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10  AN ACT concerning the workers compensation act; amending K.S.A. 44-
11    505, 44-510b, 44-523, 44-5,120 and 44-5,121 and K.S.A. 1996 Supp.
12    44-508, 44-532, 44-551, 44-555c and 44-5,125 and repealing the ex-
13    isting sections; also repealing K.S.A. 1996 Supp. 44-532b.
14
15  Be it enacted by the Legislature of the State of Kansas:
16    Section 1.  K.S.A. 44-505 is hereby amended to read as follows: 44-
17  505. (a) Subject to the provisions of K.S.A. 44-506 and amendments
18  thereto, the workers compensation act shall apply to all employments
19  wherein employers employ employees within this state except that such
20  act shall not apply to:
21    (1)  Agricultural pursuits and employments incident thereto, other
22  than those employments in which the employer is the state, or any de-
23  partment, agency or authority of the state;
24    (2)  any employment, other than those employments in which the em-
25  ployer is the state, or any department, agency or authority of the state,
26  wherein the employer had a total gross annual payroll for the preceding
27  calendar year of not more than $20,000 for all employees and wherein
28  the employer reasonably estimates that such employer will not have a
29  total gross annual payroll for the current calendar year of more than
30  $20,000 for all employees, except that no wages paid to an employee who
31  is a member of the employer's family by marriage or consanguinity shall
32  be included as part of the total gross annual payroll of such employer for
33  purposes of this subsection, except where the employer is a self-employed
34  subcontractor under circumstances wherein K.S.A. 44-503, and amend-
35  ments thereto, would otherwise apply;
36    (3)  any employment, other than those employments in which the em-
37  ployer is the state, or any department, agency or authority of the state,
38  wherein the employer has not had a payroll for a calendar year and
39  wherein the employer reasonably estimates that such employer will not
40  have a total gross annual payroll for the current calendar year of more
41  than $20,000 for all employees, except that no wages paid to an employee
42  who is a member of the employer's family by marriage or consanguinity
43  shall be included as a part of the total gross annual payroll of such em-
SB 137--Am.
                                     

 1  ployer for purposes of this subsection;
 2    (4)  the employment of any firefighters who are members of a fire-
 3  men's relief association for whom a valid statement of election to except
 4  such members from the provisions of the workers compensation act has
 5  been filed with the director by the governing body of such firemen's relief
 6  association as provided in K.S.A. 44-505d and amendments thereto; or
 7    (5)  services performed by a qualified real estate agent as an inde-
 8  pendent contractor. For the purposes of this act a qualified real estate
 9  agent shall be deemed to be an independent contractor if such qualified
10  real estate agent is licensed by the Kansas real estate commission as a
11  salesperson under the real estate brokers' and salespersons' license act
12  and for whom: (A) Substantially all of the remuneration, whether or not
13  paid in cash, for the services performed by such individual as a real estate
14  salesperson is directly related to sales or other output, including the per-
15  formance of services, rather than to the number of hours worked; and
16  (B) the services performed by the individual are performed pursuant to
17  a written contract between such individual and the person for whom the
18  services are performed and such contract provides that the individual will
19  not be treated as an employee with respect to such services for state tax
20  purposes.
21    (b)  Each employer who employs employees in employments which
22  are excepted from the provisions of the workers compensation act as
23  provided in subsection (a) of this section, shall be entitled to come within
24  the provisions of such act by: (1) Becoming a member in and by main-
25  taining a membership in a qualified group-funded workers' compensation
26  pool, as provided by K.S.A. 44-581 to 44-591, inclusive, and amendments
27  thereto; or (2) filing with the director a written statement of election to
28  accept thereunder. Such written statement of election shall be effective
29  from the date of filing until such time as the employer files a written
30  statement withdrawing such election with the director. All written state-
31  ments of election or of withdrawal of election filed pursuant to this sub-
32  section shall be in such form as may be required by the director by rules
33  and regulations.
34    (c)  This act shall not apply in any case where the accident occurred
35  prior to the effective date of this act. All rights which accrued by reason
36  of any such accident shall be governed by the laws in effect at that time.
37    Sec. 2.  K.S.A. 44-510b is hereby amended to read as follows: 44-
38  510b. Where death results from injury, compensation shall be paid as
39  provided in K.S.A. 44-510 and amendments thereto, and as follows:
40    (a)  If an employee leaves any dependents wholly dependent upon the
41  employee's earnings at the time of the accident, all compensation benefits
42  under this section shall be paid to such dependent persons. Such de-
43  pendents shall be paid weekly compensation, except as otherwise pro-
SB 137--Am.
                                     

 1   vided in this section, in a total sum to all such dependents, equal to 662/3%
 2  of the average gross weekly wage of the employee at the time of the
 3  accident, computed as provided in K.S.A. 44-511 and amendments
 4  thereto, but in no event shall such weekly benefits exceed, nor be less
 5  than, the maximum and minimum weekly benefits provided in K.S.A. 44-
 6  510c and amendments thereto, subject to the following:
 7    (1)  If the employee leaves a surviving legal spouse or a wholly de-
 8  pendent child or children, or both, who are eligible for benefits under
 9  this section, then all death benefits shall be paid to such surviving spouse
10  or children, or both, and no benefits shall be paid to any other wholly or
11  partially dependent persons.
12    (2)  A surviving legal spouse shall be paid compensation benefits for
13  life or until remarriage, except as otherwise provided in this section.
14    (3)  Any wholly dependent child of the employee shall be paid com-
15  pensation, except as otherwise provided in this section, until such de-
16  pendent child becomes 18 years of age, except that any such dependent
17  child who is not physically or mentally capable of earning wages in any
18  type of substantial and gainful employment, or who is enrolled as a full-
19  time student in an accredited institution of higher education or vocational
20  education shall be paid compensation until such dependent child be-
21  comes 23 years of age.
22    (4)  If the employee leaves no legal spouse or dependent children
23  eligible for benefits under this section but leaves other dependents wholly
24  dependent upon the employee's earnings, such other dependents shall
25  receive weekly compensation benefits as provided in this subsection until
26  death, remarriage or so long as such other dependents do not receive
27  more than 50% of their support from any other earnings or income or
28  from any other source, except that the maximum benefits payable to all
29  such other dependents, regardless of the number of such other depend-
30  ents, shall not exceed a maximum amount of $18,500.
31    (b)  Upon the remarriage of a surviving legal spouse receiving com-
32  pensation under this section, the benefits being paid to such spouse shall
33  terminate, except that upon such remarriage 100 weeks of benefits at the
34  highest rate paid to such spouse under this section shall be paid to such
35  spouse in one lump sum, except that such lump-sum payment shall be
36  subject to the maximum amount of compensation payable under this sec-
37  tion as prescribed by subsection (h).
38    (c)  Where the employee leaves a surviving legal spouse and depend-
39  ent children who were wholly dependent upon the employee's earnings
40  and are eligible for benefits under this section 1/2 of the maximum weekly
41  benefits payable shall be apportioned to such spouse and 1/2 to such de-
42  pendent children.
43    (d)  If an employee does not leave any dependents who were wholly
SB 137--Am.
                                     

