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California workers' compensation bill faces difficulties

August 27, 2012|By Marc Lifsher

SACRAMENTO -- Advocates for low-income injured workers and the attorneys who represent them are furiously rejecting a proposed overhaul of the state's complex, costly workers' compensation insurance system.

"We oppose this last-minute rush to jam through workers' compensation legislation that further reduces disability compensation and access to medical care," said Jesse Ceniceros, president of VotersInjuredatWork.org.

The mammoth bill was negotiated behind closed doors over months by the California Labor Federation and large, self-insured employers, including Safeway Inc. and Walt Disney Co.

The 170-page bill was officially introduced in the state Legislature only late last Friday. Proponents argued that it provides about $700 million a year in new benefits to victims of on-the-job accidents. Money to pay for the boost would come out of an estimated $1 billion-plus in savings created by making the $16-billion system more efficient.

But an actuarial report released Monday that was commissioned by the administration of Gov. Jerry Brown questioned the level of predicted savings.

The Workers' Compensation Insurance Rating Bureau, a statistical agency financed by the insurance industry, concluded that savings generated by the overhaul would be only $400 million, which is $300 million less than the cost of the hike in benefits.

The rating bureau, however, cautioned that it lacked sufficient information, time and expertise to fully evaluate the costs of the proposed workers' compensation bill, SB 863 by Sen. Kevin de Leon (D-Los Angeles).

The proposal will be subject to an informational hearing in the Legislature on Tuesday morning. The bill to become law must be passed before the Legislature adjourns just before midnight Friday.

ALSO:

California Legislature sets ambitious agenda for last week of session

Brown backs overhaul of workers' compensation

Workers' comp deal faces fierce opposition

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