Executive Summary and Recommendations
Introduction
The legislative reforms of the 1990’s made significant
modifications and additions to the health, safety and workers’ compensation
systems in California. Since its
inception in 1994, the Commission on Health and Safety and Workers’
Compensation, established by the reforms, has been engaged in ongoing
evaluations of these critical programs.
CHSWC’s
efforts have been immeasurably assisted by its community of employees and employers
and their representatives, labor organizations, injured worker groups,
insurers, attorneys, medical and rehabilitation providers, administrators,
educators, government agencies and members of the public.
Information gathered through CHSWC meetings and projects indicate that the reforms have generally improved the system. Workers’ compensation premiums and the number of claims have decreased; medical-legal costs have fallen sharply; and abusive claims practices have been reduced.
However, serious problems linger. Many stakeholders agree that the system remains excessively complex and delivers modest benefits at high costs. CHSWC and the community recognize that these difficulties adversely affect employers, employees and all parties involved with the system.
With extensive cooperation and participation from throughout the community, CHSWC has conducted or contracted with independent researchers for projects and studies of specific aspects of this wide-ranging system. These projects initially focus on identifying, describing and quantifying specific problems. Project findings are published and made available to the community and to the public.
CHSWC believes that further improvements can and need to be made to achieve optimum system performance to serve all of the employees, employers and taxpayers in California.
The following pages contain the Commission’s recommendations for legislative or administrative changes and/or for further study. In some instances, where recommended changes have widespread support and do not require legislative action, the Commission and the community have continued their work together to develop and implement corrective actions. In addition, some project findings have formed the basis for community members to take action in the legislative arena.
CHSWC looks forward to continuing its work with the community in striving to fulfill these goals.
Recommendations
Consider
Benefit Increases
The Commission wishes to ensure that workers sustaining industrial injuries and illnesses and their dependents, if the injury is fatal, receive adequate workers’ compensation benefits in a timely manner. The Commission recognizes that the levels of workers’ compensation benefits over the years may not have kept pace with the economic consequences incurred by industrially injured workers.
CHSWC recommends that the stakeholders and the workers’
compensation community work together to address this issue.
For further information – Please see discussions and reports
on these CHSWC projects
' Permanent Disability Study
Continue
Review of Benefit Structure
The method
by which California rates and compensates injured workers for permanent
disability has enormous impact on the adequacy of their benefits, their ability
to return to gainful employment, and the prompt delivery of benefits at the
lowest cost to employers.
The
Commission realizes that the rating of permanent disability is one of the most
difficult tasks of the workers’ compensation system. In concert with the community, CHSWC has engaged in several
studies and hosted public forums to discuss and develop strategies to improve
this complex program.
The
Commission contracted with RAND to study the workers’ compensation permanent
disability system in California. The
CHSWC study by RAND found that there was a significant uncompensated wage loss
for permanently disabled workers of insured employers, particularly for workers
with permanent disability ratings of 25% and under.
The CHSWC Permanent Disability Policy Advisory Committee – composed of CHSWC members representing employers and labor and interested members of the workers’ compensation community – was formed to make recommendations on further action and future direction of the Commission’s efforts. The PD Policy Advisory Committee adopted the following goals:
§
Efficiently decrease
uncompensated wage loss for disabled workers in California.
§
Increase the number
of injured workers promptly returning to sustained work.
§
Reduce transaction
and friction costs, including “costs” to injured workers.
The Commission makes the following recommendations in pursuit of those
goals.
Engage in Further Study of Uncompensated Wage Loss
The CHSWC study of Permanent Disability by RAND showed that permanently disabled workers of insured employers sustained significant uncompensated wage loss. These findings were unexpected and have raised concerns throughout the entire community.
The Commission
recommends further study of permanent disability, and has contracted with RAND
for additional analyses to incorporate data on self-insured employers, and to
determine the reasons for uncompensated wage loss sustained by permanently
disabled workers.
For further
information – Please see discussions and reports on these CHSWC projects
' Permanent
Disability Study
Develop Empirically-Based Permanent Disability Rating Tool
The CHSWC PD study by RAND found that the current Permanent Disability Rating Schedule (PDRS) does not render benefits to injured workers commensurate with the level of wage loss sustained as a result of the industrial injury or illness.
