Part 1. TEXAS DEPARTMENT OF INSURANCE

Chapter 7. CORPORATE AND FINANCIAL REGULATION

Subchapter A. EXAMINATION AND FINANCIAL ANALYSIS

28 TAC §7.18

The Texas Department of Insurance proposes amendments to §7.18 concerning Statements of Statutory Accounting Principles (SSAP) which provide guidance to independent accountants, industry accountants and department analysts and examiners as to how to properly record business transactions for the purpose of accurate statutory reporting. SSAP provide a nationwide standard method of accounting which most insurers, including health maintenance organizations, are required to use for statutory financial reporting guidance, thus creating a more consistent regulatory environment; however, they do not preempt individual state legislative and regulatory authority. SSAP are adopted by the National Association of Insurance Commissioners (NAIC) through its maintenance process which involves preparation of the SSAP, exposure, comment and adoption by the NAIC. The Manual is a comprehensive guide to statutory accounting principles. It includes the SSAP that have been adopted by the NAIC. When new versions of the Manual are made available by the NAIC, the Commissioner of the Texas Department of Insurance considers the new version and, if he deems appropriate, proposes for public comment adoption of the new version, with any necessary modifications, by rule. The proposed amendments will adopt by reference the March 2003 version of the Accounting Practices and Procedures Manual with the exceptions noted in §7.18; delete paragraphs (1) and (5) in subsection (c) since they will become obsolete with the adoption of the March 2003 version of the Accounting Practices and Procedures Manual; renumber subsection (c) to reflect the deletion of paragraphs (1) and (5); and change several Texas Insurance Code references as a result of the state's continuing statutory revision program.

Ms. Betty Patterson, Senior Associate Commissioner, Financial Program, has determined that for the first five years the amended section is in effect, there will be no fiscal implications for state or local government as a result of this amendment, and there will be no effect on local employment or the local economy.

Ms. Patterson has also determined that, for each year of the first five years the amended section is in effect, the public benefit will be the more efficient regulation of insurance and a decrease in costs to insurers that are currently required to file multiple financial statements in multiple states. The proposed adoption of the March 2003 Manual will provide for a more consistent regulatory environment and will become a single source for accounting guidance. The March 2003 Manual is available from the NAIC at a cost of $200 for a soft cover manual and $395 on CD-ROM. The cost to comply with the provisions of the Manual will vary from insurer to insurer. Since the Manual was first adopted on January 1, 2001, most of the costs of programming and training have been incurred. Based upon the department’s experience, each company will have to ensure that at least one employee familiar with the company’s accounting practices is instructed in the provisions of the Manual and monitors changes in the Manual. This instruction can be accomplished through self-study, attendance at a seminar, or a combination of the two methods. The NAIC offers a self-study course at a cost of $175 per copy. Seminars which offer instruction on the Manual cost approximately $850 per attendee for a two-day course. The number of employees sent to training is largely dependent on the size and expertise of the company’s accounting staff, but is not dependent on the overall size of the company. As the size of the accounting staff increases, so does the likelihood that the company will choose to send more than one employee to a seminar for training. The department estimates that companies with five or fewer accounting employees will either require the use of self-study training or send one employee to a seminar. Those companies with six to ten employees on the accounting staff will likely send one to three employees to seminars for instruction and supplement that training with self-study materials. Those companies with eleven or more employees on the accounting staff will likely send three or more employees to seminars and supplement with self-study materials. Each employee is estimated to be compensated at a rate of $17 to $30 an hour. These estimates are based upon the department’s discussions with industry representatives. Changes in the Manual may also require changes to a company’s electronic accounting system. The cost of changes to accounting systems is dependent on the company’s line of insurance, the complexity of the company’s transactions, and whether the system is proprietary or created by third party vendors. Costs due to system changes increase with the complexity of transactions and the percentage of proprietary computer code in the system. In the department’s experience, small companies do not usually rely upon internally created proprietary systems and do not generally enter complex transactions on a regular basis. Large companies are more likely to have an internally created proprietary system and enter into complex transactions. Accordingly, system change costs, when necessary, will be greater for large companies. Thus, based upon all of the foregoing, it is the department’s position that the adoption of the Manual will have no adverse economic effect on small and micro businesses. Farm mutual insurance companies, mutual assessment companies, mutual aid associations, and mutual burial associations will incur no costs as a result of the proposed amendment, as they are specifically excepted from the section. Such companies have traditionally accounted for their business on a cash basis and the department has determined that compliance with the provisions of the Manual is not necessary for these types of companies. Regardless of the fiscal effect, the requirements of the section are mandated by the underlying state statutes, and considering the statutes' purposes, it is neither legal nor feasible to waive or modify the requirements of this section for small and micro businesses, as doing so would result in a disparate effect on enrollees, policyholders, and other persons affected by the section.

