Workers Comp Zone


CHSWC (the California Health Safety and Workers’ Compensation commission) held its meeting in Oakland on June 7.

Issues that are discussed at CHSWC typically are key current and emerging issues in the system.

What follows is a brief, selective snapshot paraphrasing some of the key comments I noted at the meeting.

George Parisotto, Administrative Director of the DWC, provided a brief update on the following issues in progress with the DWC:

Med-Legal Fee Schedule revision: there were a great number of commenters participating in the online public comment forum regarding proposed amendments to the Med-Legal Fee Schedule. Parisotto noted the DWC is concerned with rising exam costs and abuses but will go back and take a look at the proposal and likely post changes before formal rule making begins. Commissioner Wei encouraged Parisotto to involve stakeholders in an in-person meeting with a “dynamic discussion”, a suggestion to which Parisotto seemed amenable. She also mused that the DWC needs to be careful about unintended consequences and that perhaps there would be less need for aggregator services if QME compensation is set thoughtfully. In a later public comment period several owners of Medical-Legal groups presented their concerns, and one (Scott Thompson of Arrowhead Evaluation Services) presented a proposal for a revision of the schedule.

Interpreter fee schedule: formal rule making is expected within the next month

Amended UR regs: these will be posted soon

Formulary: members of the therapeutics committee will be announced soon

IMR volume: there appears to have been a recent spike in IMR requests. Parisotto speculated that the cause might be that doctors are still adjusting to 2017 amendments to MTUS. It appears that pharmacy disputes still comprise a big share of IMR requests but it is too soon for the formulary to have had an impact. Several commissioners asked questions about the spike in IMR numbers, such as whether the new guidelines were more strict, etc. Commissioner Wei requested more information about the path forward given that a new administration may come next year.

EAMS: the software is being upgraded

Provider suspensions: 260 have been suspended from the system and around 152 criminally charged have had liens stayed.

Parisotto was followed by Michael Dworsky of RAND, presenting slides on “Wage Loss Monitoring in California’s Workers’ Compensation System” , a study that will be published soon (see pdf of Dworsky’s powerpoint at the bottom of this post).

Dworsky noted that RAND had done prior wage loss monitoring studies for CHSWC and the DWC. The rationale is that earnings loss data is key in evaluating benefit adequacy and return to work interventions. RAND is working with DIR and EDD data in doing its study. A report will be coming soon that looks at wage loss for 2013 injuries, and there will be two other phases, eventually looking at 2014 through 2017 injuries.

Dworsky noted that this RAND study is not intended as a proxy assessment or “report card” for SB 863 since some of the SB 863 reforms were phased in.

He proceeded to give a brief recap of the proposed study methodology. Earnings loss is the difference between what a worker would have earned in absence of injury and what they actually earned. The data tell us actual earnings of workers, but their potential earnings have to be estimated. RAND’s strategy is to compare injured workers to a control group of co-workers who did not file a workers’ comp claim , focusing on earnings after the second year from injury.

Several commissioners raised questions about the study methodology. For example, Ms. Kessler noted that on Slide 8 even the control worker earnings go down over several years, though the injured worker earnings went down even more. Dworsky noted that this is because the RAND methodology assumes that some of the group of control workers will drop out of the labor market, retire, be laid off etc. Kessler noted that this seems to skew the graph and does not give a true picture of the wage loss workers sustain if we dilute the comparison by including those who leave the labor market for various other reasons. Dworsky cheerfully gave a brief defense of the proposed methodology, which he termed the “best benchmark”, but seemed to concede that RAND could run the numbers in another way. Kessler noted that she felt RAND’s proposed method “isn’t reflective of reality”.

What will come of this colloquy is not clear, but it does appear to highlight an aspect of the study which is counterintuitive and likely troubles some observers. It would be a helpful thing for RAND to do a data run the alternative way (comparing injured workers to a set of co-workers who remained on the job) and also to provide more insight into pros and cons of different methodologies. This is not just an arcane point because what the study measures is key to its usefulness as a benchmark in the real world for policy making.

But there were other areas of interest in Dworsky’s presentation. Looking at subgroups, workers from smaller employers had worse wage loss outcomes than employees of large firms. And workers with cumulative injuries were associated with more severe earnings loss, particularly in Southern California.

Dworsky noted that the focus of the RAND study is not looking at the “mechanisms driving poor outcomes” for C/T claims in Southern California. However, Dworsky speculated on some causes, though noting that additional study is needed on these regional differences. Several of the commissioners noted that this is something which needs focus, particularly given several other studies which claim that the LA Basin is seeing different trends than other areas of the state. For example, Commissioner Brady noted that his information is that in Southern California cumulative claims are 22% of the claim load but around 40% of the dollars.

Commissioner Bloch noted that age, gender and ethnicity could be factors and to not look at these might be irresponsible. Dworsky noted that it is possible to look at the age and gender and he seemed amenable to looking at these factors. But data on ethnicity is not available since EDD and DWC do not collect that. Kessler wondered if the data could be broken down and studied by zip code or specific industries. Dworsky noted that they have zip code level data, but would need to choose which zip codes to study.

Here are the slides on the upcoming RAND wage loss monitoring study:


Additional slide presentations at the meeting included a preliminary inquiry on the SJDB voucher program, a report on options for implementing changes to the RTW Supplement Fund, and a report on mental health programs for first responders. Those slides are noted below:

SDJB voucher program slides:


RTW Supplement program slides:


Mental health programs for first responders slides:


Stay tuned.

Julius Young