shall first credit a payment to the liability under 15-30-202 and credit any remainder to the account provided for in 39-71-2504 39-71-2321.
(b) Tax payments due from sole proprietors, subchapter S. corporation shareholders, partners of partnerships, and members or managers of limited liability companies must be made with and at the same time as the returns filed pursuant to 15-30-144 and 15-30-241. The department shall first credit a payment to the liability under 15-30-103 or 15-30-202 and shall then credit any remainder to the account state fund ACCOUNT as provided for in 39-71-2504 39-71-2321.
Section 27. Section 39-71-2505, MCA, is amended to read:
"39-71-2505. Payment of unfunded for OF UNFUNDED liability for injuries resulting from accidents occurring before or after July 1, 1990. (1) The state fund shall pay for the cost of administering and paying claims for injuries resulting from accidents that occurred before July 1, 1990, not covered by any other funding source, by borrowing from the reserves accumulated from premiums paid to the state fund, based upon wages payable on or after July 1, 1990, and invested by the board of investments, from time to time, the amount that the state fund determines and that the budget director certifies, as provided in 39-71-2354, will be needed to pay for administering and paying the claims for the ensuing year.
(2) (a) In January of each year, prior to the start of the following fiscal year, the state fund shall forward to the budget director information pertaining to the amount that the state fund will borrow for the ensuing fiscal year to pay for the cost of administering and paying claims for the injuries provided for in subsection (1). In addition, the state fund shall forward to the budget director the schedule of projected liability payments and cash needs on which the amount to be borrowed is based. The schedule must include but is not limited to total projected liability payments, loans and bond debt payments, revenue from the old fund liability tax provided for in 39-71-2503, projected fiscal yearend cash, and the projected fiscal yearend cash for the year 2007. (1) THE STATE FUND SHALL PAY FOR THE COST OF ADMINISTERING AND PAYING CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990, NOT COVERED BY ANY OTHER FUNDING SOURCE, BY BORROWING FROM THE RESERVES ACCUMULATED FROM PREMIUMS PAID TO THE STATE FUND, BASED UPON WAGES PAYABLE ON OR AFTER JULY 1, 1990, AND INVESTED BY THE BOARD OF INVESTMENTS, FROM TIME TO TIME, THE AMOUNT THAT THE STATE FUND DETERMINES AND THAT THE BUDGET DIRECTOR CERTIFIES, AS PROVIDED IN 39-71-2354, WILL BE NEEDED TO PAY FOR ADMINISTERING AND PAYING THE CLAIMS FOR THE ENSUING YEAR.
(2) IN JANUARY OF EACH YEAR, PRIOR TO THE START OF THE FOLLOWING FISCAL YEAR, THE STATE FUND SHALL FORWARD TO THE BUDGET DIRECTOR INFORMATION PERTAINING TO THE AMOUNT THAT THE STATE FUND WILL BORROW FOR THE ENSUING FISCAL YEAR TO PAY FOR THE COST OF ADMINISTERING AND PAYING CLAIMS FOR THE INJURIES PROVIDED FOR IN SUBSECTION (1). IN ADDITION, THE STATE FUND SHALL FORWARD TO THE BUDGET DIRECTOR THE SCHEDULE OF PROJECTED LIABILITY PAYMENTS AND CASH NEEDS ON WHICH THE AMOUNT TO BE BORROWED IS BASED. THE SCHEDULE MUST INCLUDE BUT IS NOT LIMITED TO TOTAL PROJECTED LIABILITY PAYMENTS, LOANS AND BOND DEBT PAYMENTS, REVENUE FROM THE OLD FUND LIABILITY TAX PROVIDED FOR IN 39-71-2503, PROJECTED FISCAL YEAREND CASH, AND THE PROJECTED FISCAL YEAREND CASH FOR THE YEAR 2007.
(b) (i)(1)(3) There is imposed on each employer a workers' compensation old fund liability tax as provided in 39-71-2503. The employer old fund liability tax is an amount equal to 0.5% of the employer's payroll in the preceding calendar quarter.
(ii)(2)(4) The employee old fund liability tax is an amount equal to 0.2% of the employee's wages in the preceding calendar quarter.
(iii)(3)(5) The Except as provided in subsection (5)(b) (7)(E), the old fund liability tax is an amount equal to 0.2% on the profit of each separate business of a sole proprietor and on the distributive share of ordinary income of each subchapter S. corporation shareholder, partner of a partnership, or member or manager of a limited liability company.
(iv)(4)(6) The rate of the employer old fund liability tax determined by this section includes the 0.28% employer old fund liability tax provided for in 39-71-2503.
