Prop Zero
The Starting Point for Commentary and Coverage of California Politics

Is Another Workers' Comp Reform Coming?

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    NEWSLETTERS

    Workers compensation, particularly as it is practiced, is a complicated topic in California. It's also one we seem to revisit every decade or so. Why?

    Essentially, there are four major stakeholders in the workers' comp system: the insurers who sell workers' comp insurance coverage, the businesses that are required to get coverage, the injured workers who depend on workers' comp benefits (including the unions and attorneys who represent those workers), and the doctors and medical companies that provide care.

    A good rule of thumb: when two of those four constituencies are upset at the way things are going, the state sees a push for workers' comp reform.

    The last time California changed the rules on workers comp was in 2004. Then the aggrieved parties were insurance companies and businesses, including non-profits and local governments, who were paying the highest premiums in the country for workers' comp coverage. The insurers and businesses argued, successfully, that they were being gouged by massive fraud, supposedly committed by medical providers and workers. Enough medical providers and labor unions agreed that, under the threat of a ballot initiative, a bill passed.

    Six years later, the aggrieved parties are injured workers and medical providers who have found it difficult to get paid. But now, as the Sacramento Bee noted this week, they have a third leg of the four-legged stool joining them; insurers have seen a big decline in their premiums (for reasons that are disputed). Only businesses remain happy.

    Gov. Schwarzenegger is unlikely to sign new legislation changing rules, but he'll be out of office by next year. Keep an eye out then. If insurers, workers and medical providers come together behind legislation, California could see another workers comp reform in 2011.

    (/blogs/prop-zero) (/news/politics)