The Commission recommends that cooperative work by the community continue to improve the permanent disability system. CHSWC has contracted with RAND to develop an empirically based tool for rating and compensating industrially injured workers who sustain permanent disability.
For further
information – Please see discussions and reports on these CHSWC projects
' Permanent
Disability Study
Enhance Return to Work Efforts
The Industrial Medical Council believes that an injured worker should return to work as soon as it is medically feasible. If the injured worker is unable to immediately engage in his/her usual occupation, the injured worker should be returned to modified or alternative work, provided that such work can be practically accommodated by the employer. The treating or evaluating physician should recommend appropriate and specific work restrictions.
CHSWC
concurs with the IMC’s position and recommends implementation of this concept
at all levels throughout the system.
The Commission recommends and has engaged in further study to measure and assess return to work programs and to determine “best practices”. The Commission further recommends that specific policies and strategies be developed from those findings.
For further
information – Please see discussions and reports on these CHSWC projects
' Literature
Review of the impact of modified work
' Summary of
Methods to Predict/Evaluate Return-to-Work
Reduce System Complexity
Identify and Correct Discrepancies and Inconsistencies
The workers’ compensation system operates pursuant to provisions in the law, regulations, and policies and procedures. This assemblage of various instructions is inconsistent and confusing in various areas.
CHSWC
recommends that a task force be formed to review and correct discrepancies
among the law, regulations, policy and procedures and other instructions. CHSWC urges that unnecessary regulations,
policy and procedures, and instructions be identified and eliminated.
The workers’
compensation community encourages the WCAB to take on a more active role in
judicial oversight -- for example, by means of en banc decisions -- in an effort to achieve uniformity in
the application of the law. CHSWC
concurs and supports this recommendation.
Consider Paying All Benefits at a Single Weekly Rate
The industrially injured worker receives payment at
different weekly rates for the various types of
workers’ compensation benefits: Temporary Disability (TTD), Permanent
Disability (PD), and the Vocational Rehabilitation Maintenance Allowance
(VRMA). Both the TD and the PD weekly
rate can change several times over the life of the claim.
The CHSWC study of the DWC Audit Unit determined that these
different and changing weekly rates are confusing to administrators and workers
and contribute to errors and delays in benefit payments.
The Commission recommends that further study be given to the proposal
that an injured worker receive payment for all types of workers’ compensation
indemnity benefits at a single weekly rate.
Under this proposal all workers’ compensation benefits would be paid at
the TTD rate regardless of the type of benefit. This would not change the total amount of benefits, only the rate
at which they are paid out.
For further
information – Please see discussions and reports on these CHSWC projects
' Study of DWC
Audit Function
Consider Simplifying Permanent Disability Benefit Calculations
The calculation of workers’
compensation Permanent Disability benefits is complex for the claims
administrator and confusing for the injured worker. In part this is because the weekly payment amount factors in a
changing multiplier of weeks of payment as the seriousness of the disability
increases, and a changing maximum rate as the seriousness of the disability
increases.
Consider
simplifying the calculation of the amount of PPD due by eliminating the stepped
maximums in the weekly rate. However,
it is important to note that this may result in substantial changes in the
level of compensation paid by employers or the distribution of compensation among
different groups of workers.
This issue
will continue to be discussed as part of the continuation of the Commission’s
study of permanent disability.
For further
information – Please see discussions and reports on these CHSWC projects
' Permanent Disability
Study
' Study of DWC
Audit Function
Improve Quality of Physician Reports
Many disability evaluators in the Division of Workers’ Compensation indicate that their largest problem is the inadequate information on medical reports from which to derive permanent disability ratings. The Commission is engaged in a study of medical reports produced by physicians – both treating and non-treating. Preliminary findings from that study indicate that legal decisions are being based on reports with inadequate data (those from treating physicians) without any apparent cost savings.
The Commission recommends that the Industrial Medical Council continue its efforts to train treating physicians to produce ratable medical reports. The Commission notes that the IMC has furthered this process by developing medical reporting forms for the final treating physician and QME evaluators, and recommends that the IMC continue to monitor their usage and effectiveness.
