74th OREGON LEGISLATIVE ASSEMBLY--2007 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 1281
 
                         Senate Bill 463
 
Sponsored by COMMITTEE ON BUSINESS, TRANSPORTATION AND WORKFORCE
  DEVELOPMENT (at the request of Self-Insurers Association)
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
 
  Extends period for acceptance or denial of workers'
compensation claim from 60 days to 90 days.
 
                        A BILL FOR AN ACT
Relating to processing of workers' compensation claims; creating
  new provisions; and amending ORS 656.262, 656.308, 656.325 and
  656.386.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 656.262 is amended to read:
  656.262. (1) Processing of claims and providing compensation
for a worker shall be the responsibility of the insurer or
self-insured employer. All employers shall assist their insurers
in processing claims as required in this chapter.
  (2) The compensation due under this chapter shall be paid
periodically, promptly and directly to the person entitled
thereto upon the employer's receiving notice or knowledge of a
claim, except where the right to compensation is denied by the
insurer or self-insured employer.
  (3)(a) Employers shall, immediately and not later than five
days after notice or knowledge of any claims or accidents which
may result in a compensable injury claim, report the same to
their insurer. The report shall include:
  (A) The date, time, cause and nature of the accident and
injuries.
  (B) Whether the accident arose out of and in the course of
employment.
  (C) Whether the employer recommends or opposes acceptance of
the claim, and the reasons therefor.
  (D) The name and address of any health insurance provider for
the injured worker.
  (E) Any other details the insurer may require.
  (b) Failure to so report subjects the offending employer to a
charge for reimbursing the insurer for any penalty the insurer is
required to pay under subsection (11) of this section because of
such failure. As used in this subsection, 'health insurance' has
the meaning for that term provided in ORS 731.162.
  (4)(a) The first installment of temporary disability
compensation shall be paid no later than the 14th day after the
subject employer has notice or knowledge of the claim, if the
attending physician or nurse practitioner authorized to provide
compensable medical services under ORS 656.245 authorizes the
payment of temporary disability compensation. Thereafter,
temporary disability compensation shall be paid at least once
each two weeks, except where the Director of the Department of
Consumer and Business Services determines that payment in
installments should be made at some other interval. The director
may by rule convert monthly benefit schedules to weekly or other
periodic schedules.
  (b) Notwithstanding any other provision of this chapter, if a
self-insured employer pays to an injured worker who becomes
disabled the same wage at the same pay interval that the worker
received at the time of injury, such payment shall be deemed
timely payment of temporary disability payments pursuant to ORS
656.210 and 656.212 during the time the wage payments are made.
  (c) Notwithstanding any other provision of this chapter, when
the holder of a public office is injured in the course and scope
of that public office, full official salary paid to the holder of
that public office shall be deemed timely payment of temporary
disability payments pursuant to ORS 656.210 and 656.212 during
the time the wage payments are made. As used in this subsection,
' public office' has the meaning for that term provided in ORS
260.005.
  (d) Temporary disability compensation is not due and payable
for any period of time for which the insurer or self-insured
employer has requested from the worker's attending physician or
nurse practitioner authorized to provide compensable medical
services under ORS 656.245 verification of the worker's inability
to work resulting from the claimed injury or disease and the
physician or nurse practitioner cannot verify the worker's
inability to work, unless the worker has been unable to receive
treatment for reasons beyond the worker's control.
  (e) If a worker fails to appear at an appointment with the
worker's attending physician or nurse practitioner authorized to
provide compensable medical services under ORS 656.245, the
insurer or self-insured employer shall notify the worker by
certified mail that temporary disability benefits may be
suspended after the worker fails to appear at a rescheduled
appointment. If the worker fails to appear at a rescheduled
appointment, the insurer or self-insured employer may suspend
payment of temporary disability benefits to the worker until the
worker appears at a subsequent rescheduled appointment.
  (f) If the insurer or self-insured employer has requested and
failed to receive from the worker's attending physician or nurse
practitioner authorized to provide compensable medical services
under ORS 656.245 verification of the worker's inability to work
resulting from the claimed injury or disease, medical services
provided by the attending physician or nurse practitioner are not
compensable until the attending physician or nurse practitioner
submits such verification.
  (g) Temporary disability compensation is not due and payable
pursuant to ORS 656.268 after the worker's attending physician or
nurse practitioner authorized to provide compensable medical
services under ORS 656.245 ceases to authorize temporary
disability or for any period of time not authorized by the
attending physician or nurse practitioner. No authorization of
temporary disability compensation by the attending physician or
nurse practitioner under ORS 656.268 shall be effective to
retroactively authorize the payment of temporary disability more
than 14 days prior to its issuance.
  (h) The worker's disability may be authorized only by a person
described in ORS 656.005 (12)(b)(B) or 656.245 for the period of
time permitted by those sections. The insurer or self-insured
employer may unilaterally suspend payment of temporary disability
benefits to the worker at the expiration of the period until
temporary disability is reauthorized by an attending physician or
 
nurse practitioner authorized to provide compensable medical
services under ORS 656.245.
  (i) The insurer or self-insured employer may unilaterally
suspend payment of all compensation to a worker enrolled in a
managed care organization if the worker continues to seek care
from an attending physician or nurse practitioner authorized to
provide compensable medical services under ORS 656.245 that is
not authorized by the managed care organization more than seven
days after the mailing of notice by the insurer or self-insured
employer.
  (5) Payment of compensation under subsection (4) of this
section or payment, in amounts not to exceed $1,500 per claim,
for medical services for nondisabling claims, may be made by the
subject employer if the employer so chooses. The making of such
payments does not constitute a waiver or transfer of the
insurer's duty to determine entitlement to benefits. If the
employer chooses to make such payment, the employer shall report
the injury to the insurer in the same manner that other injuries
are reported.  However, an insurer shall not modify an employer's
experience rating or otherwise make charges against the employer
for any medical expenses paid by the employer pursuant to this
subsection.
