ENROLLED
COMMITTEE SUBSTITUTE
FOR
H. B. 2878
(By Delegates H. White, R.M. Thompson, Hrutkay,
Perry, Azinger and G. White)
[Passed April 9, 2005; in effect ninety days from passage]
AN ACT to amend and reenact §23-1-1b of the Code of West Virginia,
1931, as amended; to amend and reenact §33-41-8 of said code;
and to amend said code by adding thereto a new section,
designated §33-41-8a; all relating to insurance fraud;
authorizing the Insurance Commissioner to assign the Workers'
Compensation Fraud and Abuse Unit to investigate insurance
fraud; permitting the Insurance Commissioner's fraud unit to
investigate Workers' Compensation fraud and the forgery of
insurance documents; designating the Fraud Unit a criminal
justice agency for purposes of access to information; and
requiring fingerprinting and background checks of applicants
for employment with the fraud unit.
Be it enacted by the Legislature of West Virginia:
That §23-1-1b of the Code of West Virginia, 1931, as amended,
be amended and reenacted; that §33-41-8 of said code be amended and
reenacted; and that said code be amended by adding thereto a new section, designated §33-41-8a, all to read as follows:
CHAPTER 23. WORKERS COMPENSATION.
ARTICLE 1. GENERAL ADMINISTRATIVE PROVISIONS.
§23-1-1b. Executive director; qualifications; oath; seal; removal;
powers and duties.
(a) The executive director shall be hired by the board of
managers for a term not to exceed five years and may be retained
based on overall performance for additional terms:
Provided, That
the executive director of the division of workers' compensation on
the date of the enactment of this section in the year two thousand
three shall serve as the initial executive director of the
commission and shall receive the same salary and benefits as
received as the executive director of the division of workers'
compensation through and until the board of managers establishes
his or her salary and benefits as the executive director of the
commission. The position of executive director shall be full-time
employment. Except for the initial executive director, candidates
for the position of executive director shall have a minimum of a
bachelor of arts or science degree from an accredited four-year
college or university in one or more of the following disciplines:
Finance; economics; insurance administration; law; public
administration; accounting; or business administration. Candidates
for the position of executive director will be considered based on
their demonstrated education, knowledge and a minimum of ten years'
experience in the areas of workers' compensation, insurance company management, administrative and management experience with an
organization comparable in size to the workers' compensation
commission or any relevant experience which demonstrates an ability
to effectively accomplish the purposes of this chapter.
(b) The executive director shall not be a candidate for or
hold any other public office or trust, nor shall he or she be a
member of a political committee. If he or she becomes a candidate
for a public office or becomes a member of a political committee,
his or her office as executive director shall be immediately
vacated.
(c) The executive director, before entering upon the duties of
his or her office, shall take and subscribe to the oath prescribed
by section five, article IV of the state constitution. The oath
shall be filed with the secretary of state.
(d) The executive director shall have an official seal for the
authentication of orders and proceedings, upon which seal shall be
engraved the words "West Virginia Workers' Compensation Commission"
and any other design prescribed by the board of managers. The
courts in this state shall take judicial notice of the seal of the
commission and in all cases copies of orders, proceedings or
records in the office of the West Virginia workers' compensation
commission are equal to the original in evidence.
(e) The executive director shall not be a member of the board
of managers.
(f) The executive director shall serve until the expiration of
his or her term, resignation or until removed by a two-thirds vote of the full board of managers. The board of managers and the
executive director may, by agreement, terminate the term of
employment at any time.