To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on February 2, 2004. All comments should be submitted to Gene C. Jarmon, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comments should be submitted simultaneously to Betty Patterson, Senior Associate Commissioner, Financial Program, Mail Code 305-2A, P. O. Box 149104, Austin, Texas 78714-9104. A request for a public hearing on the proposal should be submitted separately to the Office of the Chief Clerk.

The amendments are proposed under the Texas Insurance Code Articles 1.15, 1.32, 3.33, 5.61, 21.28-A, 21.39 and §§32.041, 36.001, 802.001, 823.012, 841.004, 843.151, 861.255, 862.001. Article 1.15 mandates that the department examine the financial condition of each carrier organized under the laws of Texas or authorized to transact the business of insurance in Texas and, by rule, adopt procedures for the filing and adoption of examination reports. Article 1.32 authorizes the Commissioner to establish standards for evaluating the financial condition of an insurer. Article 3.33 authorizes the Commissioner to adopt such rules, minimum standards, or limitations as may be appropriate for the implementation of the article. Article 5.61 provides that reserves shall be computed in accordance with rules adopted by the Commissioner for the purpose of adequately protecting insureds. Article 21.28-A authorizes the Commissioner to adopt rules necessary to accomplish the purposes of the act. Article 21.39 authorizes the Commissioner to adopt rules for establishing reserves applicable to each line of insurance recommended by the NAIC. Sections 32.041 and 802.001 authorize the Commissioner to provide required financial statement forms. Section 843.151 (formerly Article 20A.22) authorizes the Commissioner to promulgate rules as are necessary to carryout the provisions of Chapter 843 and Insurance Code Chapter 20A (the Texas Health Maintenance Organization Act). Section 823.012 (formerly Article 21.49-1) authorizes the Commissioner to issue rules and orders necessary to implement the provisions of Insurance Code, Chapter 823, Insurance Holding Company Systems. Sections 841.004, 861.255 and 862.001 (formerly Articles 3.01, 8.07, 6.12) authorize the Commissioner to adopt rules defining electronic machines and systems, office equipment, furniture, machines and labor saving devices and the maximum period for which each such class may be amortized. Section 36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of the department under the Insurance Code and other laws of this state.

The following provisions of the Texas Insurance Code are affected by this proposal: Articles 1.15, 21.39 and §§32.041, 802.001, 841.004, 861.255, 862.001.

§7.18.NAIC Accounting Practices and Procedures Manual.

(a) The purpose of this section is to adopt statutory accounting principles, which will provide independent accountants, industry accountants and department analysts and examiners guidance as to how to properly record business transactions for the purpose of accurate statutory reporting. The March 2003 [ 2002 ] version of the National Association of Insurance Commissioners Accounting Practices and Procedures Manual (Manual) will be utilized as the guideline for statutory accounting principles in Texas to the extent the Manual does not conflict with provisions of the Texas Insurance Code or rules of the department. The Commissioner reserves all authority and discretion to resolve any accounting issues in Texas. When making a determination on the proper accounting treatment for an insurance or health plan transaction the Commissioner shall refer to the sources in paragraphs (1)-(6) of this subsection in the respective order of priority listed. Furthermore, §§3.1501-3.1505, 3.1605, 3.1606, 3.7004, 7.7, 7.85 and 11.803 of this title (relating to Annuity Mortality Tables, General Requirements, Required Opinions, Contract Reserves, Subordinated Indebtedness, Audited Financial Reports and Investments, Loans and Other Assets), preempt any contrary provisions in the Manual.

