1. (a) The commission shall conduct Compliance Audits of the workers' compensation records of system participants and their agents for compliance with the Act and Rules.
2. (b) The commission may conduct such audit at the offices of a system participant, an agent, the commission or at any other location the commission deems appropriate During an audit, the commission may, at its discretion, utilize persons in addition to commission staff to provide additional expertise.

3. (c) The commission shall provide reasonable notice in advance of any audit. That notice shall:

   1. (1) be in writing;
   2. (2) be sent at least 10 calendar days before the audit is to be performed;
   3. (3) specify the information that must be made available;
   4. (4) list the name and telephone number of the audit coordinator; and,
   5. (5) specify the date, time, location, and conditions of the audit.

4. (d) The system participant being audited (auditee) shall designate a general contact person and a contact person at each relevant location to coordinate the audit. That contact person shall:

   1. (1) provide reasonable access to requested personnel and information;
   2. (2) respond to reasonable needs of auditors onsite or to inquiries by auditors; and,
   3. (3) be familiar with the system participant's procedures and recordkeeping systems related to the scope of the audit.
5. (e) System participants (which may include those who are not being audited but whose records are necessary to conduct an audit of another system participant), upon request, shall make available for review claim files and other workers' compensation records in the format specified by the commission.
6. (f) Initial findings of the audit will be provided in writing to the auditee.
7. (g) The auditee may prepare and file with the commission a management response to the initial findings. The response may include proposed corrective actions. If such a response is provided, the commission shall review the response and shall adjust its findings if deemed appropriate.
8. (h) Final audit reports may be published on the commission's Internet website and shall be redacted to not include any confidential claim file information and shall remain on the commission's website until a subsequent audit has taken place. The commission may, at its discretion, delay publishing the final audit report until a follow-up audit is performed and, should the subsequent audit find the auditee to have achieved standards, may choose to only publish the subsequent audit report. Such a delay will not be considered if the auditee fails to submit a management response that identifies appropriate corrective actions to be taken to achieve standards.
9. (i) The commission, should it deem it appropriate or upon request of a licensing or certification authority, shall provide the appropriate licensing or certification authority with a copy of all final audit reports (redacted in accordance with subsection (h) of this subsection) and the auditee's response to the final audit report, if any.
10. (j) To the extent permitted by the Act and/or rule, the commission shall submit a bill to the auditee for the actual expenses associated with the audit, including audit staff time, additional expertise, travel and per diem expenses, and copying costs.
11. (k) The auditee shall submit payment by check, made payable to the order of the commission, for the expenses within 25 days after receipt of the bill. Payment may be delivered in person or by mail to the commission in Austin.

Source Note:The provisions of this §180.3 adopted to be effective July 29, 1991, 16 TexReg 3940; amended to be effective September 14, 2003, 28 TexReg 7711.