Employee’s Right to Medical Privacy

There is a bill currently in evaluation at the North Carolina Legislature that if enacted, would allow your employer rights to certain medical records if you become disabled or filing for workers compensation.  The employer would not need the employee’s permission to access the records.  The text of the bill contains the following:

an employer is entitled, without the express authorization of the employee, to obtain medical records of the employee and communicate with an employee’s health care providers if the requested medical records, reports, and information are:
(1) Restricted to the particular evaluation, diagnosis, or treatment of the injury or disease for which compensation, including medical compensation, is sought;
(2) Reasonably related to the injury or diseases for which the employee claims compensation; or
(3) Related to an assessment of the employee’s ability to return to work or perform suitable employment as a result of the particular injury or disease.

Further it reads:

If the employee refuses to submit to or in any way obstructs the examination requested by and provided for by the employer, the employee’s right to compensation and right to take or prosecute any proceedings under this article shall be suspended immediately until the refusal or objection ceases and no compensation shall at any time be payable for the period of obstruction, unless in the opinion of the Industrial Commission the circumstances justify the refusal or obstruction

The full text of the bill may be read here.

What are your thoughts?   Is this a good check and balance to prevent worker compensation fraud?  Or is this overstepping the line for personal privacy?