(1) Texas statutes;

(2) department rules;

(3) directives, instructions and orders of the Commissioner;

(4) the Manual;

(5) other NAIC handbooks, manuals, and instructions, adopted by the department; and

(6) Generally Accepted Accounting Practices.

(b) The Commissioner adopts by reference the March 2003 [ 2002 ] version of the Accounting Practices and Procedures Manual published by the National Association of Insurance Commissioners, with the exceptions and additions set forth in subsections (c) and (d) of this section, as the source of accounting principles for the department when examining financial reports and for conducting statutory examinations and rehabilitations of insurers and health maintenance organizations licensed in Texas, except where otherwise provided by law. This adoption by reference shall be applied to examinations conducted as of January 1, 2004 [ 2003 ] and thereafter and also shall be used to prepare all financial statements filed with the department for periods after January 1, 2004 [ 2003 ].

(c) The Commissioner adopts the following exceptions and additions to the Manual:

(1) [ In addition to the statements of statutory accounting principles in the Manual, Statement of Statutory Accounting Principles number 85 concerning claim adjustment expenses, finalized June 10, 2002, Statement of Statutory Accounting Principles number 86 concerning accounting for derivatives and hedging activities, finalized May 14, 2002, and Statement of Statutory Accounting Principles number 87 concerning capitalization policy, finalized September 11, 2002 are adopted by reference. ]

[ (2) ] Retrospective premiums must be billed within 60 days of computation and audit premiums must be billed within 60 days of the completion of the audit in determining the beginning date from which the ninety day period is calculated to determine admissibility of uncollected premium balances under Statement of Statutory Accounting Principles number 6.

(2) [ (3) ] Electronic machines, constituting a data processing system or systems and operating systems software used in connection with the business of an insurance company acquired after December 31, 2000, may be an admitted asset as permitted by Texas Insurance Code §§841.004, 861.255, 862.001 [ Articles 3.01, 6.12, 8.07 ], and any other applicable law and shall be amortized as provided by the Manual. All such property acquired prior to January 1, 2001, may be an admitted asset as permitted by Texas Insurance Code §§841.004, 861.255, 862.001 [ Articles 3.01, 6.12, 8.07 ], and any other applicable law, and shall be amortized in full over a period not to exceed ten years.

(3) [ (4) ] Furniture, labor-saving devices, machines, and all other office equipment may be admitted as an asset as permitted by Texas Insurance Code §§841.004, 861.255, 862.001 [ Articles 3.01, 6.12, 8.07 ], and any other applicable law and, for such property acquired after December 31, 2000, depreciated in full over a period not to exceed five years. All such property acquired prior to January 1, 2001, may be an admitted asset as permitted by Texas Insurance Code §§841.004, 861.255, 862.001 [ Articles 3.01, 6.12, 8.07 ], and any other applicable law, and shall be depreciated in full over a period not to exceed ten years.

[ (5) Written premiums for all property and casualty contracts, other than contracts for workers’ compensation, shall be recorded as of the effective date of the contract rather than on the effective date of the contract as stated in Statement of Statutory Accounting Principles number 53. ]

(4) [ (6) ] Goodwill, as reported on a regulated entity’s statutory financial statements as of December 31, 2000, and any additional goodwill acquired thereafter, beginning January 1, 2001, shall be admitted as an asset and accounted for as permitted by Statements of Statutory Accounting Principles numbers 61 and 68. All other amounts of goodwill, including, but not limited to, such amounts that may have been previously expensed, shall not be allowed as an admitted asset. However, notwithstanding the provisions of Statements of Statutory Accounting Principles numbers 61 and 68, all methods of non-insurer subsidiary and affiliate valuation permitted by Texas Insurance Code §§823.301-823.307 [ Article 21.49-1 §6A ] may be used for the purposes of goodwill calculation.

(5) [ (7) ] All certificates of deposit, of any maturity, may be classified as cash and are subject to the accounting treatment contained in Statement of Statutory Accounting Principles number 2, notwithstanding the provisions of Statement of Statutory Accounting Principles number 26.

