Workers’ compensation employer notification requirement bill advances with amendments

February 27, 2020

Legislation requiring employers to notify employees who have filed a claim for workers’ compensation within 30 days was reported from the Senate Commerce and Labor Committee unanimously 14-0 with amendments. HB 46 (Carter) stems from a recommendation made by the Joint Legislative Audit and Review Commission (JLARC) as part of its recent report on Virginia’s Workers’ Compensation System and Disease Presumptions.

Current code requires most employers (including local governments) to carry workers’ compensation insurance in order to cover their workers in the event of a work injury. According to the JLARC report, workers in Virginia wait slightly longer to receive compensation benefits in comparison to other states. The median wait time to receive wage replacement benefits in Virginia after date of injury is 27 days. For certain claims such as those involving presumptive illnesses, in which insurers are often required to conduct extensive reviews of claims involving employee life history and health, the wait time can be much longer. Insurers often need to satisfy the terms of reinsurance contracts to prevent catastrophic losses and to determine the validity of claims.

These delays can often be frustrating to employees seeking a claim. According to a survey of firefighters conducted by JLARC staff, responsiveness of the employer’s insurance company was the second most common challenge experienced by firefighters in seeking workers’ compensation benefits. Virginia currently has no requirement by law for insurers to notify a worker of their decision within a certain timeframe. The Virginia Workers’ Compensation (VWC) has an administrative rule that insurers must respond to an injured worker’s request for benefits within 20 days, but according to JLARC has trouble enforcing it.

Representatives of the insurance industry have expressed concern that by requiring employers to respond to an employee claim within a specified timeframe as to whether they intend to accept the claim, deny the claim, or need more information to make such a determination could be problematic, especially for complicated claims such as those involving presumptive illnesses. As such, the bill was amended in the Senate Commerce and Labor Committee to exempt presumptive illnesses from the 30-day notification requirement as well as allowing employers to send notice via email if the employee consents to such communication.

As previously reported, VACo staff have given testimony regarding legislation adding certain diseases to the list of presumptive and occupational diseases covered under the Workers’ Compensation Act and will continue to evaluate and report on related legislation.

VACo Contact: Jeremy R. Bennett

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