(g) The executive director shall have overall management
responsibility and administrative control and supervision within
the workers' compensation commission and has the power and duty to:
(1) Establish, with the approval of the board of managers, the
overall administrative policy of the commission for the purposes of
this chapter;
(2) Employ, direct and supervise all employees required in the
connection with the performance of the duties assigned to the
commission by this chapter and fix the compensation of the
employees in accordance with the provisions of article six, chapter
twenty-nine of this code:
Provided, That the executive director
shall identify which members of the staff of the workers'
compensation commission shall be exempted from the salary schedules
or pay plan adopted by the state personnel board and further
identify such staff members by job classification or designation,
together with the salary or salary ranges for each such job
classification or designation and shall file this information with
the director of the division of personnel no later than the thirty-
first day of December, two thousand three, and thereafter as
changes are made or at least annually:
Provided, however, That,
effective the first day of July, two thousand six, if the
commission has not been terminated or otherwise discontinued, all
employees of the commission shall be exempt and otherwise not under the jurisdiction of the provisions of the statutes, rules and
regulations of the classified service set forth in article six,
chapter twenty-nine of this code and article six-a of said chapter
and are afforded no protections, rights or access to procedures set
forth in said provision. All commission employees shall be
employees at will unless his or her employment status is altered by
an express, written employment contract executed on behalf of the
commission and the employee. The commission and its employees shall
be exempt and otherwise not under the jurisdiction of the state
personnel board, the department of personnel, or any other
successor agency, and their statutes, rules and regulations;
(3) Reorganize the work of the commission, its divisions,
sections and offices to the extent necessary to achieve the most
efficient performance of its functions. All persons employed by the
workers' compensation division in positions that were formerly
supervised and directed by the commissioner of the bureau of
employment programs under chapter twenty-one-a of this code are
hereby assigned and transferred in their respective classifications
to the workers' compensation commission effective the first day of
October, two thousand three. Further, the executive director may
select persons that are employed by the bureau of employment
programs on the effective date of the enactment of this section in
the year two thousand three to be assigned and transferred to the
workers' compensation commission in their respective
classifications, such assignment and transfer to take effect no
later than the thirty-first day of December, two thousand three. Employees in the classified service who have gained permanent
status as of the effective date of this article will not be subject
to further qualifying examination in their respective
classifications by reason of any transfer required by the
provisions of this subdivision. Due to the emergency currently
existing at the commission and the urgent need to develop fast,
efficient claims processing, management and administration, the
executive director is hereby granted authority to reorganize
internal functions and operations and to delegate, assign,
transfer, combine, establish, eliminate and consolidate
responsibilities and duties to and among the positions transferred
under the authority of this subdivision. The division of personnel
shall cooperate fully by assisting in all personnel activities
necessary to expedite all changes for the commission. The executive
director is hereby granted authority to reorganize internal
functions and operations and to delegate, assign, transfer,
combine, establish, eliminate and consolidate responsibilities and
duties to and among the positions transferred under the authority
of this subdivision. The division of personnel shall cooperate
fully by assisting in all personnel activities necessary to
expedite all changes for the commission and shall otherwise
continue to provide all necessary administrative support to the
commission in connection with the commission's personnel needs
until the company established in article two-c of this chapter
becomes operational. Nothing contained in this subdivision shall be
construed to either abridge the rights of employees within the classified service of the state to the procedures and protections
set forth in article six, chapter twenty-nine of this code or to
preclude the reclassification or reallocation of positions in
accordance with procedures set forth in said article;
(4) Exempt no more than twenty-five of any of the newly
created positions from the classified service of the state, the
employees of which positions shall serve at the will and pleasure
of the executive director. The executive director shall report all
exemptions made under this subdivision to the director of the
division of personnel no later than the first day of January, two
thousand four, and thereafter as the executive director determines
to be necessary;
(5) With the advice and approval of the board of managers,
propose operating guidelines and policies to standardize
administration, expedite commission business and promote the
efficiency of the services provided by the commission;
(6) Prepare and submit to the board of managers information
the board requires for classifications of occupations or
industries; the basis for premium rates, taxes, surcharges and
assessment for administrative charges, for assessments related to
loss experience, for assessments of prospective risk exposure, for
assessments of deficit management and deficit reduction costs
incurred, for other deficit management and deficit reduction
assessments, for rules and systems of rating, rate revisions and
merit rating for employers covered by this chapter; and information
regarding the extent, degree and amount of subsidization between the classifications. The executive director shall obtain, prepare
