Firm Is Carving Into New Law, Some Claim

Special interests, some contend, already are trying to nibble away at California’s five-day-old workers’ compensation overhaul law.

Two days after Gov. Arnold Schwarzenegger signed the new law, the Assembly Insurance Committee on Wednesday approved on a 10-1 vote a bill that a labor leader and a legislator say is aimed squarely at helping an Irvine medical equipment company, VisionQuest Industries Inc.

It’s “a special-interest bill for one company,” said Assemblyman Paul Koretz (D-West Hollywood), who cast the lone nay vote against the measure. “This is a way to cut themselves a better deal.”

The bill’s sponsor and the company deny that intention, saying the bill would save the state money. The governor, who railed against special interests’ interfering with the workers’ comp overhaul, had no comment.

The emergence of an alleged one-company bill so soon after the overhaul legislation’s signing shows how complex, sometimes vague and hurriedly drafted laws are vulnerable to special interest forays, critics say.

The medical-equipment bill, introduced by Assemblyman Ken Maddox (R-Garden Grove), would order the administrator of the state’s workers’ comp program to develop a fee schedule for specialized medical equipment whose prices are not already specified by the federal Medicare program.

The bill, though it doesn’t set a specific date for implementing the new fees, contains loosely worded criteria that could lead to higher prices, some claim.

“For the Assembly committee responsible for workers’ compensation policy to pass this bill is unconscionable,” Thomas Rankin, president of the California Labor Federation, wrote in a letter Wednesday to lawmakers. “Clearly, in the world of workers’ compensation, money still trumps policy.”

Rankin, in a subsequent interview, predicted that more lobbyists and their clients soon will try to chip away at changes in the new law and two other workers’ comp bills passed last fall.

Others agree. Doctors and suppliers who specialize in occupational medicine “can afford to spend a whole bunch of money to change the system in a way that helps them,” said Frank Neuhauser, a workers’ comp specialist at UC Berkeley’s Survey Research Center.

Maddox and VisionQuest contend that their measure is designed to take the mystery out of pricing some of the company’s products, such as “cold therapy” machines for controlling swelling and “portable infusion devices” that deliver medicine to specific spots on an injured person’s body.

They argue that their bill would save the workers’ comp system money by lessening disagreements between providers and insurers that can develop into costly lawsuits.

“My hope is that this bill will streamline part of [workers’ compensation] and bring down costs so we don’t have disputes,” Maddox said.

VisionQuest lobbyist Carlyle Brakensiek concedes that the bill’s main provision -- creation of a fee schedule for durable medical equipment -- is technically not needed. That’s because such a fee schedule already was required by a workers’ comp bill that went on the books Jan. 1.

Brakensiek said VisionQuest was pursuing the bill to goad state bureaucrats into action. “It may be years” before officials issue the fee schedules for VisionQuest’s products, he said.

Rankin, the AFL-CIO’s top official in California, argues that the bill’s attempt to rush the writing of a price list for specialized equipment could “cost untold amounts of money that does not need to be spent” by “tying the hands” of state officials.

Currently, they first must decide if a particular piece of equipment is medically needed and then extrapolate its price based on comparable products already on the Medicare list, Rankin explained.

For its part, the governor’s office hasn’t yet studied the Maddox bill, a spokesman said.