(v) (A) The employer (5) (a) Except as provided in subsections (5)(b) and (5)(c), the old fund liability tax that is in excess of the 0.28% tax provided for in 39-71-2503 terminates at the end of fiscal year 2007 on January 1, 1999, if, by October 15, 1998, the budget director certifies to the department that, based upon projections approved by the state fund board of directors, the claim reserve liability to surplus ratio of the state fund on June 30, 1999, will be less than 7.5 to 1.
(b) If, prior to October 15, 1998, the budget director receives projections approved by the state fund board of directors that the claim reserve liability to surplus ratio on June 30, 1999, is greater than 7.5 to 1, the budget director shall certify the need to continue the tax through June 30, 1999, and shall notify the department no later than October 15, 1998, to collect the tax pursuant to this section. If the tax is terminated pursuant to this subsection, the amount of tax imposed under subsection (3) is an amount equal to 0.1%.
(c) If, prior to January 15, 1999, the budget director receives projections from the state fund board of directors that the claim reserve liability to surplus ratio of the state fund on June 30, 2000, is greater than 7.5 to 1, the budget director shall certify the need to continue the tax through December 31, 1999, and shall notify the department no later than January 15, 1999, to collect the tax pursuant to this section.
(d) In determining the projected claim liability reserve to surplus ratio under this subsection (5), the state fund shall include the estimated future amounts of the old fund liability tax through the estimated termination date.
(e) Regardless of any projected claim reserve liability to surplus ratio required under this subsection (5), the old fund liability tax terminates no later than January 1, 2000.
(7) (A) THE OLD FUND LIABILITY TAX IMPOSED UNDER 39-71-2503 AND 39-71-2505 TERMINATES ON EITHER JANUARY 1 OR JULY 1 OF THE YEAR IN WHICH CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990, ARE PROJECTED TO BE ADEQUATELY FUNDED.
(B) AS USED IN THIS PART, "ADEQUATELY FUNDED" MEANS THE PRESENT VALUE OF:
(I) THE TOTAL COST OF FUTURE BENEFITS REMAINING TO BE PAID;
(II) THE COST OF ADMINISTERING THE CLAIMS; AND
(III) AN ADDITIONAL AMOUNT EQUAL TO 10% OF THE TOTAL OF THE AMOUNTS IN SUBSECTIONS (7)(B)(I) AND (7)(B)(II).
(C) EACH FISCAL YEAR UNTIL THE OLD FUND LIABILITY TAX TERMINATES, THE INDEPENDENT ACTUARY ENGAGED BY THE STATE FUND PURSUANT TO 39-71-2330 SHALL PROJECT THE UNPAID CLAIMS LIABILITY, AS OF THE FOLLOWING JUNE 30, FOR CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990.
(D) THE OLD FUND LIABILITY TAX TERMINATES ON JANUARY 1 IF, BY OCTOBER 15 OF THE PRIOR YEAR, THE BUDGET DIRECTOR CERTIFIES TO THE DEPARTMENT THAT, BASED UPON THE INDEPENDENT ACTUARY'S SELECTED BEST ESTIMATE ULTIMATE PROJECTIONS AND AS APPROVED BY THE STATE FUND BOARD OF DIRECTORS, CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990, WILL BE ADEQUATELY FUNDED AS OF JANUARY 1.
(E) THE OLD FUND LIABILITY TAX TERMINATES ON JULY 1 IF, BY FEBRUARY 28 OF THE YEAR THE BUDGET DIRECTOR CERTIFIES TO THE DEPARTMENT THAT, BASED UPON THE INDEPENDENT ACTUARY'S SELECTED BEST ESTIMATE ULTIMATE PROJECTIONS AND, AS APPROVED BY THE STATE FUND BOARD OF DIRECTORS, CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990, WILL BE ADEQUATELY FUNDED AS OF JULY 1.
(F) IF THE OLD FUND LIABILITY TAX TERMINATES ON JULY 1, THE AMOUNT OF TAX IMPOSED UNDER SUBSECTION (5) IS AN AMOUNT EQUAL TO 0.1% FOR THE FULL CALENDAR YEAR.
(G) IN DETERMINING WHETHER CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990, ARE ADEQUATELY FUNDED, THE ESTIMATED FUTURE AMOUNTS OF OLD FUND LIABILITY TAX MUST BE INCLUDED.
(H) BY OCTOBER 1 OF EACH YEAR FOLLOWING THE FIRST FULL FISCAL YEAR AFTER TERMINATION OF THE OLD FUND LIABILITY TAX, ANY FUNDS IN EXCESS OF THE ADEQUATE FUNDING AMOUNT ESTABLISHED IN SUBSECTION (7)(B) MUST BE RETURNED TO THE ACCOUNT ESTABLISHED IN 39-71-2321 TO PAY CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED AFTER JULY 1, 1990. UNDER THIS SECTION, THE TOTAL AMOUNT OF FUNDS RETURNED TO THE ACCOUNT MAY NOT EXCEED $63.8 MILLION.