(d) A farm mutual insurance company, statewide mutual assessment company, local mutual aid association, or mutual burial association that has less than $5 million in annual direct written premiums need not comply with the Manual.

(e) This section shall not be construed to either broaden or restrict the authority provided under the Texas Insurance Code to insurers, including health maintenance organizations.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 16, 2003.

TRD-200308609

Gene C. Jarmon

General Counsel and Chief Clerk

Texas Department of Insurance

Earliest possible date of adoption: February 1, 2004

For further information, please call: (512) 463-6327

Chapter 143. DISPUTE RESOLUTION REVIEW BY THE APPEALS PANEL

28 TAC §§143.1, 143.3 - 143.5

The Texas Workers' Compensation Commission (the commission) proposes amendments to §143.1 (Definitions), §143.3 (Requesting the Appeals Panel to Review the Decision of the Hearing Officer), §143.4 (Responding to a Request for Review by the Appeals Panel), and §143.5 (Decision of the Appeals Panel). The amended sections are proposed to clarify certain issues, to incorporate statutory changes, and to make grammatical and citation corrections.

The Texas Register published text shows words proposed to be added to or deleted from the current text and should be read to determine all proposed changes.

The proposed deletion of §143.1(5) removes the definition of "served on (a party)" so that it may be more clearly stated in the proposed amendment to §143.3 and §143.4. These sections better explain what constitutes service of a request for review and response to request for review on the other party or parties and how to certify that proper service was made.

The proposed amendments to §143.3(a)(3) clarify that a request for review of a hearing officer's decision by the appeals panel filed anywhere in the commission meets the 15-day deadline for filing a request for review. By statute, if the appeals panel does not issue its decision within 30 days from the date on which the written response to the request for appeal is filed, the decision of the hearing officer becomes final and is the final decision of the appeals panel. The amended language stresses that filing documents directly with the commission's Chief Clerk of Proceedings will prevent delays that could reduce the time available for the appeals panel to review the documents and issue a decision. The appeals panel is without jurisdiction to consider an appeal that is not timely filed or to issue a decision after the 30-day time frame has expired.

Proposed new §143.3(a)(5) provides direction regarding how to certify that a copy of the request has been served on the other party or parties, and how that service must be accomplished. The commission believes that this provision will better assist parties in properly serving copies of requests on the other parties and in properly certifying that service was accomplished. Current §143.3(b) is proposed to be deleted, because the information in that provision is now included in §143.3(a)(5).

Proposed new §143.3(b) explains that, where it is not clear that the appeal was properly served on the other party or parties, the hearings division will determine whether service has been accomplished and, if not, will provide a copy of the appeal to the other party. This language essentially puts into the rule the actual practice that has developed in the hearings division to ascertain that appeals filed (most commonly by unrepresented claimants, but occasionally by represented parties) are properly and timely provided to the other party or parties.

Proposed new §143.3(c) describes a practice that has developed which addresses how the commission treats requests for review by the appeals panel, which are filed by parties on a "conditional" basis. Occasionally, a party who has received a decision that is generally favorable will file a request for review that the party only wants considered in the event the other party files a request for review. The proposed provision makes it clear that the appeals panel will not consider such a filing as an appeal unless a timely request for review is received from the other party. In the event the other party does file a timely request for review, the appeals panel will treat the conditional appeal as the second appeal received and label it as the cross-appeal in the case. If no timely request for review is filed by the other party, the decision of the hearing officer becomes final.

Proposed new §143.3(d)(1)-(4) incorporates the rules that the commission uses to determine the date of receipt of the hearing officer's decision in order to calculate the timeliness of an appeal. Because there has been some confusion regarding the application of the provisions of Chapter 102 of the commission rules to the receipt of a hearing officer's decision, the proposal provides the relevant information within this rule to be more clear and user-friendly for all parties.