The Commission
notes that the DWC has developed a primary-treating physicians’ medical
reporting form to be used to rate permanent disabilities, the “Primary Treating
Physician’s Permanent and Stationary Report” (DWC PR-3). CHSWC recommends that its usage and effectiveness
be monitored.
The Commission recommends that the DWC, the IMC and the
community review the statutory presumption given to the findings of the primary
treating physician; this could involve recommendations to change the special
authority, giving ‘great weight’ to the PTP report, rather than the
presumption.
For further
information – Please see discussions and reports on these CHSWC projects
' Medical/Legal
Study
' Physician
Report Study
Review Official Medical Fee Schedule
The Official Medical Fee Schedule (OMFS) has been the subject of controversy and debate within the community for many years. Members of the community have indicated that the OMFS is cumbersome, overly complex, and difficult to update and administer.
The Commission supports the current efforts to explore alternatives for improving the fee schedule. The Commission notes that the Industrial Medical Council has contracted with the UCLA Center for Health Policy Research for a study of the resource based relative value scales (RBRVS) used by the Federal government and several states and the possible options of adopting an RBRVS-based schedule in California.
When a revised OMFS is adopted, the Commission recommends that DWC, with the assistance of the IMC, continue with its statewide educational training efforts to inform all parties on the appropriate use of the OFMS.
The Commission will follow the IMC studies and the adoption of a revised schedule by the DWC Administrative Director and provide whatever assistance appears warranted from time to time.
Review ‘Baseball’ arbitration
Labor Code §4065 provides
that where either the employer or the employee have obtained evaluations of the
employee's permanent impairment and limitations from a qualified medical
evaluator under Section 4061 and either party contests the comprehensive
medical evaluation of the other party, the workers' compensation judge or the
appeals board shall be limited to choosing between either party's proposed
permanent disability rating. The
employee's permanent disability award shall be adjusted based on the disability
rating selected by the appeals board.
However, with the use of such "baseball arbitration”, the result
is often perceived as unfair.
Experienced triers of fact in the workers' compensation field believe
that more often than not an applicant's true disability lies somewhere between
the description of PD obtained by the applicant and that procured by the
defendant. Under §4065, however, a WCJ
may be ‘forced’ to award too much or too little.
The Commission recommends further study on this issue. At its May 1999 meeting, the Commission voted to incorporate this issue into the ongoing study of permanent disability. The Commission also recommends obtaining statistical data on the usage of baseball arbitration.
Clarify Labor Code Section 5814 – Unreasonable delays
Labor Code Section 5814 provides that "when payment of compensation has been unreasonably delayed or refused, either prior to or subsequent to the issuance of an award, the full amount of the order, decision or award shall be increased by 10 percent." Section 5814 has been the subject of considerable litigation since its enactment in 1945, and its interpretation continues to be problematic.
With a ‘call for information’, the Commission requested
input from the workers’ compensation community and the public on the Labor Code
Section 5814 penalty provisions. The
community responded with great interest.
In light of
the Supreme Court decision in Stuart and stakeholders’ concerns, CHSWC
recommends that Labor Code Section 5814 be reviewed to provide a more fitting
penalty assessment, which is appropriate to the length and type of delay. The Commission has offered to serve as a
clearinghouse for recommendations regarding Labor Code Section 5814. At its May 1999 meeting, the Commission
decided to collect WCAB statistical data for further analysis of this issue.
For further information
– Please see discussions and reports on these CHSWC projects
' Section 5814
Issue Paper
Review Vocational Rehabilitation
The 1993 workers’ compensation reform legislation made major
changes affecting the level and delivery of the vocational rehabilitation
benefit. The Commission contracted for
a study to help evaluate the impact of the workers’ compensation reform
legislation on the vocational rehabilitation system. The study is assessing whether the reforms reduced the cost of
the rehabilitation benefit for employers and determining how those changes have
affected outcomes for injured workers.
Preliminary findings indicate that VR may not now be considered to be a
completely successful program.
The Commission recommends that a Vocational Rehabilitation Roundtable, composed of interested members of the workers’ compensation community and the public, be established to review the Vocational Rehabilitation benefit.