and submit any other information the board of managers requires for
the prompt and efficient discharge of its duties;
(7) Keep accurate and complete accounts and records necessary
to the collection, administration and distribution of the workers'
compensation funds;
(8) Sign and execute in the name of the state, by "The Workers'
Compensation Commission", any contract or agreement;
(9) Make recommendations and an annual report to the governor
concerning the condition, operation and functioning of the
commission;
(10) Invoke any legal or special remedy for the enforcement of
orders or the provisions of this chapter;
(11) Prepare and submit for approval to the board of managers
a budget for each fiscal year, including estimates of the costs and
necessary expenditures of the commission in the discharge of all
duties imposed by this chapter as well as the costs of furnishing
office space to the officers and employees of the commission;
(12) Ensure that all employees of the commission follow the
orders, operating guidelines and policies of the commission as they
relate to the commission's overall policymaking, management and
adjudicatory duties under this chapter;
(13) Delegate all powers and duties vested in the executive
director to his or her appointees and employees; but the executive
director is responsible for their acts;
(14) Provide at commission expense a program of continuing professional, technical and specialized instruction for the
personnel of the commission. The executive director shall consult
with and report at least annually to the legislative oversight
commission on workforce investment for economic development to
obtain the most appropriate training using all available resources;
(15) (A) Contract or employ counsel to perform all legal
services for the commission including, but not limited to,
representing the executive director, board of managers and
commission in any administrative proceeding and in any state or
federal court. Additionally, the commission may, but shall not be
required to, call upon the attorney general for legal assistance
and representation as provided by law. The attorney general shall
not approve or exercise authority over in-house counsel or contract
counsel hired pursuant to this section;
(B) In addition to the authority granted by this section to
the executive director and notwithstanding any provision to the
contrary elsewhere in this code, use any attorney regularly
employed by the commission or the office of the attorney general to
represent the commission, the executive director or the board of
managers in any matter arising from the performance of its duties
or the execution of its powers under this chapter. In addition, the
executive director, with the approval of the board of managers, may
retain counsel for any purpose in the administration of this
chapter relating to the collection of any amounts due from
employers to the commission:
Provided, That the allocation of
resources for the purpose of any collections shall be pursuant to the plan developed by the board of managers. The board of managers
shall solicit proposals from counsel who are interested in
representing the commission under the terms of this subdivision.
Thereafter, the board of managers shall select any attorneys it
determines necessary to pursue the collection objectives of this
subdivision:
(i) Payment to retained counsel may either be hourly or by
other fixed fee, or as determined by the court or administrative
law judge as provided in this section. A contingency fee payable
from the amount recovered by judgment or settlement for the
commission is only permitted, to the extent not prohibited by
federal law, when the assets of a defendant or respondent are
depleted so that a full recovery plus attorneys' fees is not
possible;
(ii) In the event that any collections action, other than a
collections action against a claimant, initiated either by retained
counsel or other counsel on behalf of the commission results in a
judgment or settlement in favor of the commission, the court or, if
there was no judicial component to the action, the administrative
law judge, shall determine the amount of attorneys' fees that shall
be paid by the defendants or respondents to the retained or other
counsel representing the commission. If the court is to determine
the amount of attorneys' fees, it shall include in its
determination the amount of fee that should be paid for the
representation of the commission in pursuing the administrative
component, if any, of the action. The amount so paid shall be fixed by the court or the administrative law judge in an amount no less
than twenty percent of its recovery. Any additional amount of
attorneys' fees shall be determined by use of the following
factors:
(I) The counsel's normal hourly rate or, if the counsel is an
employee of the commission or is an employee of the office of the
attorney general, an hourly rate the court or the administrative
law judge determines to be customary based upon the attorney's
experience and skill level;
(II) The number of hours actually expended on the action;
(III) The complexity of the issues involved in the action;
(IV) The degree of risk involved in the case with regard to
the probability of success or failure;
(V) The overhead costs incurred by counsel with regard to the
use of paralegals and other office staff, experts and
investigators; and
(VI) The public purpose served or public objective achieved by
the attorney in obtaining the judgment or settlement on behalf of
the commission;
(iii) Notwithstanding the provisions of paragraph (B) of this
subdivision, if the commission and the defendants or respondents to
any administrative or judicial action settle the action, the
parties may negotiate a separate settlement of attorneys' fees to
be paid by the defendants or respondents above and beyond the
amount recovered by the commission. In the event that a settlement
of attorneys' fees is made, it must be submitted to the court or administrative law judge for approval;
(iv) Any attorney regularly employed by the commission or by
the office of the attorney general may not receive any remuneration
for his or her services other than the attorney's regular salary.
