Workers Comp Zone


In a couple of days your doorbell will be ringing. Halloween will be here.

The Mummy will be at your doorstep along with R2D2, Jack the Ripper, Spock, Frankenstein and Zombies from Night of the Living Dead.

California has a new kind of trick or treater this year, though. The Mungers.
Molly and Charles, wealthy siblings.

Charles Jr. contributed $22 million this week to the Small Business Action Committee, a group that opposes Prop 30, Jerry Brown’s tax initiative, and supports Prop 32, which would kneecap labor’s political influence in Sacramento. Munger’s total contributions to that group are $36.5 million.

Sister Molly Munger has dumped $47.4 million into Prop 38, a competing tax increase measure that would dedicate revenues to California schools.
Prop 38 is headed for certain defeat but its big ad budget has created stiff headwinds for Prop 30.

California’s political consultants, ad agencies and TV outlets are feasting on this orgy of spending, of course.

But it spells trouble for Prop 30, Governor Brown’s tax plan. After taking a hit from both Mungers, Prop 30 is quite likely under water for good.

All year, Brown’s strategy has been to reach out to business in an effort to neutralize opposition to his revenue initiative. The SB 863 workers’ comp reform was part of this.

But what lies ahead for California workers’ comp if Prop 30 fails?

We’d likely see the DIR/DWC receiving significant budget cuts. We’ve been down this road before. Although the system is user funded, Schwarzenegger’s administration refused to exempt the WCAB from personnel furloughs. There’s little reason to think that the Brown administration would do things differently.

In theory, SB 863 may over time reduce the workload of the WCAB. Why?
Medical disputes would largely be handled by Independent Medical Review, not by expedited hearings over medical issues with WCAB judges. New rules concerning liens will likely reduce the amount of liens in the future. Independent Bill Review will siphon off billing disputes that would otherwise wind up in hearings over liens. Vocational experts will render reports rather than live testimony.

Eventually, there will be less issues coming to judges.

But most of that is down the pike, so any cuts imposed if Prop 30 fails will have an impact on current cases.

Brown has said that without more revenue, California faces a “war of all against all”, meaning that interest groups will struggle mightily to protect their state programs at the expense of other worthy state programs.

Spending on other DIR programs would likely take a hit, as would programs such as the California Department of Rehabilitation and the California Department of Fair Employment and Housing.

So don’t be surprised if next year you see some Munger masks at your door.

Trick or treat.

Stay tuned. In a coming post I’ll muse about the impacts of the presidential election on the California comp system.

Julius Young

Category: Political developments