Gino DiCaro

Workers’ comp bill cost analysis challenged

By Gino DiCaro, VP, Communications

Capitol Update, Aug. 26, 2011 Share this on FacebookTweet thisEmail this to a friend

According to the Senate Appropriations Committee, a bill authored by Assembly Insurance Chairman Jose Solorio (D-Santa Ana) could cost employers an additional $200-$210 million annually in workers’ compensation rates. AB 947 would increase temporary workers’ compensation disability benefits injured employees may receive from 104 weeks to 240 weeks in a five year span beginning next year.  An initial fiscal impact assessment, however, conducted by the Commission on Health and Safety and Workers’ Compensation using data from the California Workers’ Compensation Institute and the Workers’ Compensation Insurance Rating Bureau found that employers could actually see costs rise $188-$238 million given certain medical treatment guidelines.

Opponents of the bill, including CMTA, claim the bill will increase payroll costs for employers during hard economic times in addition to longer, more expensive claim costs and increased litigation.  In response to the Committee’s analysis and criticisms, Assemblyman Solorio claimed the cost estimates to be exaggerated and that some injured employees require additional time after the 104 weeks since they are not yet able to return to work but not ready to claim permanent disability.

The bill passed off the Senate Appropriations Committee suspense file and will now go to the Senate Floor for consideration.

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