For further
information – Please see discussions and reports on these CHSWC projects
' Vocational
Rehabilitation Study
Consider Carve Outs Carefully
A provision of the workers’
compensation reform legislation allows construction contractors and unions to
collectively bargain over alternative workers’ compensation programs, also
known as Carve Outs. CHSWC engaged in a
study that is identifying the various methods of alternative dispute resolution
that are being employed in California carve-outs, and beginning the process of
assessing their efficiency, effectiveness and compliance with legal
requirements.
The Commission
recommends that caution be exercised when considering the expansion of
carve-out programs to other industries.
Carve-out programs potentially offer labor and management opportunities
to negotiate better arrangements for both.
However, implementation of structures that take advantage of the
opportunities offered by carve-outs have proved to be initially difficult and
inconsistent in the construction industry.
In addition, large cost savings have failed to materialize thus
far.
The carve-out
program should not be viewed as a panacea, but as an opportunity to attempt
innovations that could lead to improvements in the statutory system.
For further information – Please see discussions and reports
on these CHSWC projects
' Carve-Out
Study
Change Mechanism for Commission Funding
In order to avoid the
appearance of a conflict of interest, funding for CHSWC should not be totally
dependent on the amount of the audit penalties collected by the DWC Audit
Unit. Currently, audit collections are
deposited into the Workplace Health and Safety Revolving Fund and the
Commission’s budget is appropriated out of that fund. If audit collections are not sufficient to meet the needs of the
Commission, there is currently no recourse.
The Commission proposes that audit collections be deposited
into the state’s Workers' Compensation Administration Revolving Fund (see Labor
Code Section 62.5) or into the State General Fund. An adequate amount for the Commission’s budget could then be
appropriated from the state’s Workers' Compensation Administration Revolving
Fund or from the State General Fund. If
allocated from the state’s Workers' Compensation Administration Revolving Fund,
the Commission’s budget would be included in the 80/20 funding ratio for
workers’ compensation programs.
For further
information – Please see discussions and reports on these CHSWC projects
' Study of DWC
Audit Function
Streamline
Operations
Several studies, including KPMG, RAND, WCRI, and the CHSWC DWC Profile, have determined a need for improving the operations of the DWC district offices throughout the state. Inconsistency and lack of uniform procedures are often cited. RAND suggests that the system is poorly utilized and burdened by unnecessary paperwork and litigation issues.
The Commission
recommends that DWC continue and enhance its efforts to streamline processes,
establish and maintain uniform procedures, and review and evaluate its current
organizational structure. CHSWC also
recommends that DWC continue to invest in infrastructure, training and
technology improvements.
Review the DWC Organizational Restructure
The Division of Workers’ Compensation is in the process of implementing a revised organizational structure employing three regional centers with regional managers to provide information and assistance, designating that all district office staff report to the presiding judge, and establishing a Policy, Program Evaluation and Training Unit.
The Commission
recommends that the implementation and operation of the new DWC organizational
structure be followed and evaluated.
Implement Electronic Filing of Documents
The state’s health, safety and workers’ compensation systems in California necessarily require the transmission of a lot of information among various entities in the public and private sectors. The evolution of technology now enables the electronic transmission of such data, with savings in time and resources and with increased speed and accuracy.
CHSWC supports
efforts by the DWC and the WCAB to implement procedures and methods for the
electronic filing of documents among all parties. The capability for electronic filing would assist in the prompt
delivery of proper benefits in a cost-beneficial manner.
Consider Concept of the “Paperless Office”
In December 1998, the State
Compensation Insurance Fund conducted a walk-through of the operations of their
Sacramento office for CHSWC members and staff, who were very impressed with
SCIF’s ‘state of the art paperless claim file system’.
The Commission believes that this approach may be helpful to the Division
of Workers’ Compensation in the management of their many case files and
recommends that the Division of Workers’ Compensation evaluate utilizing the
concept of the ‘paperless’ office for its district office operations.
CHSWC recommends that the DWC continue its efforts to develop and
implement the electronic storage of paper files. This could result in significant savings in State Records Center
charges and DWC storage space.
The Commission recommends that the Workers’ Compensation Appeals Board
review the applicable statutes and regulations and recommend changes to
eliminate unnecessary retention of paper documents while retaining full legal
protections for all case parties.
Manage DWC Lien Workload
One of the
most persistent administrative problems facing the DWC in recent years has been
the development of a continuous backlog of lien claims at some DWC district
offices.