 1  dependent upon the employee's earnings at the time of the accident but
 2  leaves dependents, other than a spouse or children, in part dependent on
 3  the employee's earnings, such percentage of a sum equal to three times
 4  the employee's average yearly earnings but not exceeding $18,500 but not
 5  less than $2,500, as such employee's average annual contributions which
 6  the employee made to the support of such dependents during the two
 7  years preceding the date of the accident, bears to the employee's average
 8  yearly earnings during the contemporaneous two-year period, shall be
 9  paid in compensation to such dependents, in weekly payments as pro-
10  vided in subsection (a), not to exceed $18,500 to all such dependents.
11    (e)  The administrative law judge, except as otherwise provided in this
12  section, shall have the power and authority to apportion and reapportion
13  the compensation allowed under this section, either to wholly dependent
14  persons or partially dependent persons, in accordance with the degree of
15  dependency as of the date of the accident, except that the weekly payment
16  of compensation to any and all dependents shall not exceed the maximum
17  weekly benefits provided in subsection (a).
18    (f)  In all cases of death compensable under this section, the employer
19  shall pay the reasonable expense of burial not exceeding $3,300 $4,300.
20    (g)  The marriage or death of any dependent shall terminate all com-
21  pensation, under this section, to such dependent, but shall not increase
22  or decrease the compensation allowed to any other dependents except
23  that, upon the marriage or death of the surviving legal spouse or a de-
24  pendent child, the compensation payable to such spouse or child shall be
25  reapportioned to those, among the surviving legal spouse and dependent
26  children, who remain eligible to receive compensation under this section.
27    (h)  Notwithstanding any other provision in this section to the con-
28  trary, the maximum amount of compensation benefits payable under this
29  section to any and all dependents by the employer shall not exceed a total
30  amount of $200,000 and when such total amount has been paid the lia-
31  bility of the employer for any further compensation under this section to
32  dependents, other than minor children of the employee, shall cease ex-
33  cept that the payment of compensation under this section to any minor
34  child of the employee shall continue for the period of the child's minority
35  at the weekly rate in effect when the employer's liability is otherwise
36  terminated under this subsection and shall not be subject to termination
37  under this subsection until such child becomes 18 years of age.
38    (i)  A surviving spouse shall submit an annual statement to the em-
39  ployer and to the director, in such form and containing such information
40  relating to eligibility for compensation under this section as may be re-
41  quired by rules and regulations of the director. If such spouse fails to
42  submit such an annual statement, the employer may notify the director
43  of such failure and the director shall notify such spouse of such failure
SB 137--Am.
                                     

 1  by certified mail with return receipt. If such spouse fails to submit the
 2  annual statement or fails to reasonably provide the required information
 3  within 30 days after receipt of the notice from the director, all compen-
 4  sation benefits paid under this section to such spouse shall be suspended
 5  until such statement is submitted in proper form to the employer and the
 6  director.
 7    Sec. 3.  K.S.A. 44-523 is hereby amended to read as follows: 44-523.
 8    (a) The director, administrative law judge or board shall not be bound by
 9  technical rules of procedure, but shall give the parties reasonable oppor-
10  tunity to be heard and to present evidence, insure the employee and the
11  employer an expeditious hearing and act reasonably without partiality.
12    (b)  Whenever a party files an application for hearing pursuant to
13  K.S.A. 44-534 and amendments thereto, the matter shall be assigned to
14  an administrative law judge for hearing and the administrative law judge
15  shall set a terminal date to require the claimant to submit all evidence in
16  support of the claimant's claim no later than 30 days after the first full
17  hearing before the administrative law judge and to require the respondent
18  to submit all evidence in support of the respondent's position no later
19  than 30 days thereafter. An extension of the foregoing time limits may be
20  granted:
21    (1)  If all parties agree;
22    (2)  if the employee is being paid temporary or permanent total dis-
23  ability compensation;
24    (3)  for medical examination of the claimant if the party requesting
25  the extension explains in writing to the administrative law judge facts
26  showing that the party made a diligent effort but was unable to have a
27  medical examination conducted prior to the submission of the case by the
28  claimant but then only if the examination appointment was set and notice
29  of the appointment sent prior to submission by the claimant; or
30    (4)  on application for good cause shown.
31    (c)  When all parties have submitted the case to an administrative law
32  judge for an award, the administrative law judge shall issue an award
33  within 30 days. The administrative law judge shall not stay a decision due
34  to the absence of a submission letter. When the award is not entered in
35  30 days, any party to the action may notify the director that an award is
36  not entered and the director shall assign the matter to an assistant director
37  or to a special administrative law judge who shall enter an award forthwith
38  based on the evidence in the record, or the director, on the director's
39  own motion, may remove the case from the administrative law judge who
40  has not entered an award within 30 days following submission by the party
41  and assign it to an assistant director or to a special administrative law
42  judge for immediate decision based on the evidence in the record.
43    (d)  Not less than 10 days prior to the first full hearing before an
SB 137--Am.
                                     

 1  administrative law judge, the administrative law judge shall conduct a
 2  prehearing settlement conference for the purpose of obtaining stipula-
 3  tions from the parties, determining the issues and exploring the possibility
 4  that the parties may resolve those issues and reach a settlement prior to
 5  the first full hearing.
 6    Sec. 4.  K.S.A. 44-5,120 is hereby amended to read as follows: 44-
 7  5,120. (a) The director of workers compensation is hereby authorized and
 8  directed to establish a system for monitoring, reporting and investigating
 9  suspected fraud or abuse by any persons who are not licensed or regulated
10  by the commissioner of insurance in connection with securing the liability
11  of an employer under the workers compensation act or in connection
12  with claims or benefits thereunder. The commissioner of insurance is
13  hereby authorized and directed to establish a system for monitoring, re-
14  porting and investigating suspected fraud or abuse by any persons who
15  are licensed or regulated by the commissioner of insurance in connection
16  with securing the liability of an employer under the workers compensa-
17  tion act or in connection with claims thereunder.
18    (b)  This section applies to:
19    (1)  Persons claiming benefits under the workers compensation act;
20    (2)  employers subject to the requirements of the workers compen-
21  sation act;
22    (3)  insurance companies including group-funded self-insurance plans
23  covering Kansas employers and employees;
24    (4)  any person, corporation, business, health care facility that is or-
25  ganized either for profit or not-for-profit and that renders medical care,
26  treatment or services in accordance with the provisions of the workers
27  compensation act to an injured employee who is covered thereunder; and
28    (5)  attorneys and other representatives of employers, employees, in-
29  surers or other entities that are subject to the workers compensation act.
30    (c)  The commissioner of insurance may examine the workers com-
31  pensation records of insurance companies or self-insurers as necessary to
32  ensure compliance with the workers compensation act. Each insurance
33  company providing workers compensation insurance in Kansas, the com-
34  pany's agents, and those entities that the company has contracted to pro-
35  vide review services or to monitor services and practices under the work-
36  ers compensation act shall cooperate with the commissioner of insurance,
37  and shall make available to the commissioner any records or other nec-
38  essary information requested by the commissioner. The commissioner of
39  insurance shall conduct an examination authorized by this subsection in
40  accordance with the provisions of K.S.A. 40-222 and 40-223 and amend-
41  ments thereto.
42    (d)  Fraudulent or abusive acts or practices for purposes of the work-
43  ers compensation act include, but are not limited to, willfully or inten-
SB 137--Am.
                                     