Any attorneys' fees awarded for an employed attorney are payable to
the commission;
(16) Propose rules for promulgation by the board of managers
under which agencies of this state shall revoke or refuse to grant,
issue or renew any contract, license, permit, certificate or other
authority to conduct a trade, profession or business to or with any
employing unit whose account is in default with the commission with
regard to the administration of this chapter. The term "agency"
includes any unit of state government such as officers, agencies,
divisions, departments, boards, commissions, authorities or public
corporations. An employing unit is not in default if it has entered
into a repayment agreement with the commission and remains in
compliance with its obligations under the repayment agreements;
(A) The rules shall provide that, before granting, issuing or
renewing any contract, license, permit, certificate or other
authority to conduct a trade, profession or business to or with any
employing unit, the designated agencies shall review a list or
lists provided by the commission of employers that are in default.
If the employing unit's name is not on the list, the agency, unless
it has actual knowledge that the employing unit is in default with
the commission, may grant, issue or renew the contract, license,
permit, certificate or other authority to conduct a trade, profession or business. The list may be provided to the agency in
the form of a computerized database or databases that the agency
can access. Any objections to the refusal to issue or renew shall
be reviewed under the appropriate provisions of this chapter. The
prohibition against granting, issuing or renewing any contract,
license, permit, certificate or other authority under this
subdivision shall remain in full force and effect as promulgated
under section six, article two, chapter twenty-one-a of this code
until the rules required by this subsection are promulgated and in
effect;
(B) The rules shall also provide a procedure allowing any
agency or interested person, after being covered under the rules
for at least one year, to petition the commission to be exempt from
the provisions of the rules;
(17) Deposit to the credit of the appropriate special revenue
account or fund, notwithstanding any other provision of this code
and to the extent allowed by federal law, all amounts of delinquent
payments or overpayments, interest and penalties thereon and
attorneys' fees and costs collected under the provisions of this
chapter. The amounts collected shall not be treated by the auditor
or treasurer as part of the general revenue of the state;
(18) Recommend for approval of the board of managers rules for
the administration of claims management by self-insured employers
and third-party administrators including regulation and sanctions
for the rejection of claims and for maintaining claim records and
ensuring access to all claim records by interested claimants, claimant representatives, the commission and the office of judges;
(19) Recommend for approval of the board of managers, rules to
eliminate the ability of an employer to avoid an experience
modification factor by virtue of a reorganization of a business;
(20) Submit for approval of the board of managers rules
setting forth procedures for auditing and investigating employers,
including employer premium audits and including auditing and
investigating programs of self-insured employers and third-party
administrators, employees, health care providers and medical and
vocational rehabilitation service providers;
(21) Regularly audit and monitor programs established by self-
insured or third-party administrators under this chapter to ensure
compliance with the commission's rules and the law;
(22) Facilitate the transfer of the fraud investigation and
prosecution unit, along with the assets necessary to support the
functions being performed, to the insurance commissioner. This
transfer shall be completed by the first day of July, two thousand
five. This unit has the responsibility and authority for
investigating and controlling fraud of the workers' compensation
system of the state of West Virginia and shall perform such other
duties as may be assigned to it by the Insurance Commissioner. The
fraud unit shall be under the supervision of an inspector general,
who shall be appointed by the insurance commissioner. Nothing in
this section shall preclude the commission or, when applicable, the
company created in article two-c of this chapter and other private
carriers, from independently investigating and controlling abuse and exercising the powers granted to the commission to address and
eliminate abuse under this chapter. The executive director may
select persons that are assigned to the fraud and abuse unit on the
effective date of the enactment of this section to be assigned and
remain employees of the workers' compensation commission. The
commission shall determine its fiscal year two thousand six budget
for the fraud investigation and prosecution unit and shall make
advanced quarterly payments to the insurance commissioner during
fiscal year two thousand six for the actual operational expenses
incurred as a direct result of this transfer.
