Workers Comp Zone


The continuing narrative of the GOP both nationally and at the state level
will be jobs, jobs, jobs.

Whether President Obama can rise to the occasion with his soon to be announced jobs initiative remains to be seen. Jerry Brown unveiled a proposal this week, but that plan already appears mired in controversy: … -plan.html

California’s Republican Party is fractured and weak. But its narrative is consistent, and it stresses a connection between job creation/job retention and workers’ comp.

Take for instance the piece by Assembly Republican leader Connie Conway of Visalia that’s featured in Jon Fleischman’s Flash Report website which mentions three pending workers comp bills, AB 375, AB 1175, and SB 432: … 2609043848

One can’t help but notice Conway’s reference to Texas Governor (and Presidential candidate) Rick Perry. Perry is already picking up some notable support in the comp community. CHSWC commission member Sean McNally
was listed as an event sponsor in a fundraising invitation for Perry that was widely circulated this week.

But let’s dig a bit deeper than Conway’s soundbites:

For those who haven’t been following this year’s California legislative process, AB 375 (Skinner) would create the first presumption for private employees. Here (at some length) is the Senate Appropriations Committee analysis of AB 375:
“AB 375 would provide, with respect to hospital
employees, who provide direct patient care in an acute care
hospital, that the term “injury” include a blood borne
infectious disease or methicillin-resistant Staphylococcus
aureus (MRSA) that develops or manifests itself during the
period of the person’s employment with the hospital. This bill
would further create a disputable presumption that the above
injury arises out of and in the course of the person’s
employment if it develops or manifests, as specified.”

According to the Committee Analysis:
“MRSA is a bacterium responsible for difficult-to-treat
infections. MRSA are by definition strains of Staphylococcus
aureus that are resistant to a large group of antibiotics
including penicillins and cephalosporins. Under this bill, if a
hospital employee who provides direct patient care in an acute
care hospital develops a blood borne infection or MRSA skin
infection, it is presumed the injury arose out of and in the
course of employment and is therefore, compensable.”

The analysis notes some of the issues surrounding this bill:
“This bill specifies that the bloodborne infectious disease
presumption shall be extended to a hospital employee following
termination of service for a period of 180 days, commencing with
the last date actually worked. The MRSA presumption shall be
extended to a hospital employee following termination of service
for a period of 90 days commencing with the last day worked.”

“The state has seven general acute care hospitals operated by the
California Department of Corrections and Rehabilitation (3) and
the Department of Development Services (4).”

“Most state employees receive industrial disability leave, which
is full gross pay less the amount deducted for taxes for the
first month and two-thirds of full gross pay thereafter. There
is no maximum on industrial disability leave and can be received
for up to one year. State hospital employees are eligible to
supplement their industrial disability leave benefits with any
paid leave credits they have to bring the amount up to their
regular earnings amount. After one year, the state employee is
eligible for up to one year of temporary disability benefits.
Non state hospital employees may receive temporary disability
benefits for up to 104 weeks. In 2011, a year of workers’
compensation temporary disability benefits for an employee may
be up to $51,307.88, increasing to $52,546.00 ($1,010.55 x 52
weeks) in 2012. “

“If a licensed vocational nurse or registered nurse (several job
classifications are involved in providing direct patient care)
working in a state acute care hospital contracts a bloodborne
infectious disease or MRSA, the cost could range from
approximately $33,000 to $65,000 for one year of industrial
disability leave benefits. The employee would be eligible for
up to 52 weeks of temporary disability benefits after exhausting
the industrial leave benefits or $52,546.00 (in 2012). “

“Staff notes AB 947 (Solorio), also on the committee’s file,
would allow the extension of temporary disability benefits under
specified conditions for up to 240 weeks. Also, there are
potentially thousands of state employees who provide direct
patient care in settings other than acute care hospitals. For
example, in 2009, of the 3,891 registered nurses in Bargaining
Unit 17, roughly two-thirds are “level of care” nurses providing
or supervising direct patient care in mental health hospitals,
youth and adult correctional institutions, developmental
centers, and the state’s veterans’ homes.”

“Most persons recover from job injuries but some continue to have
medical problems. Permanent disability is any lasting disability
that results in a reduced earning capacity after maximum medical
improvement is reached. If a person’s injury or illness results
in permanent disability the person is entitled to permanent
disability benefits, even if he or she is able to return to
work. Permanent disability benefits are limited. If a person
loses income, permanent disability benefits may not cover all
the income lost and if the person experiences losses unrelated
to ability to work, permanent disability benefits will not cover
those losses.”