  (6)(a) Written notice of acceptance or denial of the claim
shall be furnished to the claimant by the insurer or self-insured
employer within   { - 60 - }   { + 90 + } days after the employer
has notice or knowledge of the claim. Once the claim is accepted,
the insurer or self-insured employer shall not revoke acceptance
except as provided in this section. The insurer or self-insured
employer may revoke acceptance and issue a denial at any time
when the denial is for fraud, misrepresentation or other illegal
activity by the worker. If the worker requests a hearing on any
revocation of acceptance and denial alleging fraud,
misrepresentation or other illegal activity, the insurer or
self-insured employer has the burden of proving, by a
preponderance of the evidence, such fraud, misrepresentation or
other illegal activity. Upon such proof, the worker then has the
burden of proving, by a preponderance of the evidence, the
compensability of the claim. If the insurer or self-insured
employer accepts a claim in good faith, in a case not involving
fraud, misrepresentation or other illegal activity by the worker,
and later obtains evidence that the claim is not compensable or
evidence that the insurer or self-insured employer is not
responsible for the claim, the insurer or self-insured employer
may revoke the claim acceptance and issue a formal notice of
claim denial, if such revocation of acceptance and denial is
issued no later than two years after the date of the initial
acceptance. If the worker requests a hearing on such revocation
of acceptance and denial, the insurer or self-insured employer
must prove, by a preponderance of the evidence, that the claim is
not compensable or that the insurer or self-insured employer is
not responsible for the claim. Notwithstanding any other
provision of this chapter, if a denial of a previously accepted
claim is set aside by an Administrative Law Judge, the Workers'
Compensation Board or the court, temporary total disability
benefits are payable from the date any such benefits were
terminated under the denial. Except as provided in ORS 656.247,
pending acceptance or denial of a claim, compensation payable to
a claimant does not include the costs of medical benefits or
burial expenses. The insurer shall also furnish the employer a
copy of the notice of acceptance.
  (b) The notice of acceptance shall:
  (A) Specify what conditions are compensable.
  (B) Advise the claimant whether the claim is considered
disabling or nondisabling.
  (C) Inform the claimant of the Expedited Claim Service and of
the hearing and aggravation rights concerning nondisabling
injuries, including the right to object to a decision that the
injury of the claimant is nondisabling by requesting
reclassification pursuant to ORS 656.277.
  (D) Inform the claimant of employment reinstatement rights and
responsibilities under ORS chapter 659A.
  (E) Inform the claimant of assistance available to employers
and workers from the Reemployment Assistance Program under ORS
656.622.
  (F) Be modified by the insurer or self-insured employer from
time to time as medical or other information changes a previously
issued notice of acceptance.
  (c) An insurer's or self-insured employer's acceptance of a
combined or consequential condition under ORS 656.005 (7),
whether voluntary or as a result of a judgment or order, shall
not preclude the insurer or self-insured employer from later
denying the combined or consequential condition if the otherwise
compensable injury ceases to be the major contributing cause of
the combined or consequential condition.
  (d) An injured worker who believes that a condition has been
incorrectly omitted from a notice of acceptance, or that the
notice is otherwise deficient, first must communicate in writing
to the insurer or self-insured employer the worker's objections
to the notice pursuant to ORS 656.267. The insurer or
self-insured employer has   { - 60 - }  { +  90 + } days from
receipt of the communication from the worker to revise the notice
or to make other written clarification in response. A worker who
fails to comply with the communication requirements of this
paragraph or ORS 656.267 may not allege at any hearing or other
proceeding on the claim a de facto denial of a condition based on
information in the notice of acceptance from the insurer or
self-insured employer.  Notwithstanding any other provision of
this chapter, the worker may initiate objection to the notice of
acceptance at any time.
  (7)(a) After claim acceptance, written notice of acceptance or
denial of claims for aggravation or new medical or omitted
condition claims properly initiated pursuant to ORS 656.267 shall
be furnished to the claimant by the insurer or self-insured
employer within   { - 60 - }   { + 90 + } days after the insurer
or self-insured employer receives written notice of such claims.
A worker who fails to comply with the communication requirements
of subsection (6) of this section or ORS 656.267 may not allege
at any hearing or other proceeding on the claim a de facto denial
of a condition based on information in the notice of acceptance
from the insurer or self-insured employer.
  (b) Once a worker's claim has been accepted, the insurer or
self-insured employer must issue a written denial to the worker
when the accepted injury is no longer the major contributing
cause of the worker's combined condition before the claim may be
closed.
  (c) When an insurer or self-insured employer determines that
the claim qualifies for claim closure, the insurer or
self-insured employer shall issue at claim closure an updated
notice of acceptance that specifies which conditions are
compensable. The procedures specified in subsection (6)(d) of
this section apply to this notice. Any objection to the updated
notice or appeal of denied conditions shall not delay claim
closure pursuant to ORS 656.268. If a condition is found
compensable after claim closure, the insurer or self-insured
employer shall reopen the claim for processing regarding that
condition.
  (8) The assigned claims agent in processing claims under ORS
656.054 shall send notice of acceptance or denial to the
noncomplying employer.
  (9) If an insurer or any other duly authorized agent of the
employer for such purpose, on record with the Director of the
Department of Consumer and Business Services denies a claim for
compensation, written notice of such denial, stating the reason
for the denial, and informing the worker of the Expedited Claim
Service and of hearing rights under ORS 656.283, shall be given
to the claimant. A copy of the notice of denial shall be mailed
to the director and to the employer by the insurer. The worker
may request a hearing pursuant to ORS 656.319.
  (10) Merely paying or providing compensation shall not be
considered acceptance of a claim or an admission of liability,
nor shall mere acceptance of such compensation be considered a
waiver of the right to question the amount thereof. Payment of
permanent disability benefits pursuant to a notice of closure,
reconsideration order or litigation order, or the failure to
appeal or seek review of such an order or notice of closure,
shall not preclude an insurer or self-insured employer from
subsequently contesting the compensability of the condition rated
therein, unless the condition has been formally accepted.
