Government & Legal Update
Advocacy Update: A Busy Session Concludes as We Emerge from the Pandemic The 2021 session of the 112th General Assembly adjourned Wednesday, May 5, with the Legislature passing the 2021-22 appropriations bill the week prior. The $42.6 billion state budget reflects an improvement in economic outlook for Tennessee as it emerges from the COVID-19 pandemic. Some budget items of note include: • • • • • • •
$931 million for capital maintenance and improvements $145 million for air/rail transportation infrastructure $100 million in broadband funding $100 million for local infrastructure $37.9 million to fully fund TennCare growth $5 million for health care safety net $250 million for a Mental Health Trust Fund
The budget adds no new debt and extends the "Rainy-Day Fund" to $1.55 billion. The budget also includes significant investment in public-private partnerships through the use of one-time grant money. Click here to see the official press release from Governor Lee. The legislature will reconvene on at 12:00 noon (CST) on January 11, 2022. Below is an overview of insurance-related legislation of interest. Insurance Policies – Assignment of Benefits (SB1376) The bill clarifies that the rights, duties, or benefits provided by a policy of insurance issued under the present law insurance provisions may be assigned only as expressly provided by the terms of the policy of insurance or as otherwise expressly allowed by the insurer, except for assignment of benefits to health care providers pursuant to present law. The bill was promoted by the Farm Bureau in an effort to curtail “assignment of benefit” litigation experienced in other states Liability of GC, Intermediate Contractor, or Sub (SB0629): The legislation adds that a general contractor, intermediate contractor, or subcontractor is not liable for workers' compensation to a construction services provider for injuries occurring during the time period of December 9, 2019, through September 9, 2021, if certain conditions are met. The became effective upon being signed by the Governor on April 7, 2021. Work Comp - CSP Administration (SB1268) Transfers administration of construction service provider registration from the secretary of state to the bureau of workers compensation. The bill was signed by the Governor on April 7, 2021 and is effective January 1, 2022. Work Comp - Attorney Fees (SB1576) This was a Tennessee Chamber of Commerce-backed bill The Tennessee Insuror
that authorizes the court of workers compensation claims to award additional attorneys' fees and costs incurred when an employer wrongfully denies a claim or wrongfully fails to timely initiate benefits to which the employee or dependent is entitled for injuries that occur between July 1, 2021, and June 30, 2023. The bill was signed by the Governor on April 13, 2021 and is effective July 1, 2021. Work Comp - Misclassification of Employees (SB1577) The bill makes non-substantive changes to how the bureau of workers compensation seeks to ensure applicable employers comply with workers compensation law, including, but not limited to, enforcement and penalties for non-compliance. Clarifies which funds penalty fee revenue is to be allocated. This legislation will be repealed on July 1, 2024 and current statute, which this legislation replaces, will be revived at such time. The bill was promoted by the Tennessee Chamber of Commerce and NFIB, with input from IOT. It was signed by the Governor on April 20, 2021 is effective July 1, 2021. Work Comp - Disputes Concerning Employer's Failure to Provide Medical Care and Treatment (SB0764) An administration bill on behalf of the Bureau of Workers Compensation, the bill requires disputes concerning an employer's failure to provide medical care and treatment, medical services or medical benefits, or both, to meet certain requirements. Deletes requirement that all compensation be paid prior to an employee qualifying for vocational recovery assistance. Extends current provisions, as amended, for four years. Authorizes workers compensation judges to conduct judicial settlement conferences. The bill became law upon being signed by the Governor on April 30, 2021. Counties to Self-insure their Risk of Loss in Lieu of Obtaining Bonds or Insurance to Cover Liability (SB1261) Present law requires county governments to either (1) obtain and maintain blanket surety bond coverage for all county employees not covered by individual bonds or (2) obtain and pay the premiums or other costs with respect to a policy of insurance that provides government crime coverage, employee dishonesty insurance coverage, or equivalent coverage that insures the lawful performance by officials and their employees of their fiduciary duties and responsibilities. This bill adds that a county that has elected to self-insure its liability under the Tennessee Governmental Tort Liability Act may elect, by resolution of its governing body, to self-insure its risk of loss instead of obtaining the above-described bonds or insurance, under the same terms as bonds or insurance under present law. A county making an election under this bill must do so by two-thirds vote on the resolution and shall file a copy in the office of the register of deeds. The bill became effective 31