“A doctor makes the determination if an injury or illness caused
permanent disability. The doctor also determines if any of the
disability was caused by something other than the work injury
(for example, a previous injury or other condition) in a process
known as apportionment. The disability is stated as a
percentage which equals a specific dollar amount, depending on
the date of the injury and the person’s average weekly wages at
the time of injury. If the person was injured on or after Jan.
1, 2005, the permanent disability award may be increased or
decreased by 15 percent, depending on whether the person worked
for an employer with 50 or more employees and the employer
offers a salary continuation program and the person accepts or
declines regular, alternative or modified work. Permanent
disability benefits are normally paid when temporary disability
benefits end and a doctor has indicated the person has some
permanent effects from a workplace injury. A person with a
disability rating of less than 70 percent would receive $230
weekly. A person with a disability rating of more than 70
percent would receive $270 weekly. These amounts have not
changed since 2006.”

“In addition to temporary and permanent disability benefits, a
person could incur substantial medical costs. For example,
lifetime health care costs for a person with hepatitis B have
been estimated at $65,000 in the absence of liver
transplantation ($100,000 for hepatitis C). Hepatitis C infects
about three and a half more times as many people in the United
States than does hepatitis B and more than 80 percent of
hepatitis C patients will develop chronic liver disease, as
compared to only 20 percent of hepatitis B patients. The cost
per liver transplantation is in the range of $280,000 for one
year. Continuing medical care can run in the hundreds of
thousands of dollars over a person’s lifetime. According to one
estimate, the lifetime cost of medical care for an HIV patient
was $618,900 which also noted that total treatment costs are
increasing. Ironically, this may be because better treatment
options are increasing total costs by prolonging life.
According to one estimate, the cost to treat a MRSA infection
can range from $1,000 to $7,500 or more if extensive
hospitalization is required.”

“This bill may result in increased Medi-Cal costs in non-contract
hospitals, because the allowable costs of hospital cost reports
include workers’ compensation expenditures. Any increase may be
minor as the state is moving toward a diagnosis-related system
for reimbursing hospitals and is not negotiating any new
contracts and costs would be spread across all payors. This bill
could increase costs to the University of California (UC) which
operates five hospitals. There are an estimated 385 non-state
acute care hospitals and 140,000 full time employees subject to
the bill. In general, the cost for a state hospital employee
and a non state hospital employee with a bloodborne infectious
disease presumption or a MRSA presumption would be in the first
year cost difference between industrial disability leave
benefits and temporary disability benefits. The state (and UC)
would likely appropriate additional funding for increased
workers’ compensation costs and private employers would likely
experience higher workers’ compensation premiums.”

“Existing presumptions (see Labor Code Sections 3212 to 3213.2)
are extended to a member following termination of service for a
period of three calendar months for each full year of the
requisite service, but not to exceed 60 months (120 months for a
cancer presumption for police and firefighters) in any
circumstance, commencing with the last date actually worked in
the specific capacity. AB 2754 (Bass) Chapter 684/2008 added
Labor Code 3212.8 to provide this presumption for members of a
sheriff’s office, or police or fire departments of cities,
counties, districts, or other public or municipal corporations
or political subdivisions and active firefighting members of the
Department of Forestry and Fire Protection or any other county
forestry or firefighting department or unit. Most law
enforcement and firefighting personnel are covered under Labor
Code 4800 and receive benefits equal to their full salary.”

There’s been great concern about employers at the precedent that would be set with presumptions being extended to private employers. And there is concern about the costs to the state that the bill would entail.

Another bill mentioned in Conway’s piece is AB 1175. But that’s not a workers’ comp bill.

Conway also mentions the controversy over fitted versus flat sheets.
That’s SB 432 (De Leon), the bill to require fitted sheets in hotels. Currently SB 432 is not set for another legislative hearing: … story.html

The text of AB 375 (which has been repeatedly amended this session) can be found here: … or=skinner

The text of SB 432 (already amended several times) can be found here: … sm_v96.pdf

What SB 432 and AB 375 appear to have in common is that they are both sponsored by powerful labor unions and both targeting specific conditions
(hospital MRSA infections and hotel housekeeper back injuries) that many believe to be linked to significant numbers of work injuries in those industries.

Since there are still going to be hotels and hospitals whether or not these bills are passed and signed, they are in and of themselves unlikely to be “job killers”. But the GOP narrative seeks to link Democrats, liberals and the legislature to the concept of job killer. That’s a dangerous position for a politician to be in these days.

That’s the dilemma for the Brown Administration as we head towards the end of the legislative year.

Stay tuned.

Julius Young

Category: Political developments