California workers and employers will soon be covered by a new set of worker’s compensation rules when the state’s governor signs a compromise agreement passed by both chambers of the legislature on Friday, into law later today.
The law which overhauls the state’s troubled worker’s compensation system with the intent of lowering worker’s compensation premiums for employers and providing greater benefits for workers with the most severe work-related injuries, is set to dramatically change both medical treatment and disability benefits.
Included in the law, which will become effective immediately upon signing, are provisions that will do the following:
- Allow companies to create a pool of doctors from which an injured worker can choose for initial treatment of a work-related injury.
- Require an injured worker to see three doctors from the company-designated pool of doctors before they can seek an independent medical review.
- Establish uniform medical guidelines that doctors must follow in the assessment of a work-related injury and treatment of disability claims.
- Cap temporary disability payments at two years and use a medical review in the instance of a dispute.
- Provide greater benefits for severely-disabled workers while cutting the benefits awarded in some other situations.
- Allow all workers to seek immediate treatment rather than waiting for employer approval (currently workers with non-emergency injuries, including work-related back pain, may have to wait for approval from their employer before seeking treatment).
- Require treating doctors to evaluate what percentage of the injury resulted from a present work-related situation and what portion of the injury is attributable to other factors.
- Hold the employer liable only for the percentage of the injury deemed to be attributable to the current work situation.
- Permit state reimbursement for small businesses who make changes in the workplace to help an injured worker return to work (see the April 2004 issue of The Ergonomics Report for more information on how ergonomics fits into return-to-work).
- Prohibit the state from regulating insurance companies’ worker’s compensation premium rates.
- Require a review of the impact of the law on the state’s worker’s compensation rates.
In an article in the Sacramento Bee, Frank Neuhauser, a worker’s compensation expert from the University of California, said that the new worker’s compensation law should cut a little more than $4 billion in costs. The governor had initially demanded that the law cut over $11 billion in costs.
Sources: Sacramento Bee; San Jose Mercury News; Associated Press