  (11)(a) If the insurer or self-insured employer unreasonably
delays or unreasonably refuses to pay compensation, or
unreasonably delays acceptance or denial of a claim, the insurer
or self-insured employer shall be liable for an additional amount
up to 25 percent of the amounts then due plus any attorney fees
assessed under this section. The fees assessed by the director,
an Administrative Law Judge, the board or the court under this
section shall be proportionate to the benefit to the injured
worker. The board shall adopt rules for establishing the amount
of the attorney fee, giving primary consideration to the results
achieved and to the time devoted to the case. An attorney fee
awarded pursuant to this subsection may not exceed $2,000 absent
a showing of extraordinary circumstances. Notwithstanding any
other provision of this chapter, the director shall have
exclusive jurisdiction over proceedings regarding solely the
assessment and payment of the additional amount and attorney fees
described in this subsection. The action of the director and the
review of the action taken by the director shall be subject to
review under ORS 656.704.
  (b) When the director does not have exclusive jurisdiction over
proceedings regarding the assessment and payment of the
additional amount and attorney fees described in this subsection,
the provisions of this subsection shall apply in the other
proceeding.
  (12) The insurer may authorize an employer to pay compensation
to injured workers and shall reimburse employers for compensation
so paid.
  (13) Injured workers have the duty to cooperate and assist the
insurer or self-insured employer in the investigation of claims
for compensation. Injured workers shall submit to and shall fully
cooperate with personal and telephonic interviews and other
formal or informal information gathering techniques. Injured
workers who are represented by an attorney shall have the right
to have the attorney present during any personal or telephonic
interview or deposition. However, if the attorney is not willing
or available to participate in an interview at a time reasonably
chosen by the insurer or self-insured employer within 14 days of
the request for interview and the insurer or self-insured
employer has cause to believe that the attorney's unwillingness
or unavailability is unreasonable and is preventing the worker
from complying within 14 days of the request for interview, the
insurer or self-insured employer shall notify the director. If
the director determines that the attorney's unwillingness or
unavailability is unreasonable, the director shall assess a civil
penalty against the attorney of not more than $1,000.
  (14) If the director finds that a worker fails to reasonably
cooperate with an investigation involving an initial claim to
establish a compensable injury or an aggravation claim to reopen
the claim for a worsened condition, the director shall suspend
all or part of the payment of compensation after notice to the
worker.  If the worker does not cooperate for an additional 30
days after the notice, the insurer or self-insured employer may
deny the claim because of the worker's failure to cooperate. The
obligation of the insurer or self-insured employer to accept or
deny the claim within   { - 60 - }   { + 90 + } days is suspended
during the time of the worker's noncooperation. After such a
denial, the worker shall not be granted a hearing or other
proceeding under this chapter on the merits of the claim unless
the worker first requests and establishes at an expedited hearing
under ORS 656.291 that the worker fully and completely cooperated
with the investigation, that the worker failed to cooperate for
reasons beyond the worker's control or that the investigative
demands were unreasonable. If the Administrative Law Judge finds
that the worker has not fully cooperated, the Administrative Law
Judge shall affirm the denial, and the worker's claim for injury
shall remain denied. If the Administrative Law Judge finds that
the worker has cooperated, or that the investigative demands were
unreasonable, the Administrative Law Judge shall set aside the
denial, order the reinstatement of interim compensation if
appropriate and remand the claim to the insurer or self-insured
employer to accept or deny the claim.
  (15) In accordance with ORS 656.283 (4), the Administrative Law
Judge assigned a request for hearing for a claim for compensation
involving more than one potentially responsible employer or
insurer may specify what is required of an injured worker to
reasonably cooperate with the investigation of the claim as
required by subsection (13) of this section.
  SECTION 2. ORS 656.262, as amended by section 10, chapter 811,
Oregon Laws 2003, section 10, chapter 26, Oregon Laws 2005,
section 2, chapter 511, Oregon Laws 2005, and section 3, chapter
588, Oregon Laws 2005, is amended to read:
  656.262. (1) Processing of claims and providing compensation
for a worker shall be the responsibility of the insurer or
self-insured employer. All employers shall assist their insurers
in processing claims as required in this chapter.
  (2) The compensation due under this chapter shall be paid
periodically, promptly and directly to the person entitled
thereto upon the employer's receiving notice or knowledge of a
claim, except where the right to compensation is denied by the
insurer or self-insured employer.
  (3)(a) Employers shall, immediately and not later than five
days after notice or knowledge of any claims or accidents which
may result in a compensable injury claim, report the same to
their insurer. The report shall include:
  (A) The date, time, cause and nature of the accident and
injuries.
  (B) Whether the accident arose out of and in the course of
employment.
  (C) Whether the employer recommends or opposes acceptance of
the claim, and the reasons therefor.
  (D) The name and address of any health insurance provider for
the injured worker.
  (E) Any other details the insurer may require.
  (b) Failure to so report subjects the offending employer to a
charge for reimbursing the insurer for any penalty the insurer is
required to pay under subsection (11) of this section because of
such failure. As used in this subsection, 'health insurance' has
the meaning for that term provided in ORS 731.162.
  (4)(a) The first installment of temporary disability
compensation shall be paid no later than the 14th day after the
subject employer has notice or knowledge of the claim, if the
attending physician authorizes the payment of temporary
disability compensation. Thereafter, temporary disability
compensation shall be paid at least once each two weeks, except
where the Director of the Department of Consumer and Business
Services determines that payment in installments should be made
at some other interval. The director may by rule convert monthly
benefit schedules to weekly or other periodic schedules.
  (b) Notwithstanding any other provision of this chapter, if a
self-insured employer pays to an injured worker who becomes
disabled the same wage at the same pay interval that the worker
received at the time of injury, such payment shall be deemed
timely payment of temporary disability payments pursuant to ORS
656.210 and 656.212 during the time the wage payments are made.