 1  tionally:
 2    (1)  Collecting from an employee, through a deduction from wages or
 3  a subsequent fee, any premium or other fee paid by the employer to
 4  obtain workers compensation insurance coverage;
 5    (2)  misrepresenting to an insurance company or the insurance de-
 6  partment, the classification of employees of an employer, or the location,
 7  number of employees, or true identity of the employer with the intent to
 8  lessen or reduce the premium otherwise chargeable for workers com-
 9  pensation insurance coverage;
10    (3)  lending money to the claimant during the pendency of the work-
11  ers compensation claim by an attorney representing the claimant, but this
12  provision shall not prohibit the attorney from assisting the claimant in
13  obtaining financial assistance from another source, except that (A) the
14  attorney shall not have a financial interest, directly or indirectly, in the
15  source from which the loan or other financial assistance is secured and
16  (B) the attorney shall not be personally liable in any way for the credit
17  extended to the claimant;
18    (4)  obtaining, denying or attempting to obtain or deny payments of
19  workers compensation benefits for any person by:
20    (A)  Making a false or misleading statement;
21    (B)  misrepresenting or concealing a material fact;
22    (C)  fabricating, altering, concealing or destroying a document; or
23    (D)  conspiring to commit an act specified by clauses (A), (B) or (C)
24  of this subsection (d)(4);
25    (5)  bringing, prosecuting or defending an action for compensation
26  under the workers compensation act or requesting initiation of an ad-
27  ministrative violation proceeding that, in either case, has no basis in fact
28  or is not warranted by existing law or a good faith argument for the ex-
29  tension, modification or reversal of existing law;
30    (6)  breaching a provision of an agreement approved by the director;
31    (7)  withholding amounts not authorized by the director from the em-
32  ployee's or legal beneficiary's weekly compensation payment or from ad-
33  vances from any such payment;
34    (8)  entering into a settlement or agreement without the knowledge
35  and consent of the employee or legal beneficiary;
36    (9)  taking a fee or withholding expenses in excess of the amounts
37  authorized by the director;
38    (10)  refusing or failing to make prompt delivery to the employee or
39  legal beneficiary of funds belonging to the employee or legal beneficiary
40  as a result of a settlement, agreement, order or award;
41    (11)  misrepresenting the provisions of the workers compensation act
42  to an employee, an employer, a health care provider or a legal beneficiary;
43    (12)  instructing employers not to file required documents with the
SB 137--Am.
                                     

 1  director;
 2    (13)  instructing or encouraging employers to violate the employee's
 3  right to medical benefits under the workers compensation act;
 4    (14)  failing to tender promptly full death benefits if a clear and le-
 5  gitimate dispute does not exist as to the liability of the insurance company,
 6  self-insured employer or group-funded self-insurance plan;
 7    (15)  failing to confirm medical compensation benefits coverage to any
 8  person or facility providing medical treatment to a claimant if a clear and
 9  legitimate dispute does not exist as to the liability of the insurance carrier,
10  self-insured employer or group-funded self-insurance plan;
11    (16)  failing to initiate or reinstate compensation when due if a clear
12  and legitimate dispute does not exist as to the liability of the insurance
13  company, self-insured employer or group-funded self-insurance plan;
14    (17)  misrepresenting the reason for not paying compensation or ter-
15  minating or reducing the payment of compensation;
16    (18)  refusing to pay compensation as and when the compensation is
17  due;
18    (19)  refusing to pay any order awarding compensation; and
19    (20)  refusing to timely file required reports or records under the
20  workers compensation act.
21    (e)  Whenever the director or the commissioner of insurance has rea-
22  son to believe that any person has engaged or is engaging in any fraud-
23  ulent or abusive act or practice in connection with the conduct of Kansas
24  workers compensation insurance, claims, benefits or services in this state,
25  that such fraudulent or abusive act or practice is not subject to possible
26  proceedings under K.S.A. 40-2401 through 40-2421 and amendments
27  thereto by the commissioner of insurance, and that a proceeding by the
28  director or the commissioner of insurance, in the case of any person
29  licensed or regulated by the commissioner, with respect thereto would
30  be in the interest of the public, the director or the commissioner of in-
31  surance, in the case of any person licensed or regulated by the commis-
32  sioner, shall issue and serve upon such person a statement of the charges
33  with respect thereto and shall conduct a hearing thereon in accordance
34  with the provisions of the Kansas administrative procedure act. Com-
35  plaints filed with the director or the commissioner of insurance may be
36  dismissed by the director or the commissioner of insurance on their own
37  initiative, and shall be dismissed upon the written request of the com-
38  plainant, if the director or commissioner of insurance has not conducted
39  a hearing or taken other administrative action dismissing the complaint
40  within 180 days of the filing of the complaint. Any such dismissal of a
41  complaint in accordance with this section shall constitute final action by
42  the director or commissioner of insurance which shall be deemed to ex-
43  haust all administrative remedies under K.S.A. 44-5,120 and amendments
SB 137--Am.
                                     