Provided, That the
payments and expenses shall be reconciled prior to the final fiscal
year transfer and any unexpended amount shall be deducted from the
final quarter's payment. This reimbursement methodology shall
repeat for fiscal year two thousand seven. Any amounts transferred
under this section to the insurance commissioner shall be
appropriated by the Legislature. The commission's inspector general
shall serve as the initial inspector general for the insurance
commissioner;
(A) The inspector general shall, with the consent and advice
of the executive director, employ all personnel as necessary for
the institution, development and finalization of procedures and
investigations which serve to ensure that only necessary and proper
workers' compensation benefits and expenses are paid to or on
behalf of injured employees and to insure employers subscribe to
and pay the proper premium to the West Virginia workers'
compensation commission. Qualification, compensation and personnel practice relating to the employees of the fraud and abuse unit,
including that of the position of inspector general, shall be
governed by the provisions of the statutes and rules of the
classified service pursuant to article six, chapter twenty-nine of
this code. The inspector general shall supervise all personnel,
which collectively shall be referred to in this chapter as the
fraud and abuse unit;
(B) The fraud and abuse unit shall have the following powers
and duties:
(i) The fraud and abuse unit shall propose for promulgation by
the board of managers rules for determining the existence of fraud
and abuse as it relates to the workers' compensation system in West
Virginia;
(ii) The fraud and abuse unit will be responsible for the
initiation, development, review and proposal for promulgation by
the board of managers of rules regarding the existence of fraud and
abuse as it relates to the workers' compensation system in West
Virginia;
(iii) The fraud and abuse unit will take action to identify
and prevent and discourage any and all fraud and abuse;
(iv) The fraud and abuse unit, in cases of criminal fraud, has
the authority to review and prosecute those cases for violations of
sections twenty-four-e, twenty-four-f, twenty-four-g and twenty-
four-h, article three, chapter sixty-one of this code, as well as
any other criminal statutes that may be applicable. In addition the
fraud and abuse unit not only has the authority to prosecute and refer cases involving criminal fraud to appropriate state
authorities for prosecution, but it also has the authority, and is
encouraged, to cooperate with the appropriate federal authorities
for review and possible prosecution, by either state or federal
agencies, of cases involving criminal fraud concerning the workers'
compensation system in West Virginia;
(v) The fraud and abuse unit, in cases which do not meet the
definition of criminal fraud, but would meet a reasonable person's
definition of an abuse of the workers' compensation system, shall
take the appropriate action to discourage and prevent such abuse.
Furthermore, the fraud and abuse unit shall assist the commission
to develop evidence of fraud or abuse which can be used pursuant to
the provisions of this chapter to suspend, and where appropriate,
terminate, a claimant's benefits. In addition, evidence developed
pursuant to these provisions can be used in hearings before the
office of judges on protests to commission decisions terminating,
or not terminating, temporary total disability benefits; and
(vi) The fraud and abuse unit is expressly authorized to
initiate investigations and participate in the development of, and
if necessary, the prosecution of any health care provider,
including a provider of rehabilitation services, alleged to have
violated the provisions of section three-c, article four of this
chapter;
(C) Specific personnel, designated by the inspector general,
shall be permitted to operate vehicles owned or leased for the
state displaying Class A registration plates;
(D) Notwithstanding any provision of this code to the
contrary, specific personnel designated by the inspector general
may carry handguns in the course of their official duties after
meeting specialized qualifications established by the governor's
committee on crime, delinquency and correction, which
qualifications shall include the successful completion of handgun
training provided to law-enforcement officers by the West Virginia
state police:
Provided, That nothing in this subsection shall be
construed to include the personnel so designated by the inspector
general to carry handguns within the meaning of the term law-
enforcement official as defined in section one, article twenty-
nine, chapter thirty of this code;
(E) The fraud and abuse unit is not subject to any requirement
of article nine-a, chapter six of this code and the investigations
conducted by the fraud and abuse unit and the materials placed in
the files of the unit as a result of any such investigation are
exempt from public disclosure under the provisions of chapter
twenty-nine-b of this code;
(F) In the event that a final judicial decision adjudges that
the statewide prosecutorial powers vested by this subdivision in
the fraud and abuse unit may only be exercised by a public official
other than an employee of the fraud and abuse unit, then to that
extent the provisions of this subdivision vesting statewide
prosecutorial power shall thenceforth be of no force and effect,
the remaining provisions of this subdivision shall continue in full
force and effect and prosecutions hereunder may only be exercised by the prosecuting attorneys of this state and their assistants or