  (c) Notwithstanding any other provision of this chapter, when
the holder of a public office is injured in the course and scope
of that public office, full official salary paid to the holder of
that public office shall be deemed timely payment of temporary
disability payments pursuant to ORS 656.210 and 656.212 during
the time the wage payments are made. As used in this subsection,
' public office' has the meaning for that term provided in ORS
260.005.
  (d) Temporary disability compensation is not due and payable
for any period of time for which the insurer or self-insured
employer has requested from the worker's attending physician
verification of the worker's inability to work resulting from the
claimed injury or disease and the physician cannot verify the
worker's inability to work, unless the worker has been unable to
receive treatment for reasons beyond the worker's control.
  (e) If a worker fails to appear at an appointment with the
worker's attending physician, the insurer or self-insured
employer shall notify the worker by certified mail that temporary
disability benefits may be suspended after the worker fails to
appear at a rescheduled appointment. If the worker fails to
appear at a rescheduled appointment, the insurer or self-insured
employer may suspend payment of temporary disability benefits to
the worker until the worker appears at a subsequent rescheduled
appointment.
  (f) If the insurer or self-insured employer has requested and
failed to receive from the worker's attending physician
verification of the worker's inability to work resulting from the
claimed injury or disease, medical services provided by the
attending physician are not compensable until the attending
physician submits such verification.
  (g) Temporary disability compensation is not due and payable
pursuant to ORS 656.268 after the worker's attending physician
ceases to authorize temporary disability or for any period of
time not authorized by the attending physician. No authorization
of temporary disability compensation by the attending physician
under ORS 656.268 shall be effective to retroactively authorize
the payment of temporary disability more than 14 days prior to
its issuance.
  (h) The worker's disability may be authorized only by a person
described in ORS 656.005 (12)(b)(B) or 656.245 (5) for the period
of time permitted by those sections. The insurer or self-insured
employer may unilaterally suspend payment of temporary disability
benefits to the worker at the expiration of the period until
temporary disability is reauthorized by an attending physician.
  (i) The insurer or self-insured employer may unilaterally
suspend payment of all compensation to a worker enrolled in a
managed care organization if the worker continues to seek care
from an attending physician that is not authorized by the managed
care organization more than seven days after the mailing of
notice by the insurer or self-insured employer.
  (5) Payment of compensation under subsection (4) of this
section or payment, in amounts not to exceed $1,500 per claim,
for medical services for nondisabling claims, may be made by the
subject employer if the employer so chooses. The making of such
payments does not constitute a waiver or transfer of the
insurer's duty to determine entitlement to benefits. If the
employer chooses to make such payment, the employer shall report
the injury to the insurer in the same manner that other injuries
are reported.  However, an insurer shall not modify an employer's
experience rating or otherwise make charges against the employer
for any medical expenses paid by the employer pursuant to this
subsection.
  (6)(a) Written notice of acceptance or denial of the claim
shall be furnished to the claimant by the insurer or self-insured
employer within   { - 60 - }   { + 90 + } days after the employer
has notice or knowledge of the claim. Once the claim is accepted,
the insurer or self-insured employer shall not revoke acceptance
except as provided in this section. The insurer or self-insured
employer may revoke acceptance and issue a denial at any time
when the denial is for fraud, misrepresentation or other illegal
activity by the worker. If the worker requests a hearing on any
revocation of acceptance and denial alleging fraud,
misrepresentation or other illegal activity, the insurer or
self-insured employer has the burden of proving, by a
preponderance of the evidence, such fraud, misrepresentation or
other illegal activity. Upon such proof, the worker then has the
burden of proving, by a preponderance of the evidence, the
compensability of the claim. If the insurer or self-insured
employer accepts a claim in good faith, in a case not involving
fraud, misrepresentation or other illegal activity by the worker,
and later obtains evidence that the claim is not compensable or
evidence that the insurer or self-insured employer is not
responsible for the claim, the insurer or self-insured employer
may revoke the claim acceptance and issue a formal notice of
claim denial, if such revocation of acceptance and denial is
issued no later than two years after the date of the initial
acceptance. If the worker requests a hearing on such revocation
of acceptance and denial, the insurer or self-insured employer
must prove, by a preponderance of the evidence, that the claim is
not compensable or that the insurer or self-insured employer is
not responsible for the claim. Notwithstanding any other
provision of this chapter, if a denial of a previously accepted
claim is set aside by an Administrative Law Judge, the Workers'
Compensation Board or the court, temporary total disability
benefits are payable from the date any such benefits were
terminated under the denial. Except as provided in ORS 656.247,
pending acceptance or denial of a claim, compensation payable to
a claimant does not include the costs of medical benefits or
burial expenses. The insurer shall also furnish the employer a
copy of the notice of acceptance.
  (b) The notice of acceptance shall:
  (A) Specify what conditions are compensable.
  (B) Advise the claimant whether the claim is considered
disabling or nondisabling.
  (C) Inform the claimant of the Expedited Claim Service and of
the hearing and aggravation rights concerning nondisabling
injuries, including the right to object to a decision that the
injury of the claimant is nondisabling by requesting
reclassification pursuant to ORS 656.277.
  (D) Inform the claimant of employment reinstatement rights and
responsibilities under ORS chapter 659A.
  (E) Inform the claimant of assistance available to employers
and workers from the Reemployment Assistance Program under ORS
656.622.
  (F) Be modified by the insurer or self-insured employer from
time to time as medical or other information changes a previously
issued notice of acceptance.
  (c) An insurer's or self-insured employer's acceptance of a
combined or consequential condition under ORS 656.005 (7),
whether voluntary or as a result of a judgment or order, shall
not preclude the insurer or self-insured employer from later
denying the combined or consequential condition if the otherwise
compensable injury ceases to be the major contributing cause of
the combined or consequential condition.
  (d) An injured worker who believes that a condition has been
incorrectly omitted from a notice of acceptance, or that the
notice is otherwise deficient, first must communicate in writing
to the insurer or self-insured employer the worker's objections
to the notice pursuant to ORS 656.267. The insurer or
self-insured employer has   { - 60 - }   { + 90 + } days from
receipt of the communication from the worker to revise the notice
or to make other written clarification in response. A worker who
fails to comply with the communication requirements of this
paragraph or ORS 656.267 may not allege at any hearing or other
proceeding on the claim a de facto denial of a condition based on
information in the notice of acceptance from the insurer or
self-insured employer.  Notwithstanding any other provision of
this chapter, the worker may initiate objection to the notice of
acceptance at any time.