 1  thereto for the purpose of allowing subsequent filing of the matter in court
 2  by the complainant. Dismissal of a complaint in accordance with this
 3  section shall not be subject to appeal or judicial review.
 4    (f)  If, after such hearing, the director or the commissioner of insur-
 5  ance, in the case of any person licensed or regulated by the commissioner,
 6  determines that the person charged has engaged in any fraudulent or
 7  abusive act or practice, any costs incurred as a result of conducting any
 8  administrative hearing authorized under the provisions of this section may
 9  be assessed against the person or persons found to have engaged in such
10  acts. In an appropriate case to reimburse costs incurred, such costs may
11  be awarded to a complainant. As used in this subsection, ``costs'' include
12  witness fees, mileage allowances, any costs associated with reproduction
13  of documents which become a part of the hearing record and the expense
14  of making a record of the hearing.
15    (g)  If, after such hearing, the director or the commissioner of insur-
16  ance, in the case of any person licensed or regulated by the commissioner,
17  determines that the person or persons charged have engaged in a fraud-
18  ulent or abusive act or practice the director or the commissioner of in-
19  surance, in the case of any person licensed or regulated by the commis-
20  sioner, shall issue an order requiring such person to cease and desist from
21  engaging in such act or practice and, in the exercise of discretion, may
22  order any one or more of the following:
23    (1)  Payment of a monetary penalty of not more than $1,000 for each
24  and every act constituting the fraudulent or abusive act or practice, but
25  not exceeding an aggregate penalty of $2,500 for any six-month period;
26    (2)  redress of the injury by requiring the refund of any premiums
27  paid by and requiring the payment of any moneys withheld from, any
28  employee, employer, insurance company or other person or entity ad-
29  versely affected by the act constituting a fraudulent or abusive act or
30  practice;
31    (3)  repayment of an amount equal to the total amount that the person
32  received as benefits or any other payment under the workers compen-
33  sation act and any amount that the person otherwise benefited as a result
34  of an act constituting a fraudulent or abusive act or practice, with interest
35  thereon determined so that such total amount, plus any accrued interest
36  thereon, bears interest, from the date of the payment of benefits or other
37  such payment or the date the person was benefited, at the current rate
38  of interest prescribed by law for judgments under subsection (e)(1) of
39  K.S.A. 16-204 and amendments thereto per month or fraction of a month
40  until repayment.
41    (h)  After the expiration of the time allowed for filing a petition for
42  review of an order issued under this section, if no such petition has been
43  duly filed within such time, the director at any time, after notice and
SB 137--Am.
                                     

 1  opportunity for hearing in accordance with the provisions of the Kansas
 2  administrative procedure act, may reopen and alter, modify or set aside,
 3  in whole or in part, any order issued under this section, whenever in the
 4  director's opinion conditions of fact or of law have so changed as to re-
 5  quire such action or if the public interest so requires.
 6    (i)  Upon the order of the director or the commissioner of insurance,
 7  in the case of any person licensed or regulated by the commissioner, after
 8  notice and hearing in accordance with the provisions of the Kansas ad-
 9  ministrative procedure act, any person who violates a cease and desist
10  order of the director or the commissioner of insurance, in the case of any
11  person licensed or regulated by the commissioner, issued under this sec-
12  tion may be subject, at the discretion of the director or the commissioner
13  of insurance, in the case of any person licensed or regulated by the com-
14  missioner, to a monetary penalty of not more than $10,000 for each and
15  every act or violation, but not exceeding an aggregate penalty of $50,000
16  for any six-month period in addition to any penalty imposed pursuant to
17  subsection (g).
18    (j)  Any civil fine imposed under this section shall be subject to review
19  in accordance with the act for judicial review and civil enforcement of
20  agency actions in the district court in Shawnee county.
21    (k)  All moneys received under this section for costs assessed, which
22  are not awarded to a complainant, or monetary penalties imposed shall
23  be deposited in the state treasury and credited to the workmen's com-
24  pensation fee fund.
25    Sec. 5.  K.S.A. 44-5,121 is hereby amended to read as follows: 44-
26  5,121. (a) Any person who has suffered economic loss by a fraudulent or
27  abusive act or practice shall have a cause of action against any other person
28  to recover such loss which was paid as benefits or other amounts of money
29  which were paid under the workers compensation act and to seek relief
30  for other monetary damages from such other person based on a fraudu-
31  lent or abusive act or practice, except that such other monetary damages
32  shall not include damages for nonpecuniary loss. Relief under this section
33  is to be predicated upon exhaustion of administrative remedies available
34  in K.S.A. 44-1,520 and amendments thereto.
35    (b)  Nothing in this section or K.S.A. 44-5,120 and amendments
36  thereto shall prohibit an employer from exercising a right to reimburse-
37  ment under K.S.A. 44-534a, 44-556 or 44-569a and amendments thereto.
38    Sec. 6.  K.S.A. 1996 Supp. 44-508 is hereby amended to read as fol-
39  lows: 44-508. As used in the workers compensation act:
40    (a)  ``Employer'' includes: (1) Any person or body of persons, corpo-
41  rate or unincorporate, and the legal representative of a deceased em-
42  ployer or the receiver or trustee of a person, corporation, association or
43  partnership; (2) the state or any department, agency or authority of the
SB 137--Am.
                                     

 1  state, any city, county, school district or other political subdivision or
 2  municipality or public corporation and any instrumentality thereof; and
 3    (3) for the purposes of community service work, the entity for which the
 4  community service work is being performed and the governmental agency
 5  which assigned the community service work, if any, if either such entity
 6  or such governmental agency has filed a written statement of election
 7  with the director to accept the provisions under the workers compensa-
 8  tion act for persons performing community service work and in such case
 9  such entity and such governmental agency shall be deemed to be the joint
10  employer of the person performing the community service work and both
11  shall have the rights, liabilities and immunities provided under the work-
12  ers compensation act for an employer with regard to the community serv-
13  ice work, except that the liability for providing benefits shall be imposed
14  only on the party which filed such election with the director, or on both
15  if both parties have filed such election with the director; for purposes of
16  community service work, ``governmental agency'' shall not include any
17  court or any officer or employee thereof and any case where there is
18  deemed to be a ``joint employer'' shall not be construed to be a case of
19  dual or multiple employment.
20    (b)  ``Workman'' or ``employee'' or ``worker'' means any person who
21  has entered into the employment of or works under any contract of serv-
22  ice or apprenticeship with an employer. Such terms shall include but not
23  be limited to: Executive officers of corporations; professional athletes;
24  persons serving on a volunteer basis as duly authorized law enforcement
25  officers, ambulance attendants, mobile intensive care technicians, fire-
26  fighters, but only to the extent and during such periods as they are so
27  serving in such capacities; persons employed by educational, religious and
28  charitable organizations, but only to the extent and during the periods
29  that they are paid wages by such organizations; persons in the service of
30  the state, or any department, agency or authority of the state, any city,
31  school district, or other political subdivision or municipality or public
32  corporation and any instrumentality thereof, under any contract of serv-
33  ice, express or implied, and every official or officer thereof, whether
34  elected or appointed, while performing official duties; persons in the serv-
35  ice of the state as volunteer members of the Kansas department of civil
36  air patrol, but only to the extent and during such periods as they are
37  officially engaged in the performance of functions specified in K.S.A. 48-
38  3302 and amendments thereto; volunteers in any employment, if the em-
39  ployer has filed an election to extend coverage to such volunteers; minors,
40  whether such minors are legally or illegally employed; and persons per-
41  forming community service work, but only to the extent and during such
42  periods as they are performing community service work and if an election
43  has been filed an election to extend coverage to such persons. Any ref-
SB 137--Am.
                                     

