Workers’ Comp Bills Undercutting Reforms Stopped; Helpful Proposals Become Law

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1Action taken earlier this month by Governor Edmund G. Brown Jr. on two bills closed out another successful legislative year in workers’ compensation for the California Chamber of Commerce.

Introduced in the Legislature, but not passed, was a proposal that threatened to undercut the recent reforms and expand benefits to individuals not injured on the job.

Also introduced and ultimately signed into law were two CalChamber-supported bills that will provide appropriate, less costly and timely care, and ensure all injured workers have access to benefits.

Jeremy Merz highlights features of positive workers’ compensation legislation signed into law and a harmful bill that was vetoed.

 

Job Killer Stopped

The CalChamber opposed SB 563 (Pan; D-Sacramento) and designated it a job killer because it would have undermined the entire medical treatment review process in the California workers’ compensation system, thereby triggering significant system cost increases and exposing injured workers to delays and potentially inappropriate treatment.

The medical review process—including both utilization review and independent medical review—was updated as part of the joint labor-management system reforms in 2012.

The goals of these updates were to:

• ensure timely, evidence-based treatment for injured workers;

• allow physicians, not judges, to make medical decisions; and

• reduce system litigation and friction.

SB 563 threatened to obstruct each of these goals by creating ambiguous exceptions to the review process, each of which would have resulted in more treatment delays and disputes.

SB 563 was held in the Senate Appropriations Committee.

Vetoed

The CalChamber also opposed AB 305 (Gonzalez; D-San Diego), which would have required employers to compensate some injuries that occurred outside of the workplace.

The California workers’ compensation system was designed to cure and relieve industrial injuries or, more simply put, injuries that occur at work. Therefore, when making permanent disability determinations, physicians may apportion between industrial (workplace) and nonindustrial (outside the workplace) causes of the disability.

AB 305 would have eliminated apportionment for certain conditions, thereby expanding workers’ compensation beyond industrial injuries. The CalChamber worked with coalition partners to stop this bill and it was vetoed by the Governor on October 6.

Positive Outcome

Collectively, the actions taken on the following bills by both the Governor and the Legislature were positive for the workers’ compensation system and California employers.

AB 1124 (Perea; D-Fresno) creates a prescription medication formulary that will ensure clinically appropriate medications are provided to injured workers and potentially decrease dispute-driven procedural delays and reduce costs in the workers’ compensation system.

Formularies have proven successful in managing pharmaceutical costs in other health systems—including Medi-Cal, private group health care and other state workers’ compensation systems.

The CalChamber worked with the author’s office and other system stakeholders to develop the language in the bill, and it was signed into law on October 6.

SB 623 (Lara; D-Bell Gardens) clarifies current law to ensure that no injured worker is refused benefits from the Uninsured Employers Benefit Trust Fund (UEBTF) and the Subsequent Injuries Benefit Trust Fund (SIBTF) based on the worker’s immigration status.

The UEBTF provides workers’ compensation benefits to injured workers who have been injured on the job and work for an illegally uninsured employer. The SIBTF is a source of additional compensation for injured workers who already had a disability or impairment at the time of injury.

The CalChamber supported SB 623, along with the California Labor Federation and the California Applicants’ Attorneys Association, and it was signed by the Governor on September 9.

Staff Contact: Jeremy Merz

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Jeremy Merz
About Jeremy Merz
Jeremy Merz specialized in workers’ compensation, taxation, privacy, transportation and infrastructure issues while a CalChamber policy advocate from December 2011 through December 2016. He now is vice president, state affairs – western region at the American Insurance Association. Merz came to the CalChamber from Downey Brand, LLP, where he represented private defendants in state and federal courts on business litigation, employment law and workers’ compensation litigation. He earned a B.A. in economics from the University of California at Davis and a J.D. with distinction from the McGeorge School of Law, University of the Pacific, where he served on the editorial board of the McGeorge Law Review.