The addition of §143.3(f) is proposed to incorporate legislation enacted by the 77th Texas Legislature. House Bill 2600 amended Texas Labor Code, §410.202(d) to expressly exclude Saturdays and Sundays and holidays listed in Section 662.003, Texas Government Code from the computation of the time in which a request for appeal under §410.202(a) or a response under §410.202(b) must be filed. This rule incorporates the statutory language to provide consistent guidance to parties seeking to appeal. This proposed amendment to the rule is not a change from how the commission has interpreted the rules in conjunction with the statute since June 17, 2001, the effective date of the provision. Adding this statutory language to the rule makes the information more easily available to system participants. The appeals panel has noted numerous errors in calculation resulting from parties consulting the rule without reviewing the statute. It should be noted that these were the only time computation provisions that were addressed in this regard by HB 2600. The statute did not exclude Saturdays, Sundays, or Section 662.003 holidays from the computation of the 30 days for the appeals panel to issue its written decision, or from the computation of the 41st day after the date the appeal decision is filed or deemed filed with the director of the hearings division.

The proposed amendments to §143.4(a)(3) and (5), and §143.4(b) and (d) parallel the proposed provisions for §143.3(a)(3) and (5), §143.3(b) and (f) and pertain to responses to appeals.

The proposed amendments to §143.5(a) incorporate legislation enacted by the 77th Texas Legislature. House Bill 2600 amended Texas Labor Code, §410.204(d) to require the true corporate name of the insurance carrier and the name and address of its registered agent for service of process be included in a separate paragraph in each final decision of the appeals panel. Although this is currently being done in compliance with the statute, the amended rule would now incorporate the statutory language.

Proposed amendment to §143.5(d) updates the citation to the Texas Workers' Compensation Act to reflect its location in the Texas Labor Code.

Heidi Jackson, Director of the Hearings Division, has determined that for the first five year period the proposed rule amendments are in effect there will be no fiscal implications for state government as a result of enforcing or administering the proposed rule amendments. None of the proposed amendments place a duty or requirement on the commission that is not already in place by statute or through existing practice by the commission.

There will be no fiscal implications for local governments with respect to enforcing or administering the proposed rule amendments, as local government has no regulatory role in the rule amendments as proposed.

Local government and state government as covered regulated entities will be impacted in the same manner as described later in this preamble for persons required to comply with the rule amendments as proposed.

Ms. Jackson has also determined that for each year of the first five years the rules as proposed are in effect, public benefits anticipated as a result of enforcing the rules include the clarification of matters that could potentially cause confusion to system participants. These amendments make no change to the substance of the rules.

None of the proposed amendments place a duty or requirement on a party that is not already in place by statute or through current commission rules. The clarification regarding receipt by the commission Central Office will not impose any additional cost on any party. There will be no anticipated costs to persons who are required to comply with the rules as proposed. There will be no costs of compliance for small or large businesses as a result of the proposed changes. There will be no adverse economic impact on small businesses or micro-businesses.

Comments on the proposal or requests for public hearing must be received by 5:00 p.m. on February 2, 2004. You may comment via the Internet by accessing the commission's website at www.twcc.state.tx.us and then clicking on "Proposed Rules." This method for the submission of comments will help you organize your comments by rule chapter. You may also comment by emailing your comments to rulecomments@twcc.state.tx.us or by mailing or delivering your comments to Linda Velasquez at the Office of the General Counsel, Mail Stop 4-D, Texas Workers' Compensation Commission, 7551 Metro Center Drive, Suite 100, Austin, TX 78744..

Commenters are requested to clearly identify by number the specific rule and paragraph commented upon. The Commission may not be able to respond to comments that cannot be linked to a particular proposed rule. Along with your comment, it is suggested that you include the reasoning for the comment in order for Commission staff to fully evaluate your recommendations.

Based upon various considerations, including comments received and the staff's or Commissioners' review of those comments, or based upon the Commissioners' action at the public meeting, the rule as adopted may be revised from the rule as proposed in whole or in part. Persons in support of the rule as proposed, in whole or in part, may wish to comment to that effect.