 1  erence to an employee who has been injured shall, where the employee
 2  is dead, include a reference to the employee's dependents, to the em-
 3  ployee's legal representatives, or, if the employee is a minor or an inca-
 4  pacitated person, to the employee's guardian or conservator. Unless there
 5  is a valid election in effect which has been filed as provided in K.S.A. 44-
 6  542a and amendments thereto, such terms shall not include individual
 7  employers, limited or general partners or self-employed persons, except
 8  a self-employed subcontractor performing work for a contractor.
 9    (c) (1)  ``Dependents'' means such members of the employee's family
10  as were wholly or in part dependent upon the employee at the time of
11  the accident.
12    (2)  ``Members of a family'' means only surviving legal spouse and
13  children; or if no surviving legal spouse or children, then parents or grand-
14  parents; or if no parents or grandparents, then grandchildren; or if no
15  grandchildren, then brothers and sisters. In the meaning of this section,
16  parents include stepparents, children include stepchildren, grandchildren
17  include stepgrandchildren, brothers and sisters include stepbrothers and
18  stepsisters, and children and parents include that relation by legal adop-
19  tion. In the meaning of this section, a surviving spouse shall not be re-
20  garded as a dependent of a deceased employee or as a member of the
21  family, if the surviving spouse shall have for more than six months willfully
22  or voluntarily deserted or abandoned the employee prior to the date of
23  the employee's death.
24    (3)  ``Wholly dependent child or children'' means:
25    (A)  A birth child or adopted child of the employee except such a child
26  whose relationship to the employee has been severed by adoption;
27    (B)  a stepchild of the employee who lives in the employee's house-
28  hold;
29    (C)  any other child who is actually dependent in whole or in part on
30  the employee and who is related to the employee by marriage or consan-
31  guinity; or
32    (D)  any child as defined in subsections (3)(A), (3)(B) or (3)(C) who
33  is less than 23 years of age and who is not physically or mentally capable
34  of earning wages in any type of substantial and gainful employment or
35  who is a full-time student attending an accredited institution of higher
36  education or vocational education.
37    (d)  ``Accident'' means an undesigned, sudden and unexpected event
38  or events, usually of an afflictive or unfortunate nature and often, but not
39  necessarily, accompanied by a manifestation of force. The elements of an
40  accident, as stated herein, are not to be construed in a strict and literal
41  sense, but in a manner designed to effectuate the purpose of the workers
42  compensation act that the employer bear the expense of accidental injury
43  to a worker caused by the employment.
SB 137--Am.
                                     

 1    (e)  ``Personal injury'' and ``injury'' mean any lesion or change in the
 2  physical structure of the body, causing damage or harm thereto, so that
 3  it gives way under the stress of the worker's usual labor. It is not essential
 4  that such lesion or change be of such character as to present external or
 5  visible signs of its existence.  An injury shall not be deemed to have been
 6  directly caused by the employment where it is shown that the employee
 7  suffers disability as a result of the natural aging process or by the normal
 8  activities of day-to-day living.
 9    (f)  The words ``arising out of and in the course of employment'' as
10  used in the workers compensation act shall not be construed to include
11  injuries to the employee occurring while the employee is on the way to
12  assume the duties of employment or after leaving such duties, the prox-
13  imate cause of which injury is not the employer's negligence. An em-
14  ployee shall not be construed as being on the way to assume the duties
15  of employment or having left such duties at a time when the worker is
16  on the premises of the employer or on the only available route to or from
17  work which is a route involving a special risk or hazard and which is a
18  route not used by the public except in dealings with the employer. An
19  employee shall not be construed as being on the way to assume the duties
20  of employment, if the employee is a provider of emergency services re-
21  sponding to an emergency.
22    The words, ``arising out of and in the course of employment'' as used
23  in the workers compensation act shall not be construed to include injuries
24  to employees while engaged in recreational or social events under cir-
25  cumstances where the employee was under no duty to attend and where
26  the injury did not result from the performance of tasks related to the
27  employee's normal job duties or as specifically instructed to be performed
28  by the employer.
29    (g)  ``Burden of proof'' means the burden of a party to persuade the
30  trier of facts by a preponderance of the credible evidence that such party's
31  position on an issue is more probably true than not true on the basis of
32  the whole record.
33    (h)  ``Director'' means the director of workers compensation as pro-
34  vided for in K.S.A. 75-5708 and amendments thereto.
35    (i)  ``Health care provider'' means any person licensed, by the proper
36  licensing authority of this state, another state or the District of Columbia,
37  to practice medicine and surgery, osteopathy, chiropractic, dentistry, op-
38  tometry, podiatry or psychology.
39    (j)  ``Secretary'' means the secretary of human resources.
40    (k)  ``Construction design professional'' means any person who is an
41  architect, professional engineer, landscape architect or land surveyor who
42  has been issued a license by the state board of technical professions to
43  practice such technical profession in Kansas or any corporation organized
SB 137--Am.
                                     

 1  to render professional services through the practice of one or more of
 2  such technical professions in Kansas under the professional corporation
 3  law of Kansas or any corporation issued a certificate of authorization un-
 4  der K.S.A. 74-7036 and amendments thereto to practice one or more of
 5  such technical professions in Kansas.
 6    (l)  ``Community service work'' means: (1) Public or community serv-
 7  ice performed as a result of a contract of diversion or of assignment to a
 8  community corrections program or conservation camp or suspension of
 9  sentence or as a condition of probation or in lieu of a fine imposed by
10  court order; or (2) public or community service or other work performed
11  as a requirement for receipt of any kind of public assistance in accordance
12  with any program administered by the secretary of social and rehabilita-
13  tion services.
14    (m)  ``Utilization review'' means the initial evaluation of appropriate-
15  ness in terms of both the level and the quality of health care and health
16  services provided a patient, based on accepted standards of the health
17  care profession involved. Such evaluation is accomplished by means of a
18  system which identifies the utilization of health care services above the
19  usual range of utilization for such services, which is based on accepted
20  standards of the health care profession involved, and which refers in-
21  stances of possible inappropriate utilization to the director for referral to
22  a peer review committee.
23    (n)  ``Peer review'' means an evaluation by a peer review committee
24  of the appropriateness, quality and cost of health care and health services
25  provided a patient, which is based on accepted standards of the health
26  care profession involved and which is conducted in conjunction with util-
27  ization review.
28    (o)  ``Peer review committee'' means a committee composed of health
29  care providers licensed to practice the same health care profession as the
30  health care provider who rendered the health care services being re-
31  viewed.
32    (p)  ``Group-funded self-insurance plan'' includes each group-funded
33  workers compensation pool, which is authorized to operate in this state
34  under K.S.A. 44-581 through 44-592 and amendments thereto, each mu-
35  nicipal group-funded pool under the Kansas municipal group-funded pool
36  act which is covering liabilities under the workers compensation act, and
37  any other similar group-funded or pooled plan or arrangement that pro-
38  vides coverage for employer liabilities under the workers compensation
39  act and is authorized by law.
40    (q)  On and after the effective date of this act, ``workers compensation
41  board'' or ``board'' means the workers compensation board established
42  under K.S.A. 1996 Supp. 44-555c and amendments thereto.
43    Sec. 7.  K.S.A. 1996 Supp. 44-532 is hereby amended to read as fol-
SB 137--Am.
                                     

