Division of the Budget
Landon State Office Building Phone: (785) 296-2436
900 SW Jackson Street, Room 504 adam.c.proffitt@ks.gov
Topeka, KS 66612 Division of the Budget http://budget.kansas.gov
Adam C. Proffitt, Director Laura Kelly, Governor


February 14, 2024


The Honorable Sean Tarwater, Chairperson
House Committee on Commerce, Labor and Economic Development
300 SW 10th Avenue, Room 346-S
Topeka, Kansas 66612
Dear Representative Tarwater:
SUBJECT: Fiscal Note for HB 2776 by House Committee on Commerce, Labor and
Economic Development
In accordance with KSA 75-3715a, the following fiscal note concerning HB 2776 is
respectfully submitted to your committee.
HB 2776 would require that on and after July 1, 2024, any member of the National Guard
who is entitled to certain benefits would be subject to the procedures, benefits, and compensation
established by the Workers Compensation Act. The bill provides that the average weekly wage of
a member would be the member’s current military earnings, the amount of federal compensation
received would be deducted from the amount otherwise due from the State of Kansas, and that
before any claim is processed, the member must sign an authorization consenting the release of
any information pertaining to the federal compensation. The bill would require a 50.0 percent
reduction of any compensation benefit payable for permanent partial disability or permanent total
disability that the employee is eligible to receive under the Workers Compensation Act if the
employee receives retirement benefits under the federal Social Security Act. The bill lists
exceptions to the 50.0 percent reduction.
The bill would require a judicial determination of dependency regarding compensation
where death results from injury that would be paid to a dependent and raises the maximum amount
of compensation benefits from $300,000 to $500,000. The bill outlines when the compensation
benefits for dependents would be terminated. When death does not result from injury, the
minimum weekly payment for a permanent total disability would increase from $25 to $50 per
week and certain functional impairment requirements to the determination of permanent total
disability would be added. The bill would also increase the minimum weekly payment for
temporary total disability from $25 to $50 per week. The bill would provide that the loss of use
The Honorable Sean Tarwater, Chairperson
Page 2—HB 2776

of a scheduled member would be the percentage of functional impairment the employee sustained
on account of the injury. The bill would increase the employers’ maximum liability for permanent
total disability, temporary total disability, permanent or temporary partial disability, and
permanent partial disability and would require yearly adjustments to such maximum compensation
benefits beginning in 2027. The bill would also increase the evidentiary standard for future
medical treatment. The bill would limit proceedings for post-award medical benefits and create
the presumption that no costs or attorney fees would be awarded when requests for post-award
medical benefits are provided within 30 days.
The bill adds “sick, vacation or other paid time off” to the term “money” for purposes of
the average weekly wage and excludes the first week of employment from the calculation of the
employee’s average weekly wage if the employee worked less than the expected weekly schedule.
Certain benefits payments would be allowed to be paid using electronic funds transfers or payment
cards. An injured worker’s attorney would be notified of each payment. An employer would also
be responsible for reimbursement of reasonable expenses for overnight accommodations for
certain examinations. The bill would also increase the liability limit from $15 to $30 per day that
the employee was required to be away from their residence. The bill outlines procedures for
neutral healthcare examinations and the exchange of medical reports between parties. The
deadline for an employee to notify an employer of an injury would be increased from 20 to 30
calendar days from the injury or from ten to 20 days if the employee is no longer employed,
whichever is shorter. The bill would eliminate the three-year deadline for a claimant’s motion to
extend time for proceeding to avoid dismissal for lack of prosecution. Awards including future
medical treatment would be prohibited unless certain conditions are met. The would bill allow
digital recording of certain workers compensation hearings and allows the Workers Compensation
Fund to implead a principal that it believes should cover an injured worker’s benefits.
The Department of Administration estimates that enactment of the bill would increase
expenditures by $84,378 in FY 2025 and $166,256 in FY 2026 from fee funds due to increases is
workers compensation limits. The Department estimated temporary total disability changes would
result in approximately $61,408 in FY 2025 for three new claims, and an additional three claims
would be added the following fiscal year, making the FY 2026 total $122,816. For permanent
total disability, the Department estimates two new claims would be added at a cost of $20,470 for
FY 2025 and an additional $20,470 for two additional claims in FY 2026, for a total of $40,940 in
FY 2026. The Department states there are on average 11 unauthorized medical claims that reach
the $500 cap under current statute, which would be increased to $700 under the bill. As a result,
such claims would cost an additional $2,200 in FY 2025 and FY 2026. Per diem increases from
$15 to $30 under the bill would result in an additional $300 in FY 2025 and FY 2026 for
approximately 20 claims.
The Insurance Department indicates enactment of the bill would increase expenditures to
its fee funds by $8,857 to $15,943 in FY 2025 and beyond. The Department states that the National
Council on Compensation Insurance estimates an overall effect on the potential benefit increase
on workers compensation benefits costs of between 0.5 percent and 0.9 percent. In FY 2023, the
Workers Compensation Fund had benefit costs of $1,771,460.
The Honorable Sean Tarwater, Chairperson
Page 3—HB 2776

The Department of Labor indicates enactment of the bill would not have a fiscal effect on
the agency. Any fiscal effect associated with HB 2776 is not reflected in The FY 2025 Governor’s
Budget Report.

Sincerely,

Adam C. Proffitt
Director of the Budget


cc: Tamara Emery, Department of Administration
Matt Spurgin, Office of Administrative Hearings
Bobbi Mariani, Insurance Department
Dawn Palmberg, Department of Labor


Statutes affected:
As introduced: 44-501, 44-508, 44-510b, 44-510c, 44-510d, 44-510e, 44-510f, 44-511, 44-510h, 44-510k, 44-512, 44-515, 44-516, 44-519, 44-520, 44-523, 44-525, 44-526, 44-531, 44-534a, 44-552, 44-566a