Workers’ compensation deal faces fierce opposition

SACRAMENTO -- A proposed overhaul of California’s workers’ compensation insurance is running into heavy resistance even before it’s been formally introduced in the waning weeks of the legislative session.

A special hearing of the Senate Labor and Industrial Relations Committee scheduled for Wednesday at the state Capitol was postponed and no new date has been set.

As of Tuesday, the most vocal opposition to the $1-billion-plus deal is coming from lawyers that represent injured workers in California’s specialized workers’ compensation courts.

The lobbying group known as the California Applicants’ Attorneys Assn. has issued an “urgent action alert” to its members, clients and allies “to contact your state senator or Assembly member now!”

The alert charges that the proposal, which has been worked out between labor unions and large employers, including Safeway Inc. and Walt Disney Co., is anti-worker.


“The measure gives insurance companies total control not only of medical care, but of all aspects of an injured workers’ medical-legal case,” the alert states.

A spokesman for Sen. Ted Lieu (D-Torrance) said that his office phone had been ringing continuously with complaining calls. Lieu, the chairman of the Senate committee whose meeting was postponed, is expected to carry the workers’ compensation overhaul in his bill, SB 863.

Proponents of the overhaul counter that they carefully crafted legislation that would increase benefits paid to permanently disabled victims of on-the-job accidents by $720 million. Money for the boost would come from streamlining the system and by eliminating some payments made to doctors, lawyers, claims administrators and other service providers in the $11 billion-a-year workers’ compensation system.

While the lawyers have aggressively attacked the proposed overhaul, other workers’ compensation players are being more cautious about commenting before they’ve digested the 279-page bill.

“A lot of us are looking internally to see what we make of this,” said Mark Webb, a vice president of Pacific Compensation Insurance Co. of Thousand Oaks.

The fierce reaction from the applicants’ attorneys, he said, “has thrown everybody for a loop.”

Nevertheless, Webb stressed that the deal is far from dead, and “proponents continue to meet in the Capitol with members to explain the value of their plan.”

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