  (7)(a) After claim acceptance, written notice of acceptance or
denial of claims for aggravation or new medical or omitted
condition claims properly initiated pursuant to ORS 656.267 shall
be furnished to the claimant by the insurer or self-insured
employer within   { - 60 - }   { + 90 + } days after the insurer
or self-insured employer receives written notice of such claims.
A worker who fails to comply with the communication requirements
of subsection (6) of this section or ORS 656.267 may not allege
at any hearing or other proceeding on the claim a de facto denial
of a condition based on information in the notice of acceptance
from the insurer or self-insured employer.
  (b) Once a worker's claim has been accepted, the insurer or
self-insured employer must issue a written denial to the worker
when the accepted injury is no longer the major contributing
cause of the worker's combined condition before the claim may be
closed.
  (c) When an insurer or self-insured employer determines that
the claim qualifies for claim closure, the insurer or
self-insured employer shall issue at claim closure an updated
notice of acceptance that specifies which conditions are
compensable. The procedures specified in subsection (6)(d) of
this section apply to this notice. Any objection to the updated
notice or appeal of denied conditions shall not delay claim
closure pursuant to ORS 656.268. If a condition is found
compensable after claim closure, the insurer or self-insured
employer shall reopen the claim for processing regarding that
condition.
  (8) The assigned claims agent in processing claims under ORS
656.054 shall send notice of acceptance or denial to the
noncomplying employer.
  (9) If an insurer or any other duly authorized agent of the
employer for such purpose, on record with the Director of the
Department of Consumer and Business Services denies a claim for
compensation, written notice of such denial, stating the reason
for the denial, and informing the worker of the Expedited Claim
Service and of hearing rights under ORS 656.283, shall be given
to the claimant. A copy of the notice of denial shall be mailed
to the director and to the employer by the insurer. The worker
may request a hearing pursuant to ORS 656.319.
  (10) Merely paying or providing compensation shall not be
considered acceptance of a claim or an admission of liability,
nor shall mere acceptance of such compensation be considered a
waiver of the right to question the amount thereof. Payment of
permanent disability benefits pursuant to a notice of closure,
reconsideration order or litigation order, or the failure to
appeal or seek review of such an order or notice of closure,
shall not preclude an insurer or self-insured employer from
subsequently contesting the compensability of the condition rated
therein, unless the condition has been formally accepted.
  (11)(a) If the insurer or self-insured employer unreasonably
delays or unreasonably refuses to pay compensation, or
unreasonably delays acceptance or denial of a claim, the insurer
or self-insured employer shall be liable for an additional amount
up to 25 percent of the amounts then due plus any attorney fees
assessed under this section. The fees assessed by the director,
an Administrative Law Judge, the board or the court under this
section shall be proportionate to the benefit to the injured
worker. The board shall adopt rules for establishing the amount
of the attorney fee, giving primary consideration to the results
achieved and to the time devoted to the case. An attorney fee
awarded pursuant to this subsection may not exceed $2,000 absent
a showing of extraordinary circumstances. Notwithstanding any
other provision of this chapter, the director shall have
exclusive jurisdiction over proceedings regarding solely the
assessment and payment of the additional amount and attorney fees
described in this subsection. The action of the director and the
review of the action taken by the director shall be subject to
review under ORS 656.704.
  (b) When the director does not have exclusive jurisdiction over
proceedings regarding the assessment and payment of the
additional amount and attorney fees described in this subsection,
the provisions of this subsection shall apply in the other
proceeding.
  (12) The insurer may authorize an employer to pay compensation
to injured workers and shall reimburse employers for compensation
so paid.
  (13) Injured workers have the duty to cooperate and assist the
insurer or self-insured employer in the investigation of claims
for compensation. Injured workers shall submit to and shall fully
cooperate with personal and telephonic interviews and other
formal or informal information gathering techniques. Injured
workers who are represented by an attorney shall have the right
to have the attorney present during any personal or telephonic
interview or deposition. However, if the attorney is not willing
or available to participate in an interview at a time reasonably
chosen by the insurer or self-insured employer within 14 days of
the request for interview and the insurer or self-insured
employer has cause to believe that the attorney's unwillingness
or unavailability is unreasonable and is preventing the worker
from complying within 14 days of the request for interview, the
insurer or self-insured employer shall notify the director. If
the director determines that the attorney's unwillingness or
unavailability is unreasonable, the director shall assess a civil
penalty against the attorney of not more than $1,000.
  (14) If the director finds that a worker fails to reasonably
cooperate with an investigation involving an initial claim to
establish a compensable injury or an aggravation claim to reopen
the claim for a worsened condition, the director shall suspend
all or part of the payment of compensation after notice to the
worker.  If the worker does not cooperate for an additional 30
days after the notice, the insurer or self-insured employer may
deny the claim because of the worker's failure to cooperate. The
obligation of the insurer or self-insured employer to accept or
deny the claim within   { - 60 - }   { + 90 + } days is suspended
during the time of the worker's noncooperation. After such a
denial, the worker shall not be granted a hearing or other
proceeding under this chapter on the merits of the claim unless
the worker first requests and establishes at an expedited hearing
under ORS 656.291 that the worker fully and completely cooperated
with the investigation, that the worker failed to cooperate for
reasons beyond the worker's control or that the investigative
demands were unreasonable. If the Administrative Law Judge finds
that the worker has not fully cooperated, the Administrative Law
Judge shall affirm the denial, and the worker's claim for injury
shall remain denied. If the Administrative Law Judge finds that
the worker has cooperated, or that the investigative demands were
unreasonable, the Administrative Law Judge shall set aside the
denial, order the reinstatement of interim compensation if
appropriate and remand the claim to the insurer or self-insured
employer to accept or deny the claim.
