Two years after California's latest workers' compensation act went into effect the measure is being praised for stabilizing the comp system and decried for causing irreparable harm to workers.
SB 899 was authored by State Senator Charles Poochigian, R-Fresno, and was signed into law by Gov. Arnold Schwarzenegger on April 19, 2004.
Among those speaking in praise of the measure is Ken Gibson, vice president of the Western region for the American Insurance Association. "What a difference two years and a major reform bill can make. California's workers' compensation system is stable, predictable and competitive," he said.
Mr. Gibson noted that cost savings resulting from SB 899 has led to an overall average rate reduction of 46 percent for workers' comp coverage. Additionally, he said the state's insurance commissioner, John Garamendi, "will consider yet another double-digit decrease at the end of this month."
Gov. Schwarzenegger also touted the "tremendously successful" reforms enacted under SB 899.
"It is lowering costs for business, especially for the small businesses that are the backbone of our economy, and it is making sure that injured workers get the quality care they deserve," he said.
Critics of the reforms have disputed that notion, however, arguing that SB 899 drastically cut benefits for injured workers and has only served to increase insurers' profits.
"Workers' compensation insurers are now earning record profits that can only be described as ludicrous," said Mark Hayes, president of the group VotersInjuredatWork.org. "Injured workers, however, are paying a high price as the lower rates and higher profits are far too often merely a direct reflection of benefit takeaways."
Mr. Hayes' group has argued that the reforms have cut benefits by as much as 70 percent, and have limited access to medical care for injured workers.
Insurers, business groups and other supporters have argued instead that the system prior to the enactment of reforms was far too subjective, with similar injuries resulting in significantly differing diagnoses and disability ratings.
State Senator Don Perata, D-Oakland, the president pro-tem of the state Senate, has introduced legislation that would restore benefits cut by SB 899, but supporters of the reforms have said they will fight any efforts to do so.
"I am fully committed to these reforms that have done so much good for our state, and I want to make it clear that I will oppose any efforts to hurt California's hardworking families and businesses by significantly rolling back reforms," said Gov. Schwarzenegger.
Much of the opposition to SB 899 has come from injured workers' advocacy groups and applicants' attorneys who represent injured workers, and Mr. Gibson turned their claims of insurers profiting from the system back upon them.
"The opponents of reform want to revert back to a broken system with loopholes that they could exploit and profit from," he said. "It is vital that attempts to undermine the reforms are stopped, or California's progress will become a distant memory."
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