CHSWC acknowledges the past efforts and accomplishments of
the DWC in directing resources to and reducing the backlogs of lien
claims. CHSWC recommends that DWC
continue monitoring and addressing this problem.
CHSWC recommends the continuation of its “Lien Resolution
Roundtable”, comprised of interested members from the workers’ compensation
community. The Roundtable is discussing
a proposal developed by CHSWC staff with legislative and administrative
recommendations to address lien issues.
CHSWC recommends continuing evaluation of this ongoing problem. The Commission and DWC will begin statistical
analysis of liens.
Reconsider
Delegation of Hearing Notice Issuance
It has been
reported that in newer WCAB cases, many of the lien claimants are not receiving
proper notice of upcoming hearings, primarily due to the delegation by DWC of
the responsibility for issuing the hearing notice to the parties. This has resulted in costly rescheduling,
unused court time, churning of cases and delays in resolution.
The Commission recommends that the Division of Workers’ Compensation
review the cost-benefit and the impact on the timeliness of case resolution by
the delegation of hearing notice issuance to the requesting party.
CHSWC recommends that DWC continue its efforts to identify reasons for
improper notice and to train the DWC staff to update the address records as
needed.
The Commission also recommends that the DWC pay particular attention to
updating its online system database of addresses of the various parties. Some lien claimants, such as small medical
groups in the Los Angeles basin area, change addresses frequently.
Eliminate ‘Local’ Forms and Procedures
CHSWC has received allegations that some WCAB district offices and workers' compensation administrative law judges are using forms and procedures that have not been established by the Appeals Board. Such actions would be in violation of Labor Code Section 5500.3, which provides that the Appeals Board establish uniform court procedures and forms and prohibits local offices and workers’ compensation judges from requiring other forms or procedures.
CHSWC recommends that efforts be made to identify and
eliminate the use of unauthorized forms and procedures. At the May 1999 meeting, CHSWC voted to
initiate a ‘call for information’ to the community regarding local forms and
procedures.
The Commission recommends that a task force be established to review the
‘call for information’ findings and each office’s individual procedures. The purpose would be to develop proposed
revisions to existing forms and procedures for use statewide.
The Commission recommends that the Workers’ Compensation Appeals Board
update and adopt standardized forms and establish appropriate procedures in
regulation, pursuant to the task force recommendations.
Enhance Information/Feedback Systems
The Commission and the community recognize that
timely and reliable information at all stages is vital to the optimum
functioning of the workers’ compensation system. Employers and employees need information before a work injury occurs,
when an injury occurs, during the course of the claims process and, if
applicable, the claims adjudication process.
Timely and accurate feedback on how the system is working is needed by
administrators.
Workers’ Compensation Information
CHSWC realizes that, if the injured worker is to be served by the system, he or she must be aware of his or her rights and obligations under the workers’ compensation program. CHSWC studies have indicated that some injured workers receive inconsistent and inaccurate information.
To address
this need, the Commission engaged in a project that developed prototype
informational materials – fact sheets and a video - for use by the community
and available to the public at no charge.
At the urging of the community, the project was augmented to produce
further fact sheets.
CHSWC
recommends that the Division of Workers’ Compensation and other community
members use, promote and facilitate the distribution of the prototype workers’
compensation informational materials.
CHSWC also
recommends that members of the community continue to work together to develop,
update, and distribute useful information for workers about the California
workers’ compensation system.
For further
information – Please see discussions and reports on these CHSWC projects
' Injured Worker
Experience Study
' Prototype
Informational Material Project and Augmentation
Improve Benefit Notice Program
When an employee files a
claim for worker’s compensation, the employer or insurer is responsible for communicating
the status of the claim to the employee by means of a series of benefit
notices. The benefit notice program is intended to be a key communication tool
between the claims administrator and the injured worker, keeping the worker
informed about important changes in the status of his or her workers’
compensation claim.
The workers’ compensation
community has long criticized the benefit notice system as confusing and
ineffective. Through its various
studies and analyses, the Commission has confirmed that:
·
The Benefit Notice system is
complex, cumbersome, and not currently designed to provide meaningful
information to injured workers regarding benefit levels or to collect
appropriate data to monitor prompt delivery of proper benefits.
