Clearing The Air
Mar 30, 2016

LEAD STORY

The Occupational Safety and Health Administration (OSHA) issued a final rule to curb lung cancer and kidney disease in America's workers by limiting their exposure to crystalline silica. It has been forty-five years since OSHA addressed permissible exposure limits (PEL) of silica. Nationwide, some 2.3 million industrial workers who cut, crush, or grind silica-containing materials (such as concrete and stone) are exposed to respirable crystalline silica in their workplaces.

CUT IN HALF

In this final rule, OSHA cut the prior permissible exposure limit in half — to 50 micrograms per cubic meter of air, averaged over an 8-hour shift. The new standard will phase in over the next several years. Construction industry worksites will have until June 23, 2017, to comply. General industry, maritime, and fracking (except the engineering controls) employers will have until June 23, 2018, or two years after the effective date to become compliant.

IMPACT

OSHA estimates that the rule will save over 600 lives, prevent more than 900 new cases of lung cancer, and provide net benefits of about $7.7 billion annually, once it is fully implemented. We'll continue to follow this issue as industry comes into compliance with OSHA's final rule.

UNFORMITY OF DATA BREACH STANDARDS

NAIC CYBERSECURITY MODEL ACT

The National Association of Insurance Commissioners' (NAIC) Cybersecurity Task Force accepted comments on its proposed Model Law, aiming to alleviate a patchwork of state standards for data security, investigation, and notification of a data security incident. The Model Law, if enacted, would apply to all state licensed insurers and producers. The Cybersecurity Task Force will continue to work with stakeholders to prepare the Model Law for approval by the NAIC as a whole. It would then be up to each state legislature to decide whether to enact or amend the Model Law.

WHAT WOULD IT DO?

The Model Law seeks to smooth out several state-by-state wrinkles in data breach requirements. For example, it would require insurance companies to implement a Written Information Security Program (WISP) and impose board of director oversight for their own organization's WISP compliance and for the third-party service providers they employ. The Model Law would also impose a uniform breach notification standard, including a five-day breach reporting period to the state insurance commissioner. The licensed insurance entity would also provide notice (with draft approval by the insurance commissioner) to all affected consumers within sixty days of identifying the breach. Licensees must also offer to pay for at least 12 months of identity theft protection for affected consumers. The Task force will be discussing the Model Law at the NAIC Spring Conference and working toward approval by the next legislative session.

MAKING OUR WAY AROUND THE COUNTRY

ARIZONA

Speaking of the NAIC model laws, Arizona Governor Doug Ducey signed into law an NAIC Model Law (H.B. 2188) calling for greater scrutiny of insurer solvency. This new Arizona measure now requires insurers or insurance groups to annually assess and report their solvency through the completion of an "Own Risk and Solvency Assessment" (ORSA). An ORSA will require insurance companies to issue their own assessment of their current and future risk through an internal risk self-assessment process, and it will allow regulators to form an enhanced view of an insurer's ability to withstand financial stress.

NEW YORK

After a one-year extension, mandatory electronic prescribing became effective March 27, 2016. New York medical practitioners will now be required to send all prescriptions to pharmacies electronically. More than 60,000 doctors in New York State have already switched to e-prescription. That said, the New York Department of Health acknowledges a number of exceptions to electronic reporting, particularly in the area of compounding. New York's e-prescription mandate is the first of its kind. We expect similar initiatives in other states will be on their way.

TEXAS

Although not in session this year, the Texas House of Representatives Committee on Business and Industry convened last week, signaling potential legislative activity when the Texas Legislature returns next January. The committee questioned state Insurance Department officials at length about employers who are now failing to provide coverage and continuing complaints about the state's designated-doctor program. We'll be watching Texas in 2017.

SPRING IS IN THE AIR (AND IN THEIR STEP)

The White House put a healthy spin on Monday's Easter Egg Roll, a traditional event dating back 138 years. From candy that actually cleans teeth, to the First Lady's Fun Run, to shooting hoops with Shaq, creating a culture of wellness and fitness was the goal of this year's Egg Roll. Good to see the White House following such effective enterprise risk and insurance principles.

RIMS 2016

Thank you for your readership. We greatly appreciate your feedback and support of The Way. We have begun work on several mid-session legislative updates, including our comprehensive Cloakroom Report, which we will be discussing at the RIMS Annual Conference in San Diego, April 10-13. If you are planning to attend the conference, please send a line to Greg McKenna or Cari Miller. Let's get together. 

As always, please connect with GB on LinkedIn and follow us on Twitter.

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