  (15) In accordance with ORS 656.283 (4), the Administrative Law
Judge assigned a request for hearing for a claim for compensation
involving more than one potentially responsible employer or
insurer may specify what is required of an injured worker to
reasonably cooperate with the investigation of the claim as
required by subsection (13) of this section.
  SECTION 3. ORS 656.308 is amended to read:
  656.308. (1) When a worker sustains a compensable injury, the
responsible employer shall remain responsible for future
compensable medical services and disability relating to the
compensable condition unless the worker sustains a new
compensable injury involving the same condition. If a new
compensable injury occurs, all further compensable medical
services and disability involving the same condition shall be
processed as a new injury claim by the subsequent employer. The
standards for determining the compensability of a combined
condition under ORS 656.005 (7) shall also be used to determine
the occurrence of a new compensable injury or disease under this
section.
  (2)(a) Any insurer or self-insured employer who disputes
responsibility for a claim shall so indicate in or as part of a
denial otherwise meeting the requirements of ORS 656.262 issued
in the   { - 60 - }   { + 90 + } days allowed for processing of
the claim. The denial shall advise the worker to file separate,
timely claims against other potentially responsible insurers or
self-insured employers, including other insurers for the same
employer, in order to protect the right to obtain benefits on the
claim. The denial may list the names and addresses of other
insurers or self-insured employers. Such denials shall be final
unless the worker files a timely request for hearing pursuant to
ORS 656.319. All such requests for hearing shall be consolidated
into one proceeding.
  (b) No insurer or self-insured employer, including other
insurers for the same employer, shall be joined to any workers'
compensation hearing unless the worker has first filed a timely,
written claim against that insurer or self-insured employer, or
the insurer or self-insured employer has consented to issuance of
an order designating a paying agent pursuant to ORS 656.307. An
insurer or self-insured employer against whom a claim is filed
may contend that responsibility lies with another insurer or
self-insured employer, including another insurer for the same
employer, regardless of whether the worker has filed a claim
against that insurer or self-insured employer.
  (c) Upon written notice by an insurer or self-insured employer
filed not more than 28 days or less than 14 days before the
hearing, the Administrative Law Judge shall dismiss that party
from the proceeding if the record does not contain substantial
evidence to support a finding of responsibility against that
party. The Administrative Law Judge shall decide such motions and
inform the parties not less than seven days prior to the hearing,
or postpone the hearing.
  (d) Notwithstanding ORS 656.382 (2), 656.386 and 656.388, a
reasonable attorney fee shall be awarded to the injured worker
for the appearance and active and meaningful participation by an
attorney in finally prevailing against a responsibility denial.
Such a fee shall not exceed $1,000 absent a showing of
extraordinary circumstances.
  (3) A worker who is a party to an approved disputed claim
settlement agreement under ORS 656.289 (4) may not subsequently
file a claim against an insurer or a self-insured employer who is
a party to the agreement with regard to claim conditions settled
in the agreement even if other insurers or employers disclaim
responsibility for those claim conditions. A worker who is a
party to an approved claim disposition agreement under ORS
656.236 (1) may not subsequently file a claim against an insurer
or a self-insured employer who is a party to the agreement with
regard to any matter settled in the agreement even if other
insurers or employers disclaim responsibility for those claim
conditions, unless the claim in the subsequent proceeding is
limited to a claim for medical services for claim conditions
settled in the agreement.
  SECTION 4. ORS 656.325 is amended to read:
  656.325. (1)(a) Any worker entitled to receive compensation
under this chapter is required, if requested by the Director of
the Department of Consumer and Business Services, the insurer or
self-insured employer, to submit to a medical examination at a
time reasonably convenient for the worker as may be provided by
the rules of the director. No more than three independent medical
examinations may be requested except after notification to and
authorization by the director. If the worker refuses to submit to
any such examination, or obstructs the same, the rights of the
worker to compensation shall be suspended with the consent of the
director until the examination has taken place, and no
compensation shall be payable during or for account of such
period. The provisions of this paragraph are subject to the
limitations on medical examinations provided in ORS 656.268.
  (b) When a worker is requested by the director, the insurer or
self-insured employer to attend an independent medical
examination, the examination must be conducted by a physician
selected from a list of qualified physicians established by the
director under ORS 656.328.
  (c) The director shall adopt rules applicable to independent
medical examinations conducted pursuant to paragraph (a) of this
subsection that:
  (A) Provide a worker the opportunity to request review by the
director of the reasonableness of the location selected for an
independent medical examination. Upon receipt of the request for
review, the director shall conduct an expedited review of the
location selected for the independent medical examination and
issue an order on the reasonableness of the location of the
examination. The director shall determine if there is substantial
evidence for the objection to the location for the independent
medical examination based on a conclusion that the required
travel is medically contraindicated or other good cause
establishing that the required travel is unreasonable. The
determinations of the director about the location of independent
medical examinations are not subject to review.
  (B) Impose a monetary penalty against a worker who fails to
attend an independent medical examination without prior
notification or without justification for not attending the
examination. A penalty imposed under this subparagraph may be
imposed only on a worker who is not receiving temporary
disability benefits under ORS 656.210 or 656.212. An insurer or
self-insured employer may offset any future compensation payable
to the worker to recover any penalty imposed under this
subparagraph from a claim with the same insurer or self-insured
employer. When a penalty is recovered from temporary disability
or permanent total disability benefits, the amount recovered from
each payment may not exceed 25 percent of the benefit payment
without prior authorization from the worker.
  (C) Impose a sanction against a medical service provider that
unreasonably fails to provide in a timely manner diagnostic
records required for an independent medical examination.
  (d)   { - Notwithstanding ORS 656.262 (6), - }  If the director
determines that the location selected for an independent medical
examination is unreasonable, the insurer or self-insured employer
shall accept or deny the claim within 90 days after the employer
has notice or knowledge of the claim.
