Race to Develop Workers’ Comp Regulations

By Loretta Macktal, Executive Assistant to the Vice President, Government Relations

Capitol Update, May 7, 2004 Share this on FacebookTweet thisEmail this to a friend

There was reluctance at last week's Pure Premium Rate Hearing held by Insurance Commissioner John Garamendi to estimate the savings from SB 899 (Chuck Poochigian, R-Fresno) until the bill is fully implemented. Those who represent employers are also reluctant. Therein lies the challenge.

Full implementation of the bill means developing and getting numerous regulations approved. Under the direction of the Department of Industrial Relations (DIR), the Administrative Director (AD) of the Division of Workers’ Compensation (DWC) is responsible for developing regulations to implement SB 899. This daunting task is even more challenging because SB 899 was an urgency bill that became effective on April 19, 2004. Ordinarily, bills become effective on January 1st of the next year, giving the AD some lead time to begin working on the regulations.

Not so for Andrea Hoch, Governor Schwarzenegger's newly appointed AD of the DWC. "Now that I have signed workers' compensation reform into law, the responsibilities of the DWC are more important than ever," said the Governor. "I have every confidence that Andrea will ensure the reforms we passed with bipartisan support will be implemented swiftly and properly so that employers can see reduced costs and injured workers can benefit from appropriate care and better benefits in a timely manner." For employers, the Governor's key words are "swiftly and properly."

In accepting the appointment Ms. Hoch said "I am excited that Governor Schwarzenegger has given me the opportunity to oversee California's transition to a greatly improved system of workers' compensation. I will strive to ensure that workers and employers alike realize the full benefits of this important new law."

The mission of the DWC is to minimize the adverse impact of work-related injuries on California employees and employers. DWC monitors the administration of workers' compensation claims and provides administrative and judicial services to assist in resolving disputes that arise in connection with claims for workers' compensation benefits.

Some of the key requirements to be developed by the DWC are:

• a new permanent disability rating schedule;
• rules on apportionment to work-related injuries and impairment;
• regulations for implementation of the medical network plan;
• rules for contracting for Independent Medical Review services;
• a Return-to-Work Program and an employer incentive program;
• regulations for implementing the new QME panel selection;
• regulations and forms for employer offers of regular, modified or alternative work;
• regulations on LC 5814 penalties for unreasonable delayed or denied benefits; and
• regulations on immediate payment of medical benefits for injured workers.

Director Hoch has a formidable task ahead. CMTA wishes her success and will assist wherever possible. CMTA and employers understand the importance of timely and effective regulations to obtain savings from SB 899. These regulations are crucial to providing guidance and direction to stakeholders, providers and the Workers’ Compensation Appeals Board to reduce California's outrageous workers’ compensation costs.
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