Penalty Program

The Penalty Program investigates and assesses penalties for violations of the Tennessee Workers’ Compensation Act other than those covered by the Uninsured Employers Fund (UEF) and the Employee Misclassification Education and Enforcement Fund (EMEEF). The Program enforces several penalties, including:

A 25% penalty for failure to pay or to timely pay temporary disability benefits; (If assessed, this penalty goes to the injured employee not to the Bureau.)
A potential penalty of up to $10,000 or more for failure to timely comply with a Specialist’s or Administrator’s Designee’s order (for injuries prior to July 1, 2014; capped at $5,000 for injuries on or after July 1, 2014); and
A penalty for an insurance company’s or self-insured employer’s failure to timely file claims forms; (Timely claims forms are important to the Bureau as the forms supply important claims information to the legislature for its consideration regarding changes to the Workers’ Compensation Act.)
Other various penalties.

A 25% penalty for failure to pay or to failure to timely pay temporary disability benefits assessed by the department is payable to the injured employee. All other penalties collected go to the Second Injury Fund (injuries prior to July 1, 2014) or to the Bureau's general fund (injuries on or after July 1, 2014).
To be considered timely and to avoid the noncompliance penalty, employers or their insurance carriers are required to comply with an Order for Benefits within fifteen (15) calendar days of its receipt, unless a request for an Appeal (for injuries prior to July 1, 2014) or Administrative Review (for injuries on or after July 1, 2014) is filed.

If an Appeal or Administrative Review is requested, the obligation to comply with the Order is suspended until the Appeal or Administrative Review is resolved.

To be considered timely and to avoid the noncompliance penalty, Employers or their insurance carriers are required to comply with the Board of Appeals or Administrative Review Order within ten (10) calendar days of receipt.
Continued failure to comply with an Order 21 days after its receipt may result in an additional penalty of $1,000.00 per day (injuries prior to July 1, 2014).

When determining whether or not a noncompliance penalty is appropriate, there is a “strict liability” standard applied. Either the employer or their insurance carrier timely complied with the Order, or it didn’t.

Summary of Workers’ Compensation Penalties

Penalties as of August 2018

Filter by Category

Category	Violation Type	Responsible Party	Length of Time Allotted	Penalty Amount

Non-compliance with Order TCA §50-6-238 (as to injuries prior to 7/1/14) Within 1 business day of notification of injury Failure by any party to comply with MIR Rules in a manner for which no penalty has specifically been set forth. Failure to timely pay benefits TCA §50-6-205 MEDICAL FEE SCHEDULE/MEDICAL COST CONTAINMENT VIOLATIONS MEDIATOR Violation of E-billing requirements Rule 0800-02-26 Failing to notify the employee and the authorized treating physician that the prescribed treatment was submitted to the utilization review agent. Failure to file First Report of Payment Rule 0800-2-01-.04 --- Denying or stop providing benefits without first performing a reasonable investigation Rule 0800-02-24-.05(1) Rendering excessive or inappropriate services. TCA 50-6-124 25% of unpaid/untimely paid benefit CLAIM FORMS Medical provider Carrier Failure to File SD-2 Rule 0800-02-14-.09 and TCA 50-6-244 7 business days of submission Failure to provide medical treatment made reasonably necessary by accident and recommended by ATP TCA 50-6-118 $250/$500 Employer 10 business days from date of compensation hearing order 30 calendar days after final pmt. of compensation Failure to notify carrier within 1 day of knowledge of injury Rule 0800-02-01-.05 Failing to include a copy of the current utilization review appeal form when the denial is forwarded to the employee and authorized treating physician. Rule 0800-02-06 Case management organization All parties MEDICAL: MIRR PENALTIES Failure to File Final Reports of Payment Rule 0800-2-14-.09 $100-$10,000 per violation $50-$5000 Non-compliance with Order TCA §50-6-239 (as to injuries on or after 7/1/14) Failure by an employer or insurer to pre-pay the evaluation fee. A physician may charge a $100.00 late fee. If the evaluation fee and/or late fee remains unpaid fifteen (15) calendar days following the date of evaluation, an additional $250.00 penalty is authorized. Failure by employer or insurance carrier to pay the cancellation fee of $300.00, an additional $250.00 penalty is authorized. If any portion of a fee or penalty remains unpaid after an additional thirty (30) calendar day period, an additional $500.00 penalty is authorized, and ongoing until paid. Rule 0800-02-20-.14 Failing to provide medical providers on a Form C-42 in a timely manner. Rule 0800-02-01-.06 Up to $10,000, + $1,000 per day Failure to file Notice of Denial Rule 0800-2-1-.07 and 0800-2-14-.04 Violation of Case Management Forms Requirements Rule 0800-02-07 Employer/Carrier or Medical Provider Knowingly, willfully and intentionally causing claim to be paid under health insurance Rule 0800-02-14 MIR Physician Failing to render a decision and serve a copy of a determination in writing on the employer, employee and authorized treating physician within 7 business days of the submission of the prescribed treatment. 30 days of procurement or renewal Violation of the Medical Cost Containment Program Rules, Medical Fee Schedule Rules, or the In-patient Hospital Fee Schedule Rules Rule 0800-02-18-.15 20 calendar days from date of knowledge of compensable $100 to $1,000 per violation $50-$5,000 per violation Failure to file proof of WC coverage Rule 0800-02-01-.04 Employer Carrier, Pool, or Self-Insured $100-$1,000 per violation Failing to comply within a reasonable time with a request of ombudsman Rule 0800-02-24-.05(1) Within 5 business days of denial Provider or Carrier Within 14 calendar days (EE missed more than 7 days) or 15th of following month (EE missed 7 days or fewer) MEDICAL: CASE MANAGEMENT VIOLATIONS 3 business days from notification Engaging in unauthorized communications with the MIR physician. $50 - $5,000 UR organization $50 to $5,000 per violation Violation of Case Management Rules Rule 0800-02-07 7 business days Employer, Carrier, Pool, Self-Insured or Employee ELECTRONIC MEDICAL BILLING VIOLATIONS Carrier, Pool, or Self-Insured MEDICAL: UTILIZATION REVIEW PENALTIES 15 calendar days Within 5 business days of first payment of benefits COURT/MEDICAL/TEMPS Failure to timely file First Report of Injury Rule 0800-2-14-.04 Employer, Carrier, Pool, or Self-Insured $100 per violation $100/$250/$500 Employer/Carrier, Pool, or Self-Insured Failing to provide a representative with authority to settle at mediation. Rule 0800-02-24-.05(1) $50- $5000 Arriving more than thirty minutes late to any scheduled mediation proceeding without previously notifying the mediator Rule 0800-02-24-.05(1) Failure by a MIR Registry physician to timely refund any unearned evaluation fee Case Manager $50-5000 Failure to attend a scheduled mediation Rule 0800-02-24-.05(1) Providing medical providers on a Form C-42 that the party knows, or has good reason to believe, will not provide treatment Rule 0800-02-24-.05(1) Failing to timely provide documents as required by statute or rule Rule 0800-02-24-.05(1) Failing to provide proper panel of medical providers on a Form C-42 in a timely manner. Rule 0800-02-24-.05 and 0800-02-01-.06

Penalty Program Rules

Need More Help?

If you have additional questions, please call 615-532-4812 or 800-332-2667 or contact us by email at wc.info@tn.gov. Find out about other available assistance programs by contacting an ombudsman.