 1  lows: 44-532. (a) Where the payment of compensation of the employee
 2  or the employee's dependents is insured by a policy or policies, at the
 3  expense of the employer, or the employer is a member of a qualified
 4  group-funded workers compensation pool, the insurer or the qualified
 5  group-funded workers compensation pool shall be subrogated to the
 6  rights and duties under the workers compensation act of the employer so
 7  far as appropriate, including the immunities provided by K.S.A. 44-501
 8  and amendments thereto.
 9    (b)  Every employer shall secure the payment of compensation to the
10  employer's employees by insuring in one of the following ways: (1) By
11  insuring and keeping insured the payment of such compensation with an
12  insurance carrier authorized to transact the business of workers compen-
13  sation insurance in the state of Kansas; (2) by showing to the director that
14  the employer carries such employer's own risk and is what is known as a
15  self-insurer and by furnishing proof to the director of the employer's
16  financial ability to pay such compensation for the employer's self; (3) by
17  maintaining a membership in a qualified group-funded workers compen-
18  sation pool. The cost of carrying such insurance or risk shall be paid by
19  the employer and not the employee.
20    (c)  The knowing and intentional failure of an employer to secure the
21  payment of workers compensation to the employer's employees as re-
22  quired in subsection (b) of this section is a class A misdemeanor.
23    (d)  In addition, whenever the director has reason to believe that any
24  employer has engaged or is engaging in the knowing and intentional fail-
25  ure to secure the payment of workers compensation to the employer's
26  employees as required in subsection (b) of this section, the director shall
27  issue and serve upon such employer a statement of the charges with
28  respect thereto and shall conduct a hearing in accordance with the Kansas
29  administrative procedure act, wherein the employer may be liable to the
30  state for a civil penalty in an amount equal to twice the annual premium
31  the employer would have paid had such employer been insured or
32  $25,000, whichever amount is greater.
33    (e)  Any civil penalty imposed or final action taken under this section
34  shall be subject to review in accordance with the act for judicial review
35  of agency actions in the district court of Shawnee county.
36    (f)  All moneys received under this section for costs assessed or mon-
37  etary penalties imposed shall be deposited in the state treasury and cred-
38  ited to the workers compensation fund.
39    (g) (1)  Every insurance carrier writing workers' compensation insur-
40  ance for any employment covered under the workers compensation act
41  shall file, with the director, written notice of the issuance, nonrenewal or
42  cancellation of a policy or contract of insurance, or any endorsement,
43  providing workers compensation coverage, within 10 days after such is-
SB 137--Am.
                                     

 1  suance, nonrenewal or cancellation. Every such insurance carrier shall
 2  file, with the director, written notice of all such policies, contracts and
 3  endorsements in force on the effective date of this act.
 4    (2)  Every employer covered by the workers compensation act who is
 5  a qualified self-insurer shall give written notice to the director if such
 6  employer changes from a self-insurer status to insuring through an in-
 7  surance carrier or by maintaining a membership in a qualified group-
 8  funded workers compensation pool, such notice to be given within 10
 9  days after the effective date of such change. Every self-insurer shall file
10  with the director annually a report verifying the employer's continuing
11  ability to pay compensation to the employer's employees.
12    (3)  Every employer covered by the workers compensation act who is
13  a member of a qualified group-funded workers compensation pool shall
14  give written notice to the director if such employer changes from a group-
15  funded workers compensation pool to insuring through an insurance car-
16  rier or becoming a self-insurer, such notice to be given within 10 days
17  after the effective date of such change.
18    (4)  The mailing of any written notice or report required by this sub-
19  section (d) in a stamped envelope within the prescribed time shall comply
20  with the requirements of this subsection.
21    (5)  The director shall provide by regulation for the forms of written
22  notices and reports required by this subsection (d).
23    (h)  As used in this section, ``qualified group-funded workers com-
24  pensation pool'' means any qualified group-funded workers compensation
25  pool under K.S.A. 44-581 through 44-591 and amendments thereto or
26  any group-funded pool under the Kansas municipal group-funded pool
27  act which includes workers compensation and employers' liability under
28  the workers compensation act.
29    (i)  A private firm shall not be eligible to apply to become a self-insurer
30  unless it has been in continuous operation for at least five years or is
31  purchasing an existing self-insured Kansas firm, plant or facility and the
32  operation of the purchased firm, plant or facility: (1) Has been in contin-
33  uous operation in Kansas for at least 10 years; (2) has generated an after-
34  tax profit of at least $1,000,000 annually for the preceding three consec-
35  utive years; and (3) has a ratio of debt to equity of not greater than 3.5
36  to 1. As used in this subsection, ``debt'' means the sum of long-term
37  borrowing maturing in excess of one year plus the current portion of long-
38  term borrowing plus short-term financial institution borrowing plus com-
39  mercial paper borrowing, and ``equity'' means the sum of the book value
40  of stock plus paid-in capital plus retained earnings. The method for cal-
41  culating the amount of security required of self insureds shall be reviewed
42  by an actuary every five years, beginning in fiscal year 1997. The costs
43  for these actuarial studies shall be paid from the workers compensation
SB 137--Am.
                                     

 1  fee fund.
 2    (j)  A corporation or other entity whose current identity is attributable
 3  to a merger or other transformation whereby the whole or a substantial
 4  part of a previous entity's assets and income have been transferred to it,
 5  and its liabilities have not increased beyond the financial review require-
 6  ments of the director, which qualified under its previous identity as a self-
 7  insurer under other provisions of this statute, and amendments thereto,
 8  may apply for renewal as a self-insurer under its new name. The director
 9  may grant the application for renewal if satisfied that the new entity meets
10  all necessary financial criteria for renewal that would have been applied
11  to the previous self-insured entity. An application under these provisions
12  shall be limited to an entity seeking renewal based upon the prior self-
13  insured status of another entity or entities.
14    Sec. 8.  K.S.A. 1996 Supp. 44-551 is hereby amended to read as fol-
15  lows: 44-551. (a) The duties of the assistant directors of workers com-
16  pensation shall include but not be limited to acting in the capacity of an
17  administrative law judge.
18    (b) (1)  Administrative law judges shall have power to administer
19  oaths, certify official acts, take depositions, issue subpoenas, compel the
20  attendance of witnesses and the production of books, accounts, papers,
21  documents and records to the same extent as is conferred on the district
22  courts of this state, and may conduct an investigation, inquiry or hearing
23  on all matters before the administrative law judges. All acts, findings,
24  awards, decisions, rulings or modifications of findings or awards made by
25  an administrative law judge shall be subject to review by the board upon
26  written request of any interested party within 10 days. Intermediate Sat-
27  urdays, Sundays and legal holidays shall be excluded in the time com-
28  putation. Review by the board shall be a prerequisite to judicial review
29  as provided for in K.S.A. 44-556 and amendments thereto. On any such
30  review, the board shall have authority to grant or refuse compensation,
31  or to increase or diminish any award of compensation or to remand any
32  matter to the administrative law judge for further proceedings.
33    (2) (A)  If an administrative law judge has entered a preliminary
34  award under K.S.A. 44-534a and amendments thereto, a review by the
35  board shall not be conducted under this section unless it is alleged that
36  the administrative law judge exceeded the administrative law judge's ju-
37  risdiction in granting or denying the relief requested at the preliminary
38  hearing. Such an appeal from a preliminary award may be heard and
39  decided by a single member of the board. Members of the board shall
40  hear such preliminary appeals on a rotating basis and the individual board
41  member who decides the appeal shall sign each such decision. The orders
42  of the board on any acts, findings, awards, decisions, rulings or modifi-
43  cations of findings or awards shall be issued within 30 days from the date
SB 137--Am.
                                     