special assistant prosecuting attorneys appointed as provided by
law;
(23) Enter into interagency agreements to assist in exchanging
information and fulfilling the default provisions of this chapter;
(24) Notwithstanding any provision of this code to the
contrary, the executive director, under emergency authorization:
(A) May expend up to fifty thousand dollars for purchases of and
may contract for goods and services without securing competitive
bids. This emergency spending authority expires on the first day of
July, two thousand five; and
(B) May expend such sums as the executive director determines
are necessary for professional services, contracts for the purchase
of an automated claims administration system and associated
computer hardware and software in the administration of claims for
benefits made under provisions of this chapter and contracts for
technical services and related services necessary to develop,
implement and maintain the system and associated computer hardware
and software. The provisions of article three, chapter five-a of
this code relating to the purchasing division of the department of
administration shall not apply to these contracts. The director
shall award the contract or contracts on a competitive basis. This
emergency spending authority expires on the thirty-first day of
December, two thousand six;
(25) Establish an employer violator system to identify
individuals and employers who are in default or are delinquent on any premium, assessment, surcharge, tax or penalty owed to the
commission. The employer violator system shall prohibit violators
who own, control or have a ten percent or more ownership interest,
or other ownership interest as may be defined by the commission, in
any company from obtaining or maintaining any license, certificate
or permit issued by the state until the violator has paid all
moneys owed to the commission or has entered into and remains in
compliance with a repayment agreement;
(26) Propose the designation of health care providers to make
decisions for the commission regarding appropriateness of medical
services;
(27) Study the correlation between premium tax merit rating
for employers and the safety performance of employers. This study
shall be completed prior to the first day of July, two thousand
four, and the results thereof provided to the board of managers;
(28) Upon termination of the commission, accomplish the
transfer to the insurance commissioner established in article two-c
of this chapter, the insurance commissioner, and any other
applicable state agency or department, of the functions necessary
for the regulation of the workers' compensation insurance industry,
including, but not limited to, the following commission functions:
rate making, self-insurance, office of judges and board of review.
The executive director may select persons that are assigned to
these functions on the effective date of the enactment of this
section to be assigned and become employees of the company as
established in article two-c of this chapter. The executive director may, in consultation with the insurance commissioner,
select persons that are assigned to the insurance commissioner. The
commission shall determine its fiscal year two thousand six budget
for each of these functions, reduce the budget amount attributable
to self-insured employers for these functions and shall make
advanced quarterly payments to the insurance commissioner during
fiscal year two thousand six for the actual operational expenses
incurred as a direct result of this transfer. The amount shall
include the funds necessary to operate the industrial council and
the insurance commissioner shall be administratively responsible
for the industrial council's budget:
Provided, That the payments
and expenses shall be reconciled prior to the final fiscal year
transfer and any unexpended amount shall be deducted from the final
quarter's payment. This reimbursement methodology shall repeat for
fiscal year two thousand seven. Any amounts transferred under this
section to the insurance commissioner shall be appropriated by the
Legislature. For the final calendar quarter of two thousand five
and the first and second calendar quarters of the year two thousand
six, all self- insured employers shall remit to the insurance
commissioner on a quarterly basis the administrative component of
their fiscal year two thousand six rate. For the fiscal year
beginning the first day of July, two thousand six, self-insured
employers shall remit an administrative charge to the insurance
commissioner in an amount determined by the commissioner. All self-
insured employer advance deposits shall transfer from the
commission to the insurance commissioner upon termination of the commission; and
(29) Perform all duties set forth in article two-c of this
chapter.
CHAPTER 33. INSURANCE.
ARTICLE 41. INSURANCE FRAUD PREVENTION ACT.
§33-41-8. Creation of insurance fraud unit; purpose; duties;
personnel qualifications.
(a) There is established the West Virginia insurance fraud
unit within the office of the Insurance Commissioner of West
Virginia. The Commissioner may employ full-time supervisory, legal
and investigative personnel for the unit, who shall be qualified by
training and experience in the areas of detection, investigation or
prosecution of fraud within and against the insurance industry to
perform the duties of their positions. The Director of the fraud
unit is a full-time position and shall be appointed by the
Commissioner and serve at his or her will and pleasure. The
Commissioner shall provide office space, equipment, supplies,
clerical and other staff that is necessary for the unit to carry
out its duties and responsibilities under this article.
