Please see report below by our Government Relations person, Lori Kammerer on workers compensation bills signed and vetoed by the Governor.There has been a lot of media attention to the article in the LA Times about Bank of America terminating lines of credit. Some of you indicated you had this happen to you. We worked closely with the reporter. Yesterday, I was interviewed by CBS radio in LA and NPR and I will do a FOX interview today.
Small Business California
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Legislative ActivityThere is much excitement among the employer and provider stakeholders in the workers’ compensation community as Governor Brown vetoed several onerous bills that would have increased employers’ costs, while signing legislation that will provide technical improvements to the system.
As reported back in January of this year, Kammerer & Company forecasted that this would not be a major reform year. We also took a politically educated guess to note publically that the new administration would not increase taxes or impose additional regulations on employers this year. This was obvious as the Governor’s campaign platform clearly outlined his priorities for his first year in office – to balance the state’s $46 billion dollar revenue shortfall. Furthermore, through our discussions with the Governor’s transition team (now members of his Cabinet), this Governor would not be interested in among other things, offering up benefit increases, changing discrimination laws related to apportionment, or extending the 2-year cap on temporary disability.
Instead, this Governor stuck to his plan and focused almost entirely on resolving, at least for the most part, the state’s over-spend and under-reserve mode that has plagued California over the course of the past decade.
The following are key bills signed and vetoed by the Governor, along with the Legislative Tracking Report attached to this update.
• AB 335 by Assemblymember Jose Solorio (D-Santa Ana) – Workers' compensation: notices.
· Requires AD with CHSWC to revise some DWC forms. Removes reference to Vocational Rehabilitation & substitutes Supplemental Job Displacement Voucher references. Eliminates need to send Supplemental Job Displacement Voucher NOPE by certified mail at end of TD.
• AB 378 by Assemblymember Jose Solorio (D-Santa Ana) – Workers' compensation: pharmacy products.
· Provides imposition caps on Compound drugs @83% of generic for lowest price generic equivalent until AD adopts fee schedule.
• AB 397 by Assemblymember William W. Monning (D-Santa Cruz) – Workers' compensation insurance: contractors.
· Requires contractors to prove they are either exempt from coverage or have workers’ compensation coverage when renewing contractors’ licenses.
• AB 585 by Assemblymember Paul Fong (D-Mountain View) – Workers' compensation: cancer presumption.
· Extends existing cancer presumption in Labor Code § 3212.1 to Firefighters working at government installation.
• AB 1168 by Assemblymember Richard Pan (D-Sacramento) – Workers' compensation: vocational expert fee schedule.
· Requires the AD to adopt a fee schedule for Vocational Rehabilitation expert testimony by January 1, 2013
• AB 1426 by Assemblymember Jose Solorio (D-Santa Ana) – Workers' compensation: court administrator.
· Eliminates position of Court Administrator. This position is currently empty and the statutory provisions conflicted with the authority of the Administrative Director. The functions of the Court Administrator will be handled primarily through the AD’s office.
• SB 457 by Senator Ronald Calderon (D-Montebello) –Workers' compensation: liens.
· Provides where an employee obtains medical treatment pursuant a medical plan provided by a self-insured employee welfare benefit plan reimbursement shall be determined notwithstanding the official medical fee schedule adopted pursuant to Section 5307.1. Such liens shall be paid pursuant to the terms of the self-insured benefit plan not according to fee schedule.
• SB 684 by Senator Ellen Corbett (D-San Leandro) – Workers' compensation insurance: dispute resolution: arbitration clauses.
· Would allow California employers to arbitrate disputes under insurance policies that arise in California using California law even where the policy may have been written in a different state and provides for arbitration of disputes using another states law.
• SB 826 by Senator Mark Leno (D-San Francisco) –Workers' compensation: data reporting requirement: administrative penalties.
· Provides for imposition of administrative penalties where a claims administrator violates reporting requirements regulations.
Bills vetoed by Governor Brown:
• AB 211 by Assemblymember Gil Cedillo (D-Los Angeles) – Workers' compensation: permanent disability benefits. A veto message can be found here.
· This bill would have modified the provisions for providing the Supplemental Job Displacement Voucher from after the PD award till the end of TD. It would also have change the voucher amount to a flat $6000 rather than a structured amount based on the level of PD
• AB 584 by Assemblymember Paul Fong (D-Mountain View) – Workers' compensation: utilization review. A veto message can be found here.
· This bill would have required physicians performing UR services be licensed to practice medicine in CA. The bill would have created different standards for WC UR than the same services in Group health. The Governor was aware of the effort to impose this unique requirement in WC and did not consider a need to have different approaches in WC than from the rest of the health care industry.
• AB 947 by Assemblymember Jose Solorio (D-Santa Ana) – Workers' compensation: temporary disability payments. A veto message can be found here.
· This bill would have extended the time for payment of TTD beyond the 104 limit in Labor Code § 4656 where the employee underwent surgery and the period of TD extended beyond the 104 weeks. This bill was amended near the end of the session to limit it to post-surgical cases in an effort to limit the potential expense attached to the changes to Labor Code § 4656. As originally drafted it would have effectively eliminated the 104 limitation on TTD. The recent amendments provided significant limitation on the extension of TTD but the Governor appeared concerned the amendments such as this should be part of an overall effort to modify the system and rather than piecemeal changes.
• AB 1155 by Assemblymember Luis Alejo (D-Salinas) – Workers' compensation. A veto message can be found here.
· This bill would have interposed additional language in Labor Code § 4663 ostensibly to prevent discrimination on the basis of “immutable characteristics” such as race, gender, sexual orientation etc. The Governor’s message indicated the law already recognized similar protections and this provision would have potentially generated additional unnecessary litigation increasing employer costs with little corresponding additional protection to employees.
Lori C. Kammerer
Kammerer & Company
1215 K Street, 17th Floor
Sacramento, CA 95814
Office: (916) 441-5674
Cell: (916) 716-5674