 1  arguments were presented by the parties.
 2    (B)  If an order on review is not issued by the board within the ap-
 3  plicable time period prescribed by subsection (b)(2)(A), medical com-
 4  pensation and any disability compensation as provided in the award of
 5  the administrative law judge shall be paid commencing with the first day
 6  after such time period and shall continue to be paid until the order of
 7  the board is issued, except that no payments shall be made under this
 8  provision for any period before the first day after such time period. Noth-
 9  ing in this section shall be construed to limit or restrict any other remedies
10  available to any party to a claim under any other statute.
11    (C)  In any case in which the final award of an administrative law judge
12  is appealed to the board for review under this section and in which the
13  compensability is not an issue to be decided on review by the board,
14  medical compensation shall be payable in accordance with the award of
15  the administrative law judge and shall not be stayed pending such review.
16  The employee may proceed under K.S.A. 44-534a and amendments
17  thereto and may have a hearing in accordance with that statute to enforce
18  the provisions of this subsection.
19    (c)  Each assistant director and each administrative law judge or spe-
20  cial administrative law judge shall be allowed all reasonable and necessary
21  expenses actually incurred while in the actual discharge of official duties
22  in administering the workers compensation act, but such expenses shall
23  be sworn to by the person incurring the same and be approved by the
24  secretary.
25    (d)  In case of emergency the director may appoint special local ad-
26  ministrative law judges and assign to them the examination and hearing
27  of any designated case or cases. Such special local administrative law
28  judges shall be attorneys and admitted to practice law in the state of
29  Kansas and shall, as to all cases assigned to them, exercise the same pow-
30  ers as provided by this section for the regular administrative law judges.
31  Special local administrative law judges shall receive a fee commensurate
32  with the services rendered as fixed by rules and regulations adopted by
33  the director. The fees prescribed by this section prior to the effective date
34  of this act shall be effective until different fees are fixed by such rules
35  and regulations.
36    (e)  All special local administrative law judge's fees and expenses, with
37  the exception of settlement hearings, shall be paid from the workers com-
38  pensation administration fee fund, as provided in K.S.A. 74-712 and
39  amendments thereto. Where there are no available funds or where the
40  special local administrative law judge conducted a settlement hearing, the
41  fees shall be taxed as cost costs in each case heard by such special local
42  administrative law judge and when collected shall be paid directly to such
43  special local administrative law judge by the party charged with the pay-
SB 137--Am.
                                     

 1  ment of the same.
 2    (f)  Except as provided for judicial review under K.S.A. 44-556 and
 3  amendments thereto, the decisions and awards of the board shall be final.
 4    Sec. 9.  K.S.A. 1996 Supp. 44-555c is hereby amended to read as
 5  follows: 44-555c. (a) There is hereby established the workers compen-
 6  sation board. The board shall have exclusive jurisdiction to review all
 7  decisions, findings, orders and awards of compensation of administrative
 8  law judges under the workers compensation act. The review by the board
 9  shall be upon questions of law and fact as presented and shown by a
10  transcript of the evidence and the proceedings as presented, had and
11  introduced before the administrative law judge. The board shall be within
12  the division of workers compensation of the department of human re-
13  sources and all budgeting, personnel, purchasing and related manage-
14  ment functions of the board shall be administered under the supervision
15  and direction of the secretary of human resources. The board shall consist
16  of five members who shall be appointed by the secretary in accordance
17  with this section and who shall each serve for a term of four years, except
18  as provided for the first members appointed to the board under subsec-
19  tion (f).
20    (b)  Each board member shall be an attorney regularly admitted to
21  practice law in Kansas for a period of at least seven years and shall have
22  engaged in the active practice of law during such period as a lawyer, judge
23  of a court of record or any court in Kansas or a full-time teacher of law
24  in an accredited law school, or any combination of such types of practice.
25    (c)  Each board member shall receive an annual salary in an amount
26  equal to the salary prescribed by law for a district judge, except that the
27  member who is the chairperson of the workers compensation board shall
28  receive an annual salary in an amount equal to the salary prescribed for
29  a district judge designated as administrative judge of a district court of
30  Kansas. The board members shall devote full time to the duties of such
31  office and shall not engage in the private practice of law during their term
32  of office. No board member may receive additional compensation for
33  official services performed by the board member. Each board member
34  shall be reimbursed for expenses incurred in the performance of such
35  official duties under the same circumstances and to the same extent as
36  judges of the district court are reimbursed for such expenses.
37    (d)  Applications for membership on the board shall be submitted to
38  the director of workers compensation. The director shall determine if an
39  applicant meets the qualifications for membership on the board pre-
40  scribed in subsection (b). Qualified applicants for the board will be sub-
41  mitted by the director to the workers compensation board nominating
42  committee for consideration.
43    (e)  There is hereby established the workers compensation board
SB 137--Am.
                                     

 1  nominating committee which shall be composed of two members ap-
 2  pointed as follows:   The Kansas AFL-CIO and the Kansas chamber of
 3  commerce and industry shall each select one representative to serve on
 4  the workers compensation board nominating committee and shall give
 5  written notice of the selection to the secretary who shall appoint such
 6  representatives to the committee. In the event of a vacancy occurring for
 7  any reason on the nominating committee, the respective member shall
 8  be replaced by the appointing organization with written notice of the
 9  appointment to the secretary of human resources within 30 days of such
10  vacancy.
11    (f) (1)  Upon being notified of any vacancy on the board or of the
12  need to appoint a member pro tem under subsection (i), the nominating
13  committee shall consider all qualified applicants submitted by the director
14  for the vacant position on the board or the member pro tem position and
15  nominate a person qualified therefor. The nominating committee shall
16  be required to reach unanimous agreement on any nomination to the
17  board. With respect to each person nominated, the secretary either shall
18  accept and appoint the person nominated by the nominating committee
19  to the position on the board for which the nomination was made or shall
20  reject the nomination and request the nominating committee to nominate
21  another person for that position. Upon receipt of any such request for
22  the nomination of another person, the nominating committee shall nom-
23  inate another person for that position in the same manner.
24    (2)  The first members of the board established by this section are
25  hereby appointed as follows:  Each person who was a member of the
26  workers compensation board which was in existence on January 12, 1995,
27  is hereby appointed, effective January 13, 1995, as a member of the board
28  established by this section. The term of office of each person so appointed
29  as a member of the board established by this section is for the period
30  equal to the remainder of the term of office such person had as of January
31  12, 1995, as a member of the workers compensation board which was in
32  existence on January 12, 1995.
33    (3)  Each member of the board shall hold office for the term of the
34  appointment and until the successor shall have been appointed. Succes-
35  sors to such members shall be appointed for terms of four years.
36    (4)  If a vacancy should occur on the board during the term of a mem-
37  ber, the nominating committee shall nominate an individual from the
38  qualified applicants submitted by the director to complete the remainder
39  of the unexpired portion of the term. With respect to each person so
40  nominated, the secretary either shall accept and appoint the person nom-
41  inated to the board or shall reject the nomination and request the nom-
42  inating committee to nominate another person for the position. Upon
43  receipt of any such request for the nomination of another person, the
SB 137--Am.
                                     