·
Current benefit notices are
not readily comprehensible and result in confusion to injured workers and all
parties.
CHSWC
recommends that cooperative community efforts be undertaken to identify benefit
notice problems that contribute to problems with claims and make needed
improvements to the benefit notice system.
Benefit notices should transmit clear and concise information to injured
workers.
Consideration should be given to an automated, simplified benefit
notice system with initial key indicators to be submitted electronically to the
State of California.
The Commission has contracted with the Labor Occupational Health
Program to assess the needs and explore methods for improving benefit notices
to injured workers. The project team
will review and make recommendations on streamlining the Benefit Notice
process, clarifying requirements, and ensuring that notices accurately and
effectively communicate with injured workers in a format and language that is
comprehendible.
For further
information – Please see discussions and reports on these CHSWC projects
' Benefit
Notice Study
Revise DWC Audit Program
The audit function of the Division of Workers’
Compensation (DWC) was established by the 1989 Workers’ Compensation reform legislation
to monitor the performance of insurers and administrators to ensure that
industrially injured workers receive proper benefits in a timely manner. At the joint request of the Senate
Industrial Relations Committee and the Assembly Insurance Committee, the
Commission undertook an evaluation of the DWC Audit Unit with respect to
its effectiveness, its staffing level and whether or not audit penalties are
adequate or appropriate.
The study determined that although much time and effort was being expended
by the DWC Audit Unit in performing audits of workers’ compensation insurers, a
redirection of these activities would produce more effective outcomes. The research team found that the current
audit procedure, as established by statute, did not include all insurers within
a reasonable period of time, did not focus on the worst performers, and
concentrated penalties on relatively inconsequential violations.
The Commission recommends revisions to the
workers’ compensation audit function to:
·
Reward
good performers by eliminating administrative penalties and resource
requirements,
·
Increase
incentives to improve benefit delivery by raising administrative penalties
substantially on poor performers,
·
Focus
administrative penalties on important violations,
·
Provide
balance to the audit process:
·
Bad
business practices by claims administrators mean that injured workers are not
receiving proper indemnity payments and appropriate medical services in a
timely manner.
·
Excessive
audit penalties and regulation mean employers are paying higher costs to
deliver the same benefits.
For further
information – Please see discussions and reports on these CHSWC projects
' Study of the
DWC Audit Function
DWC Information Systems
Labor Code Section 138.6 directs the Division of Workers' Compensation to develop a cost-effective workers' compensation information system (WCIS) compatible with the IAIABC’s Electronic Data Interchange (EDI) system:
§ to help the Department of Industrial Relations manage the workers' compensation system more effectively,
§ to help evaluate the efficiency and effectiveness of the benefit delivery system,
§ to help measure how adequately injured workers are indemnified, and
§ to provide statistical data for research.
CHSWC recommends that DWC continue its efforts to develop this information system, contingent upon appropriate and effective security and confidentiality measures.
CHSWC notes that the language of Labor Code Section 138.6 may be inadvertently restrictive in that the WCIS system must be ‘compatible’ with the IAIABC’s system. Since the IAIABC’s system design is not yet finalized, CHSWC recommends that some flexibility be allowed in the language of Labor Code Section 138.6.
CHSWC encourages the Division of Labor Statistics and Research to revise its regulations to enable data from Form 5020 (Employer’s Report of Injury) and Form 5021 (Doctor’s Report of Injury) to become part of the DWC Information System. This would eliminate duplicate filings with the State of California and eliminate duplicate data entry.
CHSWC also urges DWC to improve its current computer systems
to provide basic data needed for ongoing program administration.
Ensure
Effective Health and Safety Programs
Review California Loss Control Program
The Loss Control Certification Unit (LCCU) was established
by the 1993 workers’ compensation reform legislation to ensure that the
insurance industry was appropriately engaged in assisting employers to protect
workers’ safety and health and to enable businesses to benefit from cost
savings and productivity gains resulting from improved workplace safety.
Insurers report that they have had to divert a reported 50%
of their loss control resources to address expensive administrative
requirements – including targeting employers -- rather than address substantive
loss control challenges. Additionally,
the regulations have imposed a structure that discourages the flexibility
required to help employers who actually want assistance.