The amendments are proposed under Texas Labor Code, §402.061, which authorizes the Commission to adopt rules necessary to administer the Act; Texas Labor Code, Chapter 410, Subchapter E, which sets out the requirements, powers, and duties of the appeals panel and the procedures for appeals panel review; and Texas Government Code §662.003 which sets out holidays recognized by the state of Texas for government offices.

No other code, statute, or article is affected by the amendments proposed by this rule action. The amendments are proposed under the Texas Labor Code §§402.061, 410.201-410.209 and Texas Government Code §662.003.

§143.1.Definitions.

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise.

(1) Appellant--A party to a benefit contested case hearing who is dissatisfied with the decision of the hearing officer, and files a request for review of that decision by the appeals panel.

(2) Request--The appellant's written appeal for review of the decision of a hearing officer.

(3) Respondent--The other party to a benefit contested case hearing who must file a response to the appellant's request.

(4) Response--The respondent's written answer to the appellant's request.

[ (5) Served on (a party)--Presented to a party in person, or mailed by certified mail, return receipt requested. ]

§143.3.Requesting the Appeals Panel to Review the Decision of the Hearing Officer.

(a) A party to a benefit contested case hearing who is dissatisfied with the decision of the hearing officer may request the appeals panel to review that decision. The request shall:

(1) be in writing;

(2) clearly and concisely rebut each issue in the hearing officer's decision that the appellant wants reviewed, and state the relief the appellant wants granted;

(3) be filed with the Chief Clerk of Proceedings in the commission's central office in Austin not later than the 15th day after receipt of the hearing officer's decision . Requests that are timely submitted to a commission location other than the Chief Clerk of Proceedings, such as a local field office of the commission, will be considered timely filed and forwarded to the commission's appeals panel for consideration, but this may result in delay in the processing of the request. Untimely requests, regardless of whether they are filed with the Chief Clerk of Proceedings in the commission's central office or in a different commission office, do not invoke the jurisdiction of the appeals panel and will not be reviewed by the appeals panel ; [ and ]

(4) be served on the other party on the same day filed with the commission ; and [ . ]

(5) contain a statement certifying that a copy has been served on the other party or parties in person, or mailed by certified mail, return receipt requested. A certificate in substantially the following form shall be used: "I hereby certify that I have on this ____ day of ____________, _____ , served a copy of the attached request for appeal on _______________________________ (state the name of the other party or parties on whom a copy was served) by _______________________________ (state the manner of service)." _______________________________ Signature

(b) If it is not clear from the request for review that the party has properly served a copy of the request on the other party or parties, the hearings division shall attempt to contact the other party or parties and, if the contact indicates that the other party or parties have not received a copy of the request, provide a copy of the request expeditiously. [ The request shall contain a statement certifying that a copy has been served on the other party. A certificate in substantially the following form shall be used; "I hereby certify that I have on this ____ day of _____, ____, served a copy of the attached request for appeal on ______________ (state the name of the other party on whom a copy was served) by _________________ (state the manner of service)." ______________________Signature ]

(c) A party may make a conditional request for review by the appeals panel even if the overall contested case hearing decision is favorable to that party. A timely request that indicates that the filing party seeks consideration only if the opposing party files a request for review will not be treated as a request for review unless an opposing party timely files a request. If an opposing party does file a timely request, the conditional request will be treated as a cross-appeal.

(d) The commission shall deem that the parties received the hearing officer's decision:

(1) five days after the date the commission's letter was mailed to the parties, unless the great weight of evidence indicates otherwise;

(2) the first working day after the date the written communication was placed in a carrier's Austin representative box located at the commission's main office in Austin unless the great weight of evidence indicates otherwise;

(3) the working day that it was faxed by the commission, if faxed during normal business hours as defined in §102.3(c); otherwise, the next working day after the date faxed; or

(4) the working day that it was electronically transmitted by the commission, if transmitted during normal business hours as defined in §102.3(c); otherwise, the next working day after the date electronically transmitted.

(e) [ (c) ]A request made under this section shall be presumed to be timely filed or timely served if it is:

(1) mailed on or before the 15th day after the date of receipt of the hearing officer's decision, as provided in subsection (a) of this section; and

(2) received by the commission or other party not later than the 20th day after the date of receipt of the hearing officer's decision.

