Salem, OR – Oregon’s Division of Workers’ Compensation recently issued the following notice, which provides information about changes to Oregon Administrative Rule (OAR) 436-050, Employer/Insurer Coverage Responsibility that were effective Jan. 1, 2013. Insurers, particularly those that use service companies (third-party administrators) in Oregon, need to be aware of several important requirements in the amended rules.
Under OAR 436-050-0110(1), insurance companies must register with the division and provide notice of their contact information and processing locations in Oregon. The rule now specifies that the contact information the insurer provides must reasonably lead the caller to a person who can respond to inquiries related to policy, claims filing, and claims-processing location information and to access an in-state Oregon-certified claims examiner. All insurers must be able to respond timely to these types of inquiries, regardless of the policy or the service company, to help ensure that workers timely receive benefits. Also, the rule now includes the statutory limitation that an insurer may not have more than eight locations at any one time to process claims or maintain records.
If an insurer elects to use a service company in Oregon, OAR 436-050-0110(3) requires that the insurer must file a copy of the service agreement between the insurer and the service company for division approval before using the service company in Oregon. For greater clarity and transparency of the division’s service agreement review process, the rule now includes the requirements for service agreements.
A service agreement must:
- Be between the underwriting insurer and a service company that is incorporated in or authorized to do business in Oregon and must not be between any other third parties
- Identify the insurer by company name or, if multiple insurers related by ownership, by the name of the group if it includes all affiliates
- Identify the service company by name
- Grant the service company a power of attorney to act for the insurer in workers’ compensation claims proceedings under ORS chapter 656
- Contain only those provisions for workers’ compensation activities that are allowed in Oregon
Under OAR 436-050-0110(5), when an insurer changes claims processing locations, service companies, or self administration, the insurer must notify workers with open or active claims, their attorneys and attending physicians, and the director at least 10 days before the change. The rule identifies the information the insurer must include in its notice to workers and the director. Current claims processing information is essential for ensuring that workers timely receive their benefits and that the division has accurate data to respond to inquiries, perform dispute resolution, assist with return-to-work activities, and monitor industry performance.
The amended OAR 436-050 rules are available on the DCBS website at http://www.cbs.state.or.us/wcd/policy/rules/rules.html.
Failure to provide a service agreement adhering to these rules may result in civil penalties. For questions about these rule amendments or any insurer registration requirements, contact the Workers’ Compensation Division’s Insurer Registration Program at Insurerregistration.wcd@state.or.us or Susan Goode, insurer registration specialist, susan.m.goode@state.or.us, 503-947-7603.
Source: OR DCBS