Calif. Gov, Leadership Closer On W.C. Bill

After Gov. Davis vetoed Senate Bill 71 in October of 2001–the third workers' comp bill he has vetoed in as many years?he pledged to work with legislators and other interested parties to cohesively devise a reform bill.

The National Association of Independent Insurers said it is reviewing the proposal and "looks forward to examining the cost-saving proposals to be added to the legislation next week."

Sam Sorich, vice president and western regional manager of Des Plains, Ill.-based NAII said he is "hopeful that the governor and legislative leaders can reach a reasonable agreement to head off a costly and divisive [workers' compensation benefits] ballot initiative."

He continued that meaningful workers' compensation legislation "must adequately balance any increase in benefits with cost-saving reforms."

Nicole Mahrt, director of public affairs for the American Insurance Association in San Diego, Calif., expressed concern, saying that the bill is "pretty much the same bill that was passed last year minus the retroactive benefit increases."

With this version, she said, the California economy "has a $3 billion hit instead of a $5 billion to $6 billion hit." AIA, she added, is concerned "because they're still not putting in the reforms that would save a lot of money and make the system more efficient. Insurers and employers are still not being given a seat at the table."

Ms. Mahrt said AIA is worried that the bill is "really moving fast" and that it is "unlikely that Davis will veto this measure. It could literally go to him by the end of the month."

"We're still trying for the chance to get something in there," she added. "We haven't given up hope. We'll aggressively lobby until the end."

California Assembly Insurance Committee Chairman Tom Calderon, D- Montebello, said Wednesday that the new benefits package, Senate Bill 1156, will be revised next week to include cost-saving measures proposed by Davis.

In a press release, Rep. Calderon said, "This is a critical time for negotiations. We are poised to put an initiative on the ballot if we do not receive the cooperation from all parties to ensure workers receive the benefits they deserve."

He continued that, "California is 49th in the nation in benefits provided to injured workers."

SB 1156, according to NAII spokesperson Heather Ryndak, includes language from Senate Bill 71, sponsored by Senator John Burton, D-San Francisco, and Assembly Bill 1176, sponsored by Rep. Calderon, as well as cost-saving measures outlined by Gov. Davis.

In a memo to the members of the California State Senate, Gov. Davis said he vetoed Senate Bill 71 because it does not contain some the goals necessary to improve the workers' comp system.

Those goals include promoting early and sustained return to work within the person's medical and work restrictions, implementing effective medical cost containment measures while assuring the quality of care provided and targeting benefit dollars to achieve the best outcome for injured workers.