(f) Saturdays and Sundays and holidays listed in Section 662.003, Government Code, are not included in the computation of the time in which a request for an appeal must be filed.

§143.4.Responding to a Request for Review by the Appeals Panel.

(a) The other party shall respond to the appellant's request. The response shall:

(1) be in writing;

(2) clearly and concisely support each issue in the hearing officer's decision that the appellant has rebutted in the request, and state why the appellant's relief should not be granted;

(3) be filed with the Chief Clerk of Proceedings in the commission's central office in Austin not later than the 15th day after the request was received by the respondent . Responses that are timely submitted to a commission location other than the Chief Clerk of Proceedings, such as a local field office of the commission, will be considered timely filed and forwarded to the commission's appeals panel for consideration, but this may result in delay in the processing of the response. Untimely responses, regardless of whether they are filed with the Chief Clerk of Proceedings or in a different commission office, will not be reviewed by the appeals panel ; [ and ]

(4) be served on the appellant on the same day filed with the commission ; and [ . ]

(5) contain a statement certifying that a copy has been served on the other party or parties in person, or mailed by certified mail, return receipt requested. A certificate in substantially the following form shall be used: "I hereby certify that I have on this ____ day of ____________, _____ , served a copy of the attached response to a request for appeal on _______________________________ (state the name of the other party or parties on whom a copy was served) by _______________________________ (state the manner of service)." _______________________________ Signature

(b) If it is not clear from the response that the party has properly served a copy of the response on the other party or parties, the hearings division shall attempt to contact the other party or parties and, if the contact indicates that the other party or parties have not received a copy of the response, provide a copy of the response expeditiously. [ The response shall contain a statement certifying that a copy has been served on the appellant. A certificate in substantially the following form shall be used: "I hereby certify that I have on this ____ day of ____________, _____ , served a copy of the attached response on _______________________________ (state the name of the appellant on whom a copy was served) by _______________________________ (state the manner of service)." _______________________________ Signature ]

(c) A response made under this section shall be presumed to be timely filed or timely served if it is:

(1) Mailed on or before the 15th day after the date receipt of the appellant's request, as provided in subsection (a) of this section; and

(2) received by the commission or other party not later than the 20th day after the date of receipt of the appellant's request.

(d) Saturdays and Sundays and holidays listed in Section 662.003, Government Code, are not included in the computation of the time in which a response must be filed.

§143.5.Decision of the Appeals Panel.

(a) Not later than the 30th day after the date the response was filed with the commission, the appeals panel will issue its written decision, concluding with a separate paragraph stating words to the effect: "The true corporate name of the insurance carrier is (NAME IN BOLD PRINT) and the name and address of its registered agent for service of process is (NAME AND ADDRESS IN BOLD PRINT)", and file a copy with the director of the hearings division.

(b) If the appeals panel does not issue a written decision by the 30th [ thirtieth ] day after the date the response was filed with the commission, the hearing officer's decision becomes final, constitutes the decision of the appeals panel, and, for the purpose of establishing the time for seeking judicial review, is deemed filed with the director of the hearings division on that day.

(c) Not later than the seventh day after the appeals panel files its decision with the director of the hearings division, or a decision is deemed filed, as provided in subsection (b) of this section, the division shall send to each party a copy of the decision, or a notice that the hearing officer's decision has become final and constitutes the decision of the appeals panel.

(d) A decision of the appeals panel that is not appealed for judicial review, as provided by the Texas Labor Code §410.251, et seq., [ Workers' Compensation Act, §§6.61 et seq., ] becomes final on the 41st day after the date the decision was filed, or deemed filed, with the director of the hearings division. Failure to comply with a final decision or order within 20 days of its becoming final is a Class A administrative violation, with a penalty not to exceed $10,000.

(e) A decision of the appeals panel that is appealed for judicial review is binding on the parties for the duration of the judicial review.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 19, 2003.

TRD-200308704

Susan Cory

General Counsel

Texas Workers' Compensation Commission

Earliest possible date of adoption: February 1, 2004

For further information, please call: (512) 804-4287