Commission
recommends that the California loss control program be reviewed with respect to
its efficiency and effectiveness.
Review Targeted Inspection Programs
The reform legislation directed the Division of Occupational
Safety and Health to begin a program targeting especially hazardous employers for
consultations and inspections, to be funded by assessments upon employers with
higher than average workers’ compensation costs.
CHSWC has begun a study on statutorily required safety
efforts, including the federal OSHA mandate for implementation of targeting and
intervention directed at the most hazardous employers.
Promote Health and Safety of Young Workers
The Commission has engaged in several projects
designed to assist in the health and safety of young workers. It is funding a statewide task force --
known as the California Study Group on Young Worker Health and Safety --
charged with coordinating strategies to protect young people from work related
illness and injury. The study group is
composed of groups and individuals dealing with California youth employment and
education issues, as well as others who can play a role in educating and
protecting young workers. The
Commission also funded the development of a video to be used in the schools to
educate young workers on workplace health and safety and their rights and
responsibilities under the workers’ compensation system.
The Commission
recommends that ongoing efforts and focus need to continue in the area of young
worker health and safety.
For further information
– Please see discussions and reports on these CHSWC projects
' California
Study Group on Young Worker Health and Safety
Ensure
Compliance with Requirements
Illegally Uninsured Employers
CHSWC has become aware that some California employers -- particularly in certain industries such as construction, restaurants, and trucking -- fail to secure required workers’ compensation coverage. Employers that are not covered for workers’ compensation impose a burden on injured workers, on employers that comply with the workers’ compensation insurance requirements, and on the state’s taxpayers.
The Commission engaged in pilot projects designed to test matching-records and notification methods to identify illegally uninsured employers and bring them into compliance. The purpose is save monies from the state’s Uninsured Employers Fund and General Fund, assist injured workers, and reduce the current competitive disadvantage and the tax burden on responsible employers.
The
Commission’s pilot project methodologies proved to be efficient and effective
in identifying illegally uninsured employers and bringing them into
compliance. The Commission recommends that these and other efforts to secure workers’
compensation coverage for all workers continue.
The Commission
further recommends that coordinated multijurisidictional efforts be continued
to identify and bring into compliance those employers who are in the
“underground” economy – employers that are unknown in the system, do not have
the required business licenses or permits and do not pay the proper taxes.
For further
information – Please see discussions and reports on these CHSWC projects
' Illegally
Uninsured Employers Study
Illegally Uninsured/Underinsured Employers in the Trucking Industry
Section 34633 of the California Vehicle Code (CVC) requires that certain
commercial motor carriers report annually to the Department of Motor Vehicles
(DMV) with information on their employees and owner-operator drivers including
arrangements for workers’ compensation.
The DMV is required to submit the reported information to the identified
workers’ compensation insurer or to DIR’s Self-Insurance Plans (SIP). However, DMV had not been contacting SIP for
verification of self-insurance status.
Representatives from the Commission
and the Illegally Uninsured Employer Project Advisory Committee met with DMV
staff in June 1999 to examine the current procedures to fulfill the provisions
of CVC Section 34633. The participants
agreed that CVC Section 34633 and PUC Sections 1043, 5230, and 5374.6 are not
currently serving any useful purpose.
The Commission recommends that DIR,
DLSE, CHP and DMV continue efforts to identify illegally uninsured or
underinsured employers in the trucking industry and bring them into compliance.
Continue Anti-Fraud Efforts
The Commission believes that fraud in the California workers’ compensation system has decreased since the implementation of the reform legislation. Traditional fraud claims are down and some blatant medical mills have been put out of business. However, CHSWC and the workers’ compensation community recognize that fraudulent activities continue.
CHSWC recommends that anti-fraud
efforts be directed at all types of fraud, including employers who willfully
fail to secure workers’ compensation coverage, large medical-mill cases and
small injured worker cases.
The Commission recommends that the
community continue to identify and reduce fraudulent activities perpetrated by
anyone and everyone in the system, including but not limited to employers,
employees, insurers, and providers.
The Commission also recommends an
ongoing, independent evaluation of the effectiveness and cost-benefit of these
anti-fraud programs.
For further
information – Please see discussions and reports on these CHSWC projects
' Fact-Finding
Hearing on Anti-Fraud Activities