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New Workers' Compensation Regulations Impact Medical Panels and Penalties

The Tennessee Department of Labor, Division of Workers' Compensation, has enacted new regulations which affect an employer's obligation to provide medical panels. The new regulations also add several potential penalties. These regulations go into effect on March 22, 2015.

With regard to medical panels, the new regulations provide that upon notice of any workplace injury, other than a minor injury for which no person could reasonably believe requires medical treatment, the employer must immediately provide the injured worker with a panel of physicians. In any case where the employer fails to provide a panel of physicians to the employee within a reasonable amount of time, but in no instance longer than five (5) business days from the date of notice of the injury, then the employer may be assessed a civil penalty not to exceed $5,000.00. Similarly, if the employer provides a panel of physicians to the injured employee that does not meet the statutory requirements on more than one (1) occasion for the same injury, this too could result in the assessment of a civil penalty not to exceed $5,000.00.

The issue of specialist referrals was also addressed by the new regulations. Under the statutory reforms effective July 1, 2014, when the treating physician makes a referral to a specific specialist, the employer shall be deemed to have accepted the referral unless the employer provides the employee with a new medical panel of appropriate specialists within three (3) business days. The new regulations clarify when the employer is considered to have received the specialist referral, thereby starting the clock to provide a specialist panel. Specifically, the regulations state that for purposes of this requirement, receipt of the referral shall be accomplished whenever a copy of the referral is received at the employer's or carrier's place of business by facsimile, email, post, hand delivery, or commercial delivery service.

The new regulations further provide that in addition to penalty referrals made by a Workers' Compensation Judge, any Division employee has the authority to refer any person or entity to the Penalty Program. The Penalty Program is responsible for investigating all referrals for civil penalties, making determinations of whether a penalty assessment is appropriate, assessing civil penalties, collecting civil penalties, and appearing at contested penalty hearings.

The Penalty Program may assess a civil penalty of between $50.00 and $5,000.00 against any person or entity for the following acts:

Failed to attend a scheduled alternative dispute resolution (ADR) proceeding;
Arrived more than thirty (30) minutes late to a scheduled ADR proceeding without previously notifying the mediator of their tardiness;
Denied or stopped providing benefits for a claim of temporary disability or medical benefits without first performing a reasonable investigation;
Provided medical providers on a panel that the party knew, should have known, or had good reason to believe, would not provide treatment for the injured employee;
Provided medical providers on a panel in an untimely manner;
Failed to comply within a reasonable amount of time with any appropriate request or directive of an ombudsman;
Failed to timely provide documents as required by the statute or regulations; or
Failed to provide a representative with authority to settle a case at an ADR proceeding.

In addition to these enumerated penalties, the new regulations also require that the Penalty Program shall assess a civil penalty of between $50.00 and $5,000.00 against a person or entity who failed to comply with any order of a Workers' Compensation Judge in a timely fashion, or who performed any act that constitutes contempt of court. In assessing the penalties described in this paragraph, no finding of bad faith is required.


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