 
  (e) If the worker has made a timely request for a hearing on a
denial of compensability as required by ORS 656.319 (1)(a) that
is based on one or more reports of examinations conducted
pursuant to paragraph (a) of this subsection and the worker's
attending physician or nurse practitioner authorized to provide
compensable medical services under ORS 656.245 does not concur
with the report or reports, the worker may request an examination
to be conducted by a physician selected by the director from the
list described in ORS 656.328. The cost of the examination and
the examination report shall be paid by the insurer or
self-insured employer.
  (f) The insurer or self-insured employer shall pay the costs of
the medical examination and related services which are reasonably
necessary to allow the worker to submit to any examination
requested under this section. As used in this paragraph, 'related
services' includes, but is not limited to, child care, travel,
meals, lodging and an amount equivalent to the worker's net lost
wages for the period during which the worker is absent if the
worker does not receive benefits pursuant to ORS 656.210 (4)
during the period of absence. A claim for 'related services'
described in this paragraph shall be made in the manner
prescribed by the director.
  (g) A worker who objects to the location of an independent
medical examination must request review by the director under
paragraph (c)(A) of this subsection within six business days of
the date the notice of the independent medical examination was
mailed.
  (2) For any period of time during which any worker commits
insanitary or injurious practices which tend to either imperil or
retard recovery of the worker, or refuses to submit to such
medical or surgical treatment as is reasonably essential to
promote recovery, or fails to participate in a program of
physical rehabilitation, the right of the worker to compensation
shall be suspended with the consent of the director and no
payment shall be made for such period. The period during which
such worker would otherwise be entitled to compensation may be
reduced with the consent of the director to such an extent as the
disability has been increased by such refusal.
  (3) A worker who has received an award for permanent total or
permanent partial disability should be encouraged to make a
reasonable effort to reduce the disability; and the award shall
be subject to periodic examination and adjustment in conformity
with ORS 656.268.
  (4) When the employer of an injured worker, or the employer's
insurer determines that the injured worker has failed to follow
medical advice from the attending physician or nurse practitioner
authorized to provide compensable medical services under ORS
656.245 or has failed to participate in or complete physical
restoration or vocational rehabilitation programs prescribed for
the worker pursuant to this chapter, the employer or insurer may
petition the director for reduction of any benefits awarded the
worker. Notwithstanding any other provision of this chapter, if
the director finds that the worker has failed to accept treatment
as provided in this subsection, the director may reduce any
benefits awarded the worker by such amount as the director
considers appropriate.
  (5)(a) Except as provided by ORS 656.268 (4)(c) and (10), an
insurer or self-insured employer shall cease making payments
pursuant to ORS 656.210 and shall commence making payment of such
amounts as are due pursuant to ORS 656.212 when an injured worker
refuses wage earning employment prior to claim determination and
the worker's attending physician or nurse practitioner authorized
to provide compensable medical services under ORS 656.245, after
being notified by the employer of the specific duties to be
performed by the injured worker, agrees that the injured worker
is capable of performing the employment offered.
  (b) If the worker has been terminated for violation of work
rules or other disciplinary reasons, the insurer or self-insured
employer shall cease payments pursuant to ORS 656.210 and
commence payments pursuant to ORS 656.212 when the attending
physician or nurse practitioner authorized to provide compensable
medical services under ORS 656.245 approves employment in a
modified job that would have been offered to the worker if the
worker had remained employed, provided that the employer has a
written policy of offering modified work to injured workers.
  (c) If the worker is a person present in the United States in
violation of federal immigration laws, the insurer or
self-insured employer shall cease payments pursuant to ORS
656.210 and commence payments pursuant to ORS 656.212 when the
attending physician or nurse practitioner authorized to provide
compensable medical services under ORS 656.245 approves
employment in a modified job whether or not such a job is
available.
  (6) Any party may request a hearing on any dispute under this
section pursuant to ORS 656.283.
  SECTION 5. ORS 656.325, as amended by section 12, chapter 657,
Oregon Laws 2003, section 14, chapter 811, Oregon Laws 2003, and
section 2, chapter 675, Oregon Laws 2005, is amended to read:
  656.325. (1)(a) Any worker entitled to receive compensation
under this chapter is required, if requested by the Director of
the Department of Consumer and Business Services, the insurer or
self-insured employer, to submit to a medical examination at a
time reasonably convenient for the worker as may be provided by
the rules of the director. No more than three independent medical
examinations may be requested except after notification to and
authorization by the director. If the worker refuses to submit to
any such examination, or obstructs the same, the rights of the
worker to compensation shall be suspended with the consent of the
director until the examination has taken place, and no
compensation shall be payable during or for account of such
period. The provisions of this paragraph are subject to the
limitations on medical examinations provided in ORS 656.268.
  (b) When a worker is requested by the director, the insurer or
self-insured employer to attend an independent medical
examination, the examination must be conducted by a physician
selected from a list of qualified physicians established by the
director under ORS 656.328.
  (c) The director shall adopt rules applicable to independent
medical examinations conducted pursuant to paragraph (a) of this
subsection that:
  (A) Provide a worker the opportunity to request review by the
director of the reasonableness of the location selected for an
independent examination. Upon receipt of the request for review,
the director shall conduct an expedited review of the location
selected for the independent medical examination and issue an
order on the reasonableness of the location of the examination.
The director shall determine if there is substantial evidence for
the objection to the location for the independent medical
examination based on a conclusion that the required travel is
medically contraindicated or other good cause establishing that
the required travel is unreasonable. The determinations of the
director about the location of independent medical examinations
are not subject to review.
  (B) Impose a monetary penalty against a worker who fails to
attend an independent medical examination without prior
notification or without justification for not attending the
examination. A penalty imposed under this subparagraph may be
imposed only on a worker who is not receiving temporary
disability benefits under ORS 656.210 or 656.212. An insurer or
self-insured employer may offset any future compensation payable
to the worker to recover any penalty imposed under this
subparagraph from a claim with the same insurer or self-insured
employer. When a penalty is recovered from temporary disability
or permanent total disability benefits, the amount recovered from
each payment may not exceed 25 percent of the benefit payment
without prior authorization from the worker.
