Garamendi Issues Plan for Workers’ Comp

Hoping to influence how lawmakers reform California’s workers’ compensation system, state Insurance Commissioner John Garamendi released his own plan Tuesday that he said would reduce costly lawsuits and get benefits more quickly to injured employees.

The plan calls for a slew of changes to the state’s current system, which California employers say is too costly and worker advocates contend does not provide adequate benefits.

“What I am proposing is a bridge between the business community and labor interests in California that the Legislature can cross over,” Garamendi said.

Garamendi’s proposal comes as lawmakers in Sacramento debate the merits of a workers’ compensation bill backed by Gov. Arnold Schwarzenegger. The Assembly Insurance Committee was scheduled to review Garamendi’s and the governor’s plans today during the first of six hearings on the issue.

Schwarzenegger and legislative leaders met for about an hour Tuesday in Sacramento to discuss how to reach a compromise on the proposed legislation.

Schwarzenegger and business groups are backing a bill designed to cut employers’ workers’ compensation costs by about $11 billion, but it has run into strong opposition from Democrats, labor and workers’ attorneys, who contend that the bill would hurt injured employees.

Schwarzenegger set a March 1 deadline for legislators to vote on the bill.

He has threatened to put his proposal on the November ballot for voters to consider if lawmakers don’t come through.

Among the key provisions in Garamendi’s plan is making uninsured employers subject to felony charges instead of misdemeanors.

Employers also would be required to pay benefits immediately to workers hurt on the job.

The plan would allow employers to dispute workers’ claims for as long as a year, compared with the 90-day period allowed under current laws.

Garamendi also suggested that an independent medical examiner should look at injured workers and determine the extent of their disabilities and what kind of treatment and compensation they should receive, if any.

Garamendi wants lawmakers to simplify the permanent disability rating system for injured employees.

Disputes over the severity of injuries and how much compensation workers should receive are what drive costly lawsuits, Garamendi said.

He acknowledged, however, that he could not estimate by how much his plan would reduce workers’ compensation costs.