|
Friends of the Fourth
District:
In late March, a group of State legislators held a special hearing
in Sacramento on aspects of California’s Workers Compensation
programs, that, while billed as ‘informational only’, might also be
the first act in a year-long drama around legislators either
protecting or rolling back recent cost-saving reforms in the
Workers’ Compensation system.
In my opinion, such a rollback would have disastrous consequences
for businesses, local governments and for California’s taxpayers.
When legislators came together in 2004 to reform California’s
dysfunctional Workers’ Compensation system, they did more than throw
a lifeline to thousands of businesses struggling with
highest-in-the-nation Workers’ Compensation costs. The reforms also
brought financial relief to counties, cities and other public
agencies throughout California which, like private businesses, were
grappling with skyrocketing cost increases. The extra challenge for
public agencies was reconciling these increased costs with the need
to provide other critical services, such as public safety, health
services and maintenance of roads, buildings and parks.
In less than two years, the reforms contained in Senate Bill 899
(Poochigian) have delivered on their promise to local government.
For example, the County of Los Angeles had previously set aside $414
million to cover our anticipated Workers’ Compensation costs for our
2004-2005 budget. Thanks to the SB 899 reforms, coupled with a new
Consolidated Risk Management Program established by the County in
2001, we have been able to reduce these anticipated costs by 34
percent.
That translates into a savings to taxpayers of $141 million, money
that will be invested back into our community in the form of new or
expanded services, rather than being dedicated to the ballooning
costs of Workers’ Compensation.
The long-term impacts are even more impressive. At the height of the
Workers’
Compensation crisis, we projected that Los Angeles County would be
paying more than $1.1 billion by the year 2010. Today, we are
projecting our costs in 2010 to be $400 million – a $700 million
savings to local taxpayers.
With similar results being replicated by counties, cities, school
districts and other public agencies in the state, lawmakers should
pat themselves on the back for a job well done. It would be a
mistake for legislators to roll back the reforms passed in 2004.
First, besides the fact that the reforms are yielding enormous
benefits for local taxpayers, the system was redesigned so that it
works better for both employers and injured workers. The SB 899
reforms were crafted so that injured workers are, for the first
time, treated according to medical treatment guidelines. These
guidelines are helping to ensure that workers get the most
appropriate medical care, not simply the most expensive care, which
was too common under the old system.
Second, the new system also establishes incentives for getting
injured workers back on the job, which means an improved economic
outlook for workers who were treated under the old system as though
they had no chance of ever being able to return to their job after
sustaining a workplace injury.
Lastly, the system is still in the process of absorbing the
significant changes brought about by SB 899. Although we are
approaching the two-year anniversary of the reform’s passage, the
Workers’ Compensation system hardly turns on a dime. Claims managers
and medical professionals are still on a learning curve. The true
impact of the reforms is just now being reflected in total system
costs and savings.
While California might never have a perfect Workers’ Compensation
system, SB 899 has stopped the skyrocketing costs and put our system
back on the mend. We need continued vigilance to prevent fraud and
abuse and make sure the system is serving both businesses and the
people who need it the most; the injured workers that Workers’
Compensation was designed for. We need ongoing studies to determine
exactly how the system is changing in the post-reform environment.
Now is not the time, however, to go backward. The reforms created
two years ago are far too important for taxpayers, businesses and
injured workers to be abandoned now.
DON KNABE
Supervisor, Fourth District
County of Los Angeles
### |