  (C) Impose a sanction against a medical service provider that
unreasonably fails to provide in a timely manner diagnostic
records required for an independent medical examination.
  (d)   { - Notwithstanding ORS 656.262 (6), - }  If the director
determines that the location selected for an independent medical
examination is unreasonable, the insurer or self-insured employer
shall accept or deny the claim within 90 days after the employer
has notice or knowledge of the claim.
  (e) If the worker has made a timely request for a hearing on a
denial of compensability as required by ORS 656.319 (1)(a) that
is based on one or more reports of examinations conducted
pursuant to paragraph (a) of this subsection and the worker's
attending physician does not concur with the report or reports,
the worker may request an examination to be conducted by a
physician selected by the director from the list described in ORS
656.328. The cost of the examination and the examination report
shall be paid by the insurer or self-insured employer.
  (f) The insurer or self-insured employer shall pay the costs of
the medical examination and related services which are reasonably
necessary to allow the worker to submit to any examination
requested under this section. As used in this paragraph, 'related
services' includes, but is not limited to, child care, travel,
meals, lodging and an amount equivalent to the worker's net lost
wages for the period during which the worker is absent if the
worker does not receive benefits pursuant to ORS 656.210 (4)
during the period of absence. A claim for 'related services'
described in this paragraph shall be made in the manner
prescribed by the director.
  (g) A worker who objects to the location of an independent
medical examination must request review by the director under
paragraph (c)(A) of this subsection within six business days of
the date the notice of the independent medical examination was
mailed.
  (2) For any period of time during which any worker commits
insanitary or injurious practices which tend to either imperil or
retard recovery of the worker, or refuses to submit to such
medical or surgical treatment as is reasonably essential to
promote recovery, or fails to participate in a program of
physical rehabilitation, the right of the worker to compensation
shall be suspended with the consent of the director and no
payment shall be made for such period. The period during which
such worker would otherwise be entitled to compensation may be
reduced with the consent of the director to such an extent as the
disability has been increased by such refusal.
  (3) A worker who has received an award for unscheduled
permanent total or unscheduled partial disability should be
encouraged to make a reasonable effort to reduce the disability;
and the award shall be subject to periodic examination and
adjustment in conformity with ORS 656.268.
  (4) When the employer of an injured worker, or the employer's
insurer determines that the injured worker has failed to follow
medical advice from the attending physician or has failed to
participate in or complete physical restoration or vocational
rehabilitation programs prescribed for the worker pursuant to
this chapter, the employer or insurer may petition the director
for reduction of any benefits awarded the worker. Notwithstanding
any other provision of this chapter, if the director finds that
the worker has failed to accept treatment as provided in this
subsection, the director may reduce any benefits awarded the
worker by such amount as the director considers appropriate.
  (5)(a) Except as provided by ORS 656.268 (4)(c) and (10), an
insurer or self-insured employer shall cease making payments
pursuant to ORS 656.210 and shall commence making payment of such
amounts as are due pursuant to ORS 656.212 when an injured worker
refuses wage earning employment prior to claim determination and
the worker's attending physician, after being notified by the
employer of the specific duties to be performed by the injured
worker, agrees that the injured worker is capable of performing
the employment offered.
  (b) If the worker has been terminated for violation of work
rules or other disciplinary reasons, the insurer or self-insured
employer shall cease payments pursuant to ORS 656.210 and
commence payments pursuant to ORS 656.212 when the attending
physician approves employment in a modified job that would have
been offered to the worker if the worker had remained employed,
provided that the employer has a written policy of offering
modified work to injured workers.
  (c) If the worker is a person present in the United States in
violation of federal immigration laws, the insurer or
self-insured employer shall cease payments pursuant to ORS
656.210 and commence payments pursuant to ORS 656.212 when the
attending physician approves employment in a modified job whether
or not such a job is available.
  (6) Any party may request a hearing on any dispute under this
section pursuant to ORS 656.283.
  SECTION 6. ORS 656.386 is amended to read:
  656.386. (1)(a) In all cases involving denied claims where a
claimant finally prevails against the denial in an appeal to the
Court of Appeals or petition for review to the Supreme Court, the
court shall allow a reasonable attorney fee to the claimant's
attorney. In such cases involving denied claims where the
claimant prevails finally in a hearing before an Administrative
Law Judge or in a review by the Workers' Compensation Board, then
the Administrative Law Judge or board shall allow a reasonable
attorney fee. In such cases involving denied claims where an
attorney is instrumental in obtaining a rescission of the denial
prior to a decision by the Administrative Law Judge, a reasonable
attorney fee shall be allowed.
  (b) For purposes of this section, a 'denied claim' is:
  (A) A claim for compensation which an insurer or self-insured
employer refuses to pay on the express ground that the injury or
condition for which compensation is claimed is not compensable or
otherwise does not give rise to an entitlement to any
compensation;
  (B) A claim for compensation for a condition omitted from a
notice of acceptance, made pursuant to ORS 656.262 (6)(d), which
the insurer or self-insured employer does not respond to within
  { - 60 - }  { +  90 + } days; or
  (C) A claim for an aggravation made pursuant to ORS 656.273 (2)
or for a new medical condition made pursuant to ORS 656.267,
which the insurer or self-insured employer does not respond to
within   { - 60 - }   { + 90 + } days.
  (c) A denied claim shall not be presumed or implied from an
insurer's or self-insured employer's failure to pay compensation
for a previously accepted injury or condition in timely fashion.
Attorney fees provided for in this subsection shall be paid by
the insurer or self-insured employer.
  (2) In all other cases, attorney fees shall be paid from the
increase in the claimant's compensation, if any, except as
otherwise expressly provided in this chapter.
  SECTION 7.  { + The amendments to + }  { + ORS 656.262,
656.308, 656.325 and 656.386 by sections 1, 2, 3, 4, 5 and 6 of
this 2007 Act apply to any claim with a date of acceptance or
denial on or after January 1, 2008. + }
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