Employer-Backed Workers' Compensation Bill Clears Committee

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

Capitol Update, April 14, 2003 Share this on FacebookTweet thisEmail this to a friend

An unusual array of supporters that included employers, organized labor, insurers, and non-medical providers lined up for SB 228 by Senator Richard Alarcon (D-Sylmar) during the Senate Labor and Industrial Relations Committee hearing on April 9. The bill would revise the development and implementation of fee schedules for outpatient surgery facilities, official medical and pharmaceuticals. The bill passed out of committee on an 8-0 non-partisan vote.

According to the sponsors, the bill could save employers almost $1 billion in medical costs. SB 228 is in response to AB 749 (Calderon), the major workers' compensation benefits increase bill that passed last year and signed by the governor. In addition to the benefits increase, the bill was supposed to provide some savings for employers to help offset some of the costs. However, these savings have not materialized because the provisions were written in such a manner that made it impossible to achieve in the short term.

Under SB 228, the fee schedules will be developed and promulgated by the Administrative Director based primarily upon fee schedules developed for the Medicare and Medi-Cal programs. This will allow the director to develop fee schedules more quickly because the schedules already exist. This is especially important to adopting an outpatient surgery facility fee schedule because current law requires extensive and costly accumulation of data that could take up to five or more years. The bill would also allow the director to create alternate fees where no Medicare or Medi-Cal fees exist and to adjust fee schedules up to 120% of the Medicare fee schedule to more fairly compensate physicians and medical facilities who serve injured workers. In addition, the bill will allow some administrative savings because the Medicare and Medi-Cal schedules are updated annually.

SB 228 would also require that sufficient funding be dedicated to funding fee scheduling, court staffing and a court technology upgrade if and when the Division of Workers' Compensation is altered to require employers to contribute a greater portion than the General Fund.

While CMTA is in strong support of the bill, there are numerous changes needed to clarify some issues. The bill will next be heard in Senate Appropriations Committee.
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