SECTION 126.13. Employer Initiation of Benefits and Reimbursement

(a) Applicability

(1) This section applies only to the employer initiation of benefits as described in subsection (a)(2) of this section. Employer payments made after the insurance carrier has accepted or been found to be liable for a claim such as salary continuation, as defined in §129.1 (relating to Definitions for Temporary Income Benefits), are covered by Chapter 129 of this title (relating to Temporary Income Benefits).

(2) An employer may initiate benefits including medical benefits to compensate an employee during a period in which the carrier has:

(A) contested compensability of the injury;

(B) contested liability for the injury; or

(C) has not completed its initial investigation of the injury, which is limited to seven days after the carrier receives first written notice of the injury as defined in §124.1 of this title (relating to Notice of Injury).

(b) Employer Entitlement to Reimbursement

(1) An employer who initiates benefits as provided in subsection (a)(2) of this section is entitled to reimbursement from the carrier if the employer timely reported the injury to the carrier in compliance with §120.2 (relating to Employer's First Report of Injury).

(2) An employer who is entitled to reimbursement as provided in subsection (b)(1) of this section is entitled to the amount of those benefits which otherwise would have been paid by the carrier had the carrier immediately accepted compensability for the injury and began payment of income and medical benefits.

(A) For an employer initiation of indemnity benefits, the amount of reimbursement that the employer is entitled to is the amount that would have been paid by the carrier in income benefits. Chapters 128, (relating to Benefits - Calculation of Average Weekly Wage), 129 (relating to Benefits - Temporary Income Benefits), 130 (relating to Benefits - Impairment & Supplemental Income Benefits), and 131 (relating to Calculation of Lifetime Income Benefits) of this title govern carrier payments of income benefits.

(B) For an employer initiation of medical benefits, the amount of reimbursement that the employer is entitled to is the amount that would have been paid by the carrier in medical benefits. An employer is not entitled to and shall not seek reimbursement from either the carrier or the employee for amounts paid to a health care provider which are:

(i) in excess of the Commission's fee guidelines;

(ii) for treatment(s) or service(s) which was not reasonable or medically necessary; or

(iii) for treatment(s) or service(s) which was not related to the compensable injury.

(3) An employer who is entitled to reimbursement under subsection (b)(1) of this section but who paid more benefits to the employee than the carrier was required to pay in income benefits is entitled to be reimbursed for the difference if the employer initiated the benefits with the agreement of the employee and the agreement authorized the reimbursement of this difference. The difference is reimbursable out of impairment income benefits (IIBs) that the employee becomes entitled to, if any.

(4) An employer is not entitled to and shall not seek reimbursement from the employee for any benefits initiated by the employer which are not reimbursed under subsection (c) of this section.

(c) Reporting and Reimbursement Process

(1) An employer who initiates payment of benefits as provided in subsection (a) of this section shall report the initiation of benefits to the carrier within seven days of this initiation.

(2) A carrier who is notified by an employer that the employer has initiated benefits as provided in subsection (c)(1) of this section shall notify the employer in writing within seven days of the carrier either accepting or being found to be liable for a claim.

(3) Within seven days of being notified by the carrier that the carrier has accepted or been found liable for a claim, the employer shall report to the carrier in the form and manner prescribed by the Commission the amount of any benefits provided to the employee.

(4) A carrier who receives a report of benefits initiated by the employer as described in this section shall, not later than the seventh day after the carrier receives the report, reimburse the employer the compensation that the carrier would have otherwise paid.

(5) The carrier shall pay the employer a reimbursement out of IIBs as provided in subsection (b)(3) of this section in lump sum and shall apportion this amount equally across the employee's remaining weekly IIBs payments. The carrier shall pay this reimbursement in a lump sum not later than the seventh day after the later of:

(A) the date the carrier receives a certification of MMI with an impairment rating of greater than 0%; or

(B) the date an impairment rating dispute is resolved by a designated doctor's opinion, agreement, or final adjudication.

Source Note: The provisions of this §126.13 adopted to be effective December 26, 1999, 24 TexReg 11399