California Workers’ Compensation Bill Leads to Debate

The workers’ compensation system in California is a very complex process. While it tries to take into account every possible contingency in such a way as to balance workers’ rights and need for quick access to benefits with employers’ need for a way to predict workers’ compensation expenses, from time to time the system will need a major overhaul to keep it up-to-date with changing times and economic conditions.

to-sign-a-contract-3-1221952-mTo this end, California state legislators and Governor Jerry Brown passed a piece of legislation, which provided for somewhat sweeping changes to the state’s workers’ compensation act about three years ago. Many saw these changes as favoring employers and insurance companies, causing a disadvantage to providers of medical care for injured workers and rehabilitation providers, and, in turn, harming many disabled workers, even though it was designed to provide more cash benefits to workers.

Since the bill was enacted, there have been reports of a five percent drop in medical claims associated with workers’ compensation petitions. This has undoubtedly upset medical providers around the state, and they have pushed for new changes to the state workers’ compensation act. A newly proposed piece of legislation entitled Senate Bill 563 aims to address their concerns. According to a recent article in the Sacramento Bee, State Senator Richard Pan, a physician himself, wishes to take away some of the teeth from the utilization review required to approve any medical treatments as absolutely necessary prior to awarding disability benefits to pay for those medical treatments.

As our Orange County employment lawyers understand, this bill went through the state senate approval process with support from many of the same people who fought to put the utilization process in effect in the first place. This seemingly surprising and abrupt change of position just three years later may be a reaction to political pressure or recognition of the economic consequences of the prior act. This legislation is also supported by the California Labor Federation.

Though, it should be noted, while doctors and labor unions may support these changes, not everyone wants to see them take effect. For example, the California Chamber of Commerce, which represents employers, is calling this new state senate bill a “job killer.” This organization is also claiming any weakening of the medical utilization process will undermine the very purpose of creating the system in the first place.

As of now, the president pro tem of the California state senate has not expressed his opinion of the proposed changes and has not said whether he will support the bill if placed before him to sign. It is also unclear if the state governor will sign the bill, since it could be seen as a significant undermining of the 2012 bill, which he pushed for and considers one of his more important accomplishments since taking office.

Reducing medical treatments in favor of paying for medical treatments has created a difficult political issue. Many workers who are injured would seemingly rather have cash in hand instead of payment for medical treatment and rehabilitation when they are struggling to make ends meet following an on-the-job injury or work-related illness. However, access to medical treatment may better increase their quality of life and get them back to work sooner than a cash payment would.

Contact the employment attorneys at Nassiri Law Group, practicing in Orange County, Riverside and Los Angeles. Call 714-937-2020.

Additional Resources:

Opinion: Workers’ comp bill sparks new battle in California, May 12, 2015, The Sacramento Bee

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Dickson v. Burke Williams, Inc. – Failure to Prevent Harassment Alleged by Spa Worker, March 18, 2015, Orange County Gender Discrimination Lawyer Blog