Oklahoma Legislature Tackles Tort Reform, Workers’ Comp Issues

Elected Commissioner Not Likely to Happen This Time Around

The Oklahoma Legislature, in session from February through May, is working on a number of bills that would affect the state’s insurance industry.

Among them, a tort reform bill and a bill dealing with workers’ compensation issues have passed the House of Represen-tatives and will next be considered by the Senate. Proposals to convert the office of the insurance commissioner from an elected position to one appointed by the Governor have so far been shuttled.

Battling lawsuit abuse
The tort reform bill, a compromise version of House Bill 2661, is intended to curtail the number of lawsuits filed in Oklahoma. According to the House media division, it passed the House with little opposition but lots of amendments. Three-dozen changes were made—by Republicans and Democrats alike—to several of the 70 sections in the 166-page tort reform measure. No one debated against the bill, which passed 91-8.

Principal authors of the bill are House Speaker Larry E. Adair, D-Stilwell, and Senate President Pro Tempore Cal Hobson, D-Lexington. Much of the bill is new law, but some sections would modify existing statutes. The bill contains many provisions, some of which are:
• Attorney fees in a class-action lawsuit would be limited to no more than $500 per hour.
• Contingency fees in a lawsuit would, as a general rule, be limited to no more than 20 percent of the net judgment.
• A medical liability lawsuit could be filed “only in the county where the cause of action arose.”
• A “frivolous” lawsuit would be defined as one in which “the action or pleading was asserted in bad faith, was without merit, was not grounded in fact, or was unwarranted by existing law or a good-faith argument for the extension, modification, or reversal of existing law.”
• Courts would be empowered to reject so-called “forum shopping” by prospective litigants, by refusing to accept jurisdiction in a potential lawsuit.
• An appeal bond of a judgment would be limited to 10 percent of the net worth of the debtor or $25 million, whichever was less.
• The introduction of “junk science” in a courtroom would be barred.
• Punitive damages in a lawsuit could be awarded only if the jury hearing the case was unanimous in the decision.
• School teachers, administrators, nurses and support employees would be exempt from liability “for any act that is within the scope of the duties” of their job and “involves the exercise of judgment or discretion on the part of the employee …”

Aiming to keep jobs in state
The authors of House Bill 2619, targeting workers’ compensation reform, praised the House of Representatives for its bipartisan efforts in passing the measure.

According to the Senate communications division, Rep. Ron Peterson, R-Broken Arrow, and Sen. Scott Pruitt, R-Broken Arrow, called on Governor Brad Henry and the Senate Democrat leadership to support the legislation to save Oklahoma jobs.
HB 2619 passed on a 95 to 1 vote.

Peterson stated that the strong support of the bill “shows our commitment to address the critical need for reform and give much needed relief to employers across Oklahoma.”

The Senate announcement said the National Council on Compensation Insurance has estimated the bill would save state employers $100 million. It seeks to eliminate unnecessary litigation without decreasing benefits to employees.

According to a statement released by the House media division, the bill would trim workers’ compensation expenses in Oklahoma by a projected 7 percent to 12 percent. The Workers’ Compensation Court reportedly received 17,390 claimant filings last year and 18,474 the year before.

Among the provisions of HB 2619:
• A worker could be required to submit to drug testing after any on-the-job injury or any mishap that damages the employer’s property. The bill would eliminate the requirement that before testing can be compelled, there must be reasonable suspicion or a causal link between the accident and the alleged drug/alcohol use.
• An employer would be allowed to file a civil suit in district court against an employee who is suspected of having committed workers’ compensation fraud. Currently the only option is for the Attorney General to bring a criminal case against a fraudulent claimant.
• The legislation defines “amount in dispute” for the purpose of limiting claimants’ attorney fee awards. The phrase would mean a percentage of the amount awarded to an injured employee in excess of what the employer offered prior to trial.
• Attorney fees on awards for disability would be limited to 20 percent of the “amount in dispute.”
• Hearings of the state’s Workers’ Compensation Court would have to be held in the county where the injury occurred, or by video conference conducted at the nearest regional technology center school. Currently those hearings are held only in Oklahoma City or Tulsa.
• Except in cases involving corrective surgery, permanent partial disability could not be awarded unless there is “objective evidence” of an anatomical abnormality and proof that the employee’s wage-earning ability has been “adversely impaired.” The requirement for objective medical findings is directed primarily at claims seeking benefits for sprains and strains, which account for many workers’ comp cases, as well as claims alleging psychological impairment.
• The court could order an independent medical examiner to determine whether surgery should be performed on an injured worker, if the claimant and the treating physician disagreed.

Maybe next time
Oklahoma lawmakers have buried proposals this session to change the state insurance commissioner position from an elected office to one that is appointed by the governor, according to Associated Press reports.

The current officeholder, Insurance Commissioner Carroll Fisher, was indicted last month by a grand jury and faces four felony counts related to operating a charity illegally and embezzling funds from required continuing education courses. He has also been embroiled in driving-under-the-influence issues during the past year, and pleaded guilty to DUI charges in November 2003.

However, proponents of moves to appoint the commissioner maintain they have nothing to do with pending charges against Fisher.

Proposals for amendments to the state Constitution to let the governor appoint insurance commissioners were reportedly kept from House and Senate committees.

Sen. Maxine Horner, D-Tulsa, chairman of the Senate Business and Labor Committee, refused to hear Republican Sen. Mark Snyder’s Senate Joint Resolution 33 to appoint the commissioner, on grounds that voters should have a say in who fills the
position.

Snyder attributed the failure of his bills to the populist belief of electing rather than appointing officials.

State Rep. Larry Roberts, D-Miami, chairman of the House Rules Committee, shunned a similar proposal by Reps. Dan Boren, D-Seminole, and John Trebilcock, R-Broken Arrow. Roberts also maintained the voters should be allowed to choose.

Boren felt the ability to appoint the commissioners would give a governor more authority to create an administration.

Oklahoma is one of 11 states with an elected insurance commissioner. The other states are Florida, Georgia, North Carolina, Mississippi, Louisiana, Kansas, North Dakota, California, Washington and Montana.