I am a claims adjuster who handles workers' compensation claims. The state's workers' compensation laws, even after the reform, have created and perpetuated a system where applicant attorneys can make money on any case no matter how fraudulent and where doctors for both sides say what they are paid to say rather than what they think.
An employer can almost count on paying out $9,000 to settle a stress claim after firing an employee who wasn't doing his or her job. The sad part is that only a third of that money goes to the employee, and the rest goes to his attorney, his attorney's psychiatrist and internist, the insurance company's psychiatrist and internist and the insurance company's attorney.
Why don't the insurance firms take these fraudulent claims to court instead of settling?
First, it's too expensive to pay an attorney to build a defense. Second, the liberal construction clause of the Labor Code stacks the odds against the insurance company by ordering workers' comp judges to give the benefit of the doubt to the employee.
The state needs to decide whether it wants to continue to support such blatant fraud or stand up to the lobbyists that watered down the original reform laws.