Shown verbatim: the complete text as captured from the official page posted by the Hawaii State Legislature, fetched 2026-08-29. Where this bill amends existing law, language marked for deletion in the official page appears here in brackets. This is the first conference draft. The official bill page.
HOUSE OF REPRESENTATIVES H.B. NO. 1514 THIRTY-THIRD LEGISLATURE, 2026 H.D. 2 STATE OF HAWAII S.D. 1 C.D. 1 A BILL FOR AN ACT RELATING TO WORKERS' COMPENSATION. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII: SECTION 1. The legislature finds that early intervention is vital to ensure the efficient and effective rehabilitation of employees who suffer a work-related injury. This often begins with the referral of an injured employee for vocational rehabilitation services. Vocational rehabilitation services are intended to help the employee return to work as quickly as possible with pay as close as possible to pre-injury wages. Urgency is needed when initiating the vocational rehabilitation process to avoid prolonged adverse effects on injured employees and minimize costs for employers and insurers. The legislature further finds that it is crucial for injured employees to have access to appropriate vocational rehabilitation services in the State. Many vocational rehabilitation providers have expressed concern regarding the future availability of services as providers retire or leave the practice. It is important for current and future providers to be properly trained on the vocational rehabilitation process. Accordingly, the purpose of this Act is to: (1) Clarify the process for selecting a certified provider of vocational rehabilitation services; (2) Require a provider to automatically approve an injured employee for vocational rehabilitation services if the provider determines that the injured employee will likely require vocational rehabilitation services to return to suitable gainful employment; and (3) Clarify the process for an employer to object to a vocational rehabilitation plan. SECTION 2. Section 386-25, Hawaii Revised Statutes, is amended to read as follows: "§386-25 Vocational rehabilitation. (a) The purposes of vocational rehabilitation are to restore an injured worker's earnings capacity as nearly as possible to that level that the worker was earning at the time of injury and to return the injured worker to suitable gainful employment in the active labor force as quickly as possible in a cost-effective manner. Vocational rehabilitation shall not be available for public employees who have retired from a public employer, as defined in section 76-11, with whom they sustained their work injury. Employees of public employers, as defined in section 76-11, who are eligible for their respective public employer's return to work program, shall participate in and complete the return to work program, including temporary light duty placement efforts, as a prerequisite to vocational rehabilitation benefits under this section. (b) The director may refer employees who may have or have suffered permanent disability as a result of work injuries and who, in the director's opinion, can be vocationally rehabilitated to the department of human services or to private providers of rehabilitation services for vocational rehabilitation services that are feasible. A referral shall be made upon recommendation of the rehabilitation unit established under section 386-71.5 and after the employee has been deemed physically able to participate in rehabilitation by the employee's attending physician. The unit shall include appropriate professional staff and shall have the following duties and responsibilities: (1) To review and approve vocational rehabilitation plans developed by certified providers of vocational rehabilitation services, whether they be private or public; (2) To adopt rules consistent with this section that shall expedite and facilitate the identification, notification, and referral of industrially injured employees to vocational rehabilitation services, and establish minimum standards for providers providing vocational rehabilitation services under this section; (3) To certify private and public providers of vocational rehabilitation services meeting the minimum standards established under paragraph (2); and (4) To enforce the implementation of vocational rehabilitation plans. (c) Enrollment in a vocational rehabilitation plan or program shall not be mandatory and the approval of a proposed vocational rehabilitation plan or program by the injured employee shall be required. [The] If the injured employee elects to enroll in a vocational rehabilitation plan or program, the injured employee [may] shall select a certified provider of vocational rehabilitation services[. Both] no later than thirty days after the referral is made. Once the injured employee selects a certified provider, both the certified provider and the injured employee[, within a reasonable time after initiating rehabilitation services,] shall give proper notice of selection to the employer[.] within seven days. If the injured employee fails to select a certified provider within thirty days, the employer shall select a certified provider of vocational rehabilitation services and give proper notice of selection to the injured employee. (d) A provider shall submit an initial evaluation report of the employee to the employer and the director within forty‑five days of the date of referral or selection. The evaluation shall determine whether the employee requires vocational rehabilitation services to return to suitable gainful employment, identify the necessary services, and state whether the provider can provide these services. The initial evaluation report shall contain: (1) An assessment of the employee's: (A) Current medical status; (B) Primary disability; (C) Secondary disability; (D) Disabilities that are not related to the work injury; and (E) Physical or psychological limitations, or both. If this information is not provided by the treating physician within a reasonable amount of time, information from another physician shall be accepted; (2) A job analysis addressing the demands of the employee's employment; (3) A statement from the provider identifying the employee's vocational handicaps in relation to the employee's ability to: (A) Return to usual and customary employment; and (B) Participate in and benefit from a vocational rehabilitation plan or program; (4) A statement from the provider determining the feasibility of vocational rehabilitation services, including: (A) The provider's ability to assist the employee in the employee's efforts to return to suitable gainful employment; (B) An outline of specific vocational rehabilitation services to be provided, justification for the necessity of services, and how the effectiveness of these services is measured; and (C) How the vocational rehabilitation services directly relate to the employee obtaining suitable gainful employment; and (5) The enrollment form and the statement of worker's rights and responsibilities form obtained from the department. (e) A provider shall automatically approve vocational rehabilitation services for an injured employee; provided that the provider determines that the injured employee will likely require vocational rehabilitation services to return to suitable gainful employment, and the initial evaluation report finds the injured employee feasible to participate. [(e)] (f) A provider shall file the employee's vocational rehabilitation plan with the approval of the employee[.] no later than one hundred twenty days after the provider submits an initial evaluation report; provided that the director may grant an extension in the director's discretion. Upon