(I) IF, IN ANY FISCAL YEAR AFTER THE OLD FUND LIABILITY TAX IS TERMINATED AND CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED AFTER JULY 1, 1990, ARE NOT ADEQUATELY FUNDED, ANY AMOUNT RETURNED TO THE ACCOUNT IN 39-71-2321 TO PAY CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED AFTER JULY 1, 1990, PURSUANT TO SUBSECTION (7)(H) MUST BE TRANSFERRED BACK TO THE ACCOUNT ESTABLISHED IN 39-71-2321 TO PAY CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990.
(J) THE INDEPENDENT ACTUARY ENGAGED BY THE STATE FUND PURSUANT TO 39-71-2330 SHALL PROJECT THE UNPAID CLAIMS LIABILITY FOR CLAIMS FOR INJURIES RESULTING FROM ACCIDENTS THAT OCCURRED BEFORE JULY 1, 1990, EACH FISCAL YEAR UNTIL ALL CLAIMS ARE PAID.
(vi)(6)(8) The old fund liability tax described in this section must be collected and deposited as provided in 39-71-2321 and 39-71-2503 and 39-71-2504.
Section 28. Section 39-71-2905, MCA, is amended to read:
"39-71-2905. Petition to workers' compensation judge -- time limit on filing. (1) A claimant or an insurer who has a dispute concerning any benefits under chapter 71 of this title may petition the workers' compensation judge for a determination of the dispute after satisfying dispute resolution requirements otherwise provided in this chapter. In addition, the district court that has jurisdiction over a pending action under 39-71-515 may request the workers' compensation judge to determine the amount of recoverable damages due to the employee. The judge, after a hearing, shall make a determination of the dispute in accordance with the law as set forth in chapter 71 of this title. If the dispute relates to benefits due to a claimant under chapter 71, the judge shall fix and determine any benefits to be paid and specify the manner of payment. After parties have satisfied dispute resolution requirements provided elsewhere in this chapter, the workers' compensation judge has exclusive jurisdiction to make determinations concerning disputes under chapter 71, except as provided in 39-71-317 and 39-71-516. The penalties and assessments allowed against an insurer under chapter 71 are the exclusive penalties and assessments that can be assessed by the workers' compensation judge against an insurer for disputes arising under chapter 71.
(2) A petition for hearing before the workers' compensation judge must be filed within 2 years after the dispute arises or after benefits are denied, whichever occurs first."
NEW SECTION. Section 29. Transfer of funds. The balance remaining in the workers' compensation bond repayment account on June 30, 1997, must be deposited in the state fund as provided in 39-71-2321.
NEW SECTION. Section 30. Repealer. (1) Sections 39-71-2351, 39-71-2352, 39-71-2354, 39-71-2355, and 39-71-2504, MCA, are SECTION 39-71-2504, MCA, IS repealed.
(2) Sections 39-71-2354, 39-71-2355, 39-71-2501, 39-71-2502, 39-71-2503, 39-71-2505, and 39-71-2506, MCA, are repealed.
NEW SECTION. Section 32. Retroactive applicability. (1) [SECTIONS 6(35)(F) AND 10] APPLY RETROACTIVELY, WITHIN THE MEANING OF 1-2-109, TO CLAIMS FOR INJURIES OCCURRING PRIOR TO [THE EFFECTIVE DATE OF SECTIONS 6(35)(F) AND 10].
(2) [Section 10 11] applies retroactively, within the meaning of 1-2-109, to claims filed on or after March 27, 1973.
NEW SECTION. Section 33. Effective dates -- applicability. (1) [Sections 1, 2, 4 through 6, 14, 16, 17, 19 through 26, 28, and 29(1) 1 THROUGH 5, 6(1) THROUGH 6(34) AND 6(36), 9, 14, 16, 17, 19, 20, 22, 24 THROUGH 27, 29, AND 30(1)] are effective July 1, 1997.
(2) [Sections 7, 8, 11 through 13, and 27 12, 13, AND 28] are effective July 1, 1997, and apply to claims for injuries occurring on or after [the effective dates of sections 7, 8, 11 through 13, and 27 12, 13, AND 28].
(3) [Sections 3, 9, 15, and 18 8, 18, 21, 23, AND 30(2)] are effective on the date that the budget director certifies that the old fund liability tax is terminated pursuant to [section 26 27].
(4) [Section 29(2) 15] is effective January 1, 2000 JULY 1, 1998.
(5) [Sections 10, 30, 31, and 33 6(35), 10, 11, 31, 32, 34, and this section] are effective on passage and approval.
NEW SECTION. Section 34. Contingent termination. TERMINATION. (1) [Sections 14 and 17 17 AND 22] terminate on the date that the old fund liability tax is terminated pursuant to [section 26 27].
(2) [SECTION 14] TERMINATES JUNE 30, 1998.