(b) The fraud unit may in its discretion:
(1) Initiate inquiries and conduct investigations when the
unit has cause to believe violations of any of the following
provisions of this code relating to the business of insurance have
been or are being committed: Chapter twenty-three; chapter thirty-
three; article three of chapter sixty-one; and section five, article four of chapter sixty-one.
(2) Review reports or complaints of alleged fraud related to
the business of insurance activities from federal, state and local
law-enforcement and regulatory agencies, persons engaged in the
business of insurance and the general public to determine whether
the reports require further investigation; and
(3) Conduct independent examinations of alleged fraudulent
activity related to the business of insurance and undertake
independent studies to determine the extent of fraudulent insurance
acts.
(c) The insurance fraud unit may:
(1) Employ and train personnel to achieve the purposes of this
article and to employ legal counsel, investigators, auditors and
clerical support personnel and other personnel as the Commissioner
determines necessary from time to time to accomplish the purposes
of this article;
(2) Inspect, copy or collect records and evidence;
(3) Serve subpoenas issued by grand juries and trial courts in
criminal matters;
(4) Share records and evidence with federal, state or local
law-enforcement or regulatory agencies, and enter into interagency
agreements. For purposes of carrying out investigations under this
article, the unit shall be deemed a criminal justice agency under
all federal and state laws and regulations and as such shall have
access to any information that is available to other criminal
justice agencies concerning violations of the insurance laws of West Virginia or related criminal laws;
(5) Make criminal referrals to the county prosecutors;
(6) Conduct investigations outside this state. If the
information the insurance fraud unit seeks to obtain is located
outside this state, the person from whom the information is sought
may make the information available to the insurance fraud unit to
examine at the place where the information is located. The
insurance fraud unit may designate representatives, including
officials of the state in which the matter is located, to inspect
the information on behalf of the insurance fraud unit, and the
insurance fraud unit may respond to similar requests from officials
of other states;
(7) The insurance fraud unit may initiate investigations and
participate in the development of, and if necessary, the
prosecution of any health care provider, including a provider of
rehabilitation services, suspected of fraudulent activity related
to the business of insurance;
(8) Specific personnel, designated by the Commissioner, shall
be permitted to operate vehicles owned or leased for the state
displaying Class A registration plates;
(9) Notwithstanding any provision of this code to the
contrary, specific personnel designated by the Commissioner may
carry firearms in the course of their official duties after meeting
specialized qualifications established by the Governor's committee
on crime, delinquency and correction, which shall include the
successful completion of handgun training provided to law-enforcement officers by the West Virginia State Police:
Provided, That nothing in this subsection shall be construed to
include any person designated by the Commissioner as a
law-enforcement officer as that term is defined by the provisions
of section one, article twenty-nine, chapter thirty of this code;
and
(10) The insurance fraud unit shall not be subject to the
provisions of article nine-a, chapter six of this code and the
investigations conducted by the insurance fraud unit and the
materials placed in the files of the unit as a result of any such
investigation are exempt from public disclosure under the
provisions of chapter twenty-nine-b of this code.
(d) The insuarnce fraud unit shall perform other duties as may
be assigned to it by the Commissioner.
§33-41-8a. Fingerprinting and background check for applicants for
employment with fraud unit.
(a) The Commissioner shall require any applicant for
employment with the fraud unit to be fingerprinted. The
Commissioner is authorized to conduct a criminal records check
through the Criminal Identification Bureau of the West Virginia
State Police and a national criminal history check through the
Federal Bureau of Investigation. The results of any criminal
records or criminal history check shall be sent to the
Commissioner. The West Virginia State Police may exchange this
fingerprint data with the Federal Bureau of Investigation.
(b) The Director shall not disclose information obtained pursuant to subsection (a) of this section except for purposes
directly related to the employment of the applicant.
NOTE: The purpose of this bill is to clarify that the
insurance fraud unit can participate in law-enforcement information
exchange, complete criminal background checks on potential
employees of the fraud unit and assist other law-enforcement
agencies. It also allows the fraud unit to investigate forgery of
insurance documents. It also permits the insurance commissioner
to assign additional duties to the workers' compensation fraud unit
after the transfer of that unit to the insurance commission on July
1, 2005.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
§33-41-8a is new; therefore, strike-throughs and underscoring
have been omitted.