receipt of the vocational rehabilitation plan from the provider, an employee shall have ten days to review and sign the vocational rehabilitation plan. The vocational rehabilitation plan shall be submitted to the employer and the employee and be filed with the director within two days from the date of the employee's signature. A vocational rehabilitation plan shall include a statement of the feasibility of the vocational goal, using the process of: (1) First determining if the employee's usual and customary employment represents suitable gainful employment, and, should it not; (2) Next determining if modified work or other work with the same employer represents suitable gainful employment, and, should it not; (3) Next determining if modified or other employment with a different employer represents suitable gainful employment, and [finally], should it not; (4) Then providing training to obtain employment in another occupational field. When training to obtain employment in another occupational field is required, the first appropriate option among the following options shall be selected for the employee: (A) On-the-job training; (B) Short-term retraining program (less than fifty‑two weeks); or (C) Long-term retraining program (more than fifty-two weeks); and (5) [Lastly, if] If training under paragraph (4) is not feasible, then self-employment may be considered. [(f)] (g) A vocational rehabilitation plan may be approved by the director; provided that the vocational rehabilitation plan includes: (1) A physician's assessment of the employee's physical limitations, psychological limitations, and ability to return to work. If this information is not provided by the treating physician within a reasonable amount of time, information from another physician shall be accepted; (2) A labor market survey indicating there are reasonable assurances that the proposed occupation for which the employee is to be placed or trained is readily available in the community when placement begins, or there are assurances of reemployment by the employer; (3) A job analysis of the proposed occupation, setting forth its duties, responsibilities, physical demands, environmental working conditions, specific qualifications needed for entry-level employment, reasonable accommodations, expected estimated earnings, and other relevant information; (4) The nature and extent of the vocational rehabilitation services to be provided, including: (A) Specific services to be provided; (B) Justification for the necessity of the services; (C) Estimated time frames for delivery of services; (D) The manner in which the effectiveness of these services is to be measured; (E) Criteria for determining successful completion of the vocational rehabilitation plan; and (F) The employee's responsibilities; (5) A report of tests and copies thereof that have been administered to the employee, including a statement regarding the need for and use of the tests to identify a vocational goal; (6) If retraining, including on-the-job training, is found to be necessary, the estimated cost of retraining, a description of specific skills to be learned or knowledge acquired with specific time periods and clearly defined measurements of success, and the nature, amount, and duration of living expenses; (7) The total cost of the vocational rehabilitation plan; and (8) The employee's approval of the vocational rehabilitation plan. [(g)] (h) The employer shall have ten calendar days from [the postmark date on which the plan was mailed] the receipt of the vocational rehabilitation plan to submit in writing to the director any objections to the vocational rehabilitation plan. A vocational rehabilitation plan shall be deemed received by an employer when it is transmitted with reasonable evidence of receipt. [(h)] (i) The director may approve a vocational rehabilitation plan that does not include all of the requirements outlined in subsection [(f);] (g); provided that the director finds the vocational rehabilitation plan: (1) Is in the best interest of the employee; (2) Contains reasonable assurances that the employee will be placed in suitable gainful employment; and (3) Has been approved by the employee. [(i)] (j) If the vocational rehabilitation plan requires the purchase of any tools, supplies, or equipment, the purchase deadline shall be included in the vocational rehabilitation plan. Tools, supplies, and equipment shall be considered to be the property of the employer until the vocational rehabilitation plan is determined by the director to be successfully completed, after which it shall become the property of the employee. If the vocational rehabilitation plan requires the purchase, [etc.,] the employer shall purchase the items [prior to] before the purchase deadline in the vocational rehabilitation plan. [(j)] (k) An employee with an approved vocational rehabilitation plan who is determined as able to return to usual and customary employment may choose to complete the vocational rehabilitation plan or request a new vocational rehabilitation plan of which the goal may be the employee's usual and customary employment. [(k)] (l) An injured employee's enrollment in a vocational rehabilitation plan or program shall not affect the employee's entitlement to temporary total disability compensation if the employee earns no wages during the period of enrollment. If the employee receives wages for work performed under the vocational rehabilitation plan or program, the employee shall be entitled to temporary total disability compensation in an amount equal to the difference between the employee's average weekly wages at the time of injury and the wages received under the vocational rehabilitation plan or program, subject to the limitations on weekly benefit rates prescribed in section 386-31(a). The employee shall not be entitled to temporary total disability compensation for any week during this period where the wages equal or exceed the average weekly wages at the time of injury. [(l)] (m) The director shall adopt rules for additional living expenses necessitated by the vocational rehabilitation plan or program, together with all reasonable and necessary vocational training. [(m)] (n) If the rehabilitation unit determines that vocational rehabilitation is not possible or feasible, it shall certify the determination to the director. [(n)] (o) Except as otherwise provided, determinations of the rehabilitation unit shall be final unless a written request for reconsideration is filed with the rehabilitation unit within ten calendar days of the date of the determination. The rehabilitation unit shall issue a reconsideration determination to affirm, reverse, or modify the determination or refer the request for reconsideration for hearing. [(o)] (p) A reconsideration determination shall be final unless a written request for hearing is filed within ten calendar days from the date of the reconsideration determination. All hearings shall be held before a hearings officer designated by the director. A written decision shall be issued in the name of the director. [(p)] (q) The eligibility of any injured employee to receive other benefits under this chapter shall in no way be affected by the employee's [entrance upon a course of] enrollment in a vocational rehabilitation plan or program as [herein] provided[.] in this section. [(q)] (r) Vocational rehabilitation services for the purpose of developing a vocational rehabilitation plan may be approved by the director and the director may periodically review progress in each case." SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored. SECTION 4. This Act shall take effect on July 1, 2026.
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