WCIS eNews No. 86
November 23, 2011


WCIS penalties

Senate Bill 826 (SB 826) which was signed into law on October 7, 2011, amends Sections 138.6 and 138.7 of the California Labor Code by authorizing the Division of Workers’ Compensation (DWC) to assess administrative penalties for the failure by a claims administrator to report accurate claim information to the Workers' Compensation Information System (WCIS). The bill can be viewed at http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0801-0850/sb_826_bill_20111007_chaptered.pdf.

The major amendments in SB 826 are:

  1. Requires DWC to assess administrative penalties for WCIS data reporting violations.
  2. Requires DWC to promulgate a schedule of penalties capped at $5,000 against a claims administrator in any given year. The schedule shall provide for no more than $100 per violation for violations where a report is not submitted or not accepted, and no more than $50 per violation for violations involving errors or late filings.
  3. Requires that the penalty schedule establishes threshold rates of violations that shall be excluded from the calculation of penalty assessments. The threshold rates, to be determined by DWC, cannot be less than 3% of the reports filed by the claims administrator. SB 826 further authorizes DWC to establish higher thresholds for data elements (required claim information) that are not reasonably available.
  4. Requires DWC to publish an annual report on the compliance of claims administrators, and authorizes claims administrators to be named in the report.

The assessment of administrative penalties for non-compliant WCIS reporting constitutes a major shift in the manner by which the WCIS operates. From 2000 to the present, DWC relied solely upon its trading partners to comply with the reporting requirements, as there was no express statutory authority to directly penalize claims administrators for a failure to submit data or a failure to submit accurate data. SB 826 now provides DWC with a valuable enforcement tool to ensure the quality of the WCIS database.

The DWC is currently analyzing both the language of SB 826 and the WCIS reporting system to determine the most efficient and cost-effective method for assessing penalties. We anticipate stakeholder input through the annual WCIS Advisory Committee meeting and scheduled public forums. The hope is that an acceptable penalty structure will be in place by June 2013. Updates will be posted on the WCIS website at http://www.dir.ca.gov/dwc/wcis.htm and announced on the WCIS eNews.

Clarification of eNews 85 regarding WCIS regulations implementation

As mentioned in eNews 85, implementation of the new WCIS regulations that are scheduled to become effective on Nov. 15, 2011 has been rescheduled for June 18, 2012. This postponement also includes the new FTPS (FTP/SSL) transmission requirement in section I of the new guides. The WCIS FTP host is ready for beta testing with all FROI/SROI trading partners and any medical trading partners who are currently sending via plain FTP and PGP. Medical trading partners who are already utilizing FTPS transmission will not need to make any changes. Trading partners are strongly encouraged to switch to the new transmission method before June 18, 2012 to avoid last minute delays. Please contact your WCIS trading partner contact to begin the transition. Trading partners that send data through an EDI vendor should verify that their vendor will be ready to transmit to the WCIS FTP host by June 18.

A copy of the regulations and the guides can be found at: http://www.dir.ca.gov/dwc/DWCPropRegs/WCIS_Regs/WCIS_Regulations.htm. Major changes to the guides are listed in Appendix A.

Data quality reports

Trading partner specific data quality reports have been prepared forFROI (148) and SROI (A49) transactions submitted between 6/1/2010 and 5/31/2011. The reports include a summary of the acknowledgments for this period by error code and data element number. They will be sent by email to the business contact person for each trading partner. Claims administrators that send data through a third party administrator (TPA) should contact the TPA directly for a copy of their data quality report.

Aggregated data quality reports for the system are available on the WCIS website at http://www.dir.ca.gov/dwc/wcis/WCIS_Reports.html.

WCIS trading partner contacts:

Johnny Lee
email: jblee@dir.ca.gov
phone: 510-286-6772
fax: 510-286-6862
Trading partner letters A, I-L, S-V, Z

Elisema Cantu
email: ecantu@dir.ca.gov
phone: 510-286-6763
fax: 510-286-6862
Trading partner letters B, D-F, N, O, W-Y

Kenneth Kong
email: kkong@dir.ca.gov
phone: 510-286-6753
fax: 510-286-6862
Trading partner letters C, G, H, M, P-R

Antoinette Esqueda
email: aesqueda@dir.ca.gov
phone: 510-286-6773
fax: 510-286-6862
Medical reports technical contact


Contents of this bulletin do not change existing regulatory requirements; they provide additional or revised detail about the technical implementation of those requirements. All technical changes will subsequently be reflected in other WCIS documentation. Any bulletin can be forwarded as needed, but should be forwarded in its entirety and without modification. If you have received a forwarded copy of this bulletin and are concerned about its authenticity, you can view this and previous bulletins on our WCIS web site: http://www.dir.ca.gov/dwc/wcis.htm.

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