 1  nominating committee shall nominate another person for the position in
 2  the same manner.
 3    (g)  Following the completion of a term, board members who wish to
 4  be considered for reappointment to the board shall be deemed to have
 5  met the qualification requirements for selection to the board and shall
 6  be considered for renomination by the workers compensation board nom-
 7  inating committee.
 8    (h)  The members of the board shall annually elect one member to
 9  serve as chairperson.
10    (i)  If illness or other temporary disability of a member of the board
11  will not permit the member to serve during a case or in any case in which
12  a member of the board must be excused from serving because of a conflict
13  or is otherwise disqualified with regard to such case, the director shall
14  notify the workers compensation nominating committee of the need to
15  appoint a member pro tem. Upon receipt of such notice, the committee
16  shall act as soon as possible and nominate a qualified person to serve as
17  member pro tem in such case in accordance with subsection (f). Each
18  member pro tem shall receive compensation at the same rate as a member
19  of the board receives, prorated for the days hours of actual service as a
20  member pro tem and shall receive expenses under the same circum-
21  stances and to the same extent as a member of the board receives. Each
22  member pro tem shall have all the powers, duties and functions of a
23  member of the board with regard to the case.
24    (j)  The board shall maintain principal offices in Topeka, Kansas, and
25  the board may conduct hearings at a courthouse of any county in Kansas
26  or at another location specified by the board. The secretary of human
27  resources shall provide a courtroom and other suitable quarters in To-
28  peka, Kansas, for the use of the board and its staff. When the board
29  conducts hearings at any location other than in Topeka, Kansas, the di-
30  rector shall make suitable arrangements for such hearings. Subject to the
31  provisions of appropriation acts, the director shall provide such supplies
32  and equipment and shall appoint such support personnel as may be nec-
33  essary for the board to fulfill the duties imposed by this act, subject to
34  approval by the secretary.
35    (k)  For purposes of hearing cases, the board may sit together or in
36  panels of two members or more, designated by the chairperson of the
37  board, except that an appeal from a preliminary award entered under
38  K.S.A. 44-534a and amendments thereto may be heard by a panel of one
39  member designated by the chairperson. All members of the board shall
40  determine each matter before the board. All decisions, reviews and de-
41  terminations by the board shall be approved in writing by at least three
42  board members. Whenever the board enters a final order in any pro-
43  ceeding, the board shall make written findings of fact and conclusions of
SB 137--Am.
                                     

 1  law forming the basis of the board's determination and final order. The
 2  findings of fact and conclusions of law of the board shall be made a part
 3  of the final order. The board shall mail a copy of the final order of the
 4  board to all parties to the proceeding within three days following the
 5  issuance of the final order.
 6    Sec. 10.  K.S.A. 1996 Supp. 44-5,125 is hereby amended to read as
 7  follows: 44-5,125. (a) (1) Any person who obtains or attempts to obtain
 8  any payment of compensation under the workers compensation act for
 9  such person or who denies or attempts to deny the obligation to make
10  any payment of workers compensation benefits; who obtains or attempts
11  to obtain a more favorable workers compensation benefit rate or insur-
12  ance premium rate than that to which such person is otherwise entitled;
13  who prevents, reduces, avoids or attempts to prevent, reduce or avoid the
14  payment of any compensation under the workers compensation act; or
15  who fails to communicate a settlement offer or similar information to a
16  claimant under the workers compensation act, by, in any such case, know-
17  ingly or intentionally: (A) Making a false or misleading statement, (B)
18  misrepresenting or concealing a material fact, or (C) fabricating, altering,
19  concealing or destroying a document; and (2) any person who conspires
20  with another person to commit any act described by clause (1) of this
21  subsection (a), shall be guilty of:
22    (A)  A class A nonperson misdemeanor, if the amount received as a
23  benefit or other payment under the workers compensation act as a result
24  of such act or the amount that the person otherwise benefited monetarily
25  as a result of a violation of this subsection (a) is $500 or less; or
26    (B)  a severity level 9, nonperson felony, if such amount is more than
27  $500.
28    (b)  Any person who has received any amount of money as a benefit
29  or other payment under the workers compensation act as a result of a
30  violation of subsection (a) and any person who has otherwise benefited
31  monetarily as a result of a violation of subsection (a) shall be liable to
32  repay an amount equal to the amount so received by such person or the
33  amount by which such person has benefited monetarily, with interest
34  thereon. Any such amount, plus any accrued interest thereon, shall bear
35  interest at the current rate of interest prescribed by law for judgments
36  under subsection (e)(1) of K.S.A. 16-204 and amendments thereto per
37  month or fraction of a month until repayment of such amount, plus any
38  accrued interest thereon. The interest shall accrue from the date of over-
39  payment or erroneous payment of any such amount or the date such
40  person benefited monetarily.
41    (c)  Any person aggrieved by a violation of subsection (a) shall have a
42  cause of action against any other person to recover any amounts of money
43  erroneously paid as benefits or any other amounts of money paid under
SB 137--Am.
                                     

 1  the workers compensation act, and to seek relief for other monetary dam-
 2  ages, for which liability has accrued under this section against such other
 3  person. Relief under this section subsection is to be predicated upon
 4  exhaustion of administrative remedies available in K.S.A. 44-5,120 and
 5  amendments thereto.
 6    (d)  Nothing in this section shall prohibit an employer from exercising
 7  a right to reimbursement under K.S.A. 44-534a, 44-556 or 44-569a and
 8  amendments thereto.
 9    Sec. 11.  K.S.A. 44-505, 44-510b, 44-523, 44-5,120 and 44-5,121 and
10  K.S.A. 1996 Supp. 44-508, 44-532, 44-532b, 44-551, 44-555c and 44-
11  5,125 are hereby repealed.
12    Sec. 12.  This act shall take effect and be in force from and after its
13  publication in the statute book.