Calif. Gov., Legislative Leaders Crafting Tentative Agreement on Workers’ Comp Reform

January 18, 2002

California Gov. Gray Davis and legislative leaders are crafting a tentative agreement addressing workers’ compensation reform, with hopes of passing a workers’ compensation benefits bill by Jan. 25.

Davis, who vetoed Senate Bill 71 in October of last year, pledged to reach out to legislators and other interested parties to cohesively put together a reform bill. The bill vetoed by Davis last fall was the third workers’ compensation bill he has turned down in as many years.

“The legislature and the governor’s staff have been meeting for about nine weeks,” Steven Maviglio, press secretary for Davis, commented. “There’s no deal, no breakthrough, there are a lot of points of agreement.”

Maviglio pointed out that some issues are still contentious, but the sides “are getting closer and making progress.”

Sam Sorich, vice president and western regional manager of the National Association of Independent Insurers (NAII), commented that the association is hopeful that the governor and legislative leaders can come to a reasonable agreement to avoid a costly and divisive ballot initiative.

“Meaningful workers’ compensation legislation must adequately balance any increase in benefits with cost-saving reforms,” Sorich commented.

According to the NAII, rising medical expenses, higher loss costs, inappropriate medical treatment and lack of objectivity in the disability evaluation process are causing workers’ compensation costs to increase.

While injured workers need higher benefit levels, workers’ compensation benefit increases must be coupled with substantive reforms that address the major problems that are escalating workers’ compensation costs, Sorich added.

The new benefits package, SB 1156, will be revised next week with cost-saving measures that Davis has proposed, California Assembly Insurance Committee Chairman Tom Calderon said earlier this week.

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