Subject: Studies in the News 03-79 (November 25, 2003)


CALIFORNIA RESEARCH BUREAU
CALIFORNIA STATE LIBRARY
Studies in the News:
Workers' Compensation Supplement


Due to the current interest in Workers' Compensation reform, we have compiled a one time (or maybe few times) collection of relevant materials for your wonkish pleasure.

Introductory Material EMPLOYMENT
   Workers' compensation basics
   California seeks to rehabilitate a social contract
   Improving dispute resolution
   Health care fee schedule for workers' compensation
   Compensating workplace injuries
   Simplifying medical payment for workers' compensation
   Improving care quality
   Utilization review of workers' compensation system
   Federal workers' compensation information
   Crucial issues facing workers' compensation
   Workers' compensation and the legislative outlook
   Workers' compensation analysis
   State workers' compensation trends
   50 State comparisons of workers' compensation law
   State comparisons of workers' compensation
   Workers' compensation rate hikes
   Insurance companies target California workers' compensation
   Workers' compensation under alternative insurance arrangements
   Smallpox and workers' compensation
   Policy and procedure manual
   50 states' workers compensation pages
   Lawsuit on tribal workers' compensation
PREVIOUSLY IN STUDIES IN THE NEWS
   Workers' compensation inpatient care
   Workers' compensation 'carve outs'
   Chiropractic care and workmen's compensation
   Workers' compensation outcomes
   Trends in earning loss from workplace injuries
   State report card for workers' compensation
   Employer costs for employee compensation
   Cost of workers' compensation claims
   Workers' compensation system's cost
   Workers' compensation reform laws
Introduction to Studies in the News

Studies in the News is a very current compilation of items significant to the Legislature and Governor's Office. It is created weekly by the State Library's Research Bureau to supplement the public policy debate in California’s Capitol. To help share the latest information with state policymakers, these reading lists are now being made accessible through the State Library’s website. This week's list of current articles in various public policy areas is presented below.

Service to State Employees:

  • When available, the URL for the full text of each item is provided.

  • Items in the State Library collection can be checked out to state officials and staff.

  • Access to all materials listed will be provided by the State Information Reference Center, either by e-mail to cslsirc@library.ca.gov or by calling 654-0261.

The following studies are currently on hand:

EMPLOYMENT

WORKERS COMPENSATION

The California Workers' Compensation System. By The Division of Workers' Compensation, California Department of Industrial Relations (The Department, Sacramento, California) 2003. 5 p.

Full Text at: www.dir.ca.gov/dwc/basics.htm

["Workers' compensation is the oldest social insurance program; it was adopted in most states, including California, during the second decade of this century. It is a no-fault system, meaning that injured employees need not prove the injury was someone else's fault in order to receive workers' compensation benefits for an on-the-job injury."]

[Request #S9625]

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Injured on The Job: California Seeks to Rehabilitate a Social Contract. By Nicholas M. Pace and Robert T. Reville, RAND Institute of Civil Justice. IN: RAND Review, vol. 27, no. 2 (Summer 2003) pp. 1-6.

Full Text at: www.rand.org/publications/randreview/issues/summer2003/injured.html

["RAND Corporation conducted a top-to-bottom review of the California workers' compensation courts to gain a better understanding of the causes of delay, the reasons for the high costs, and the sources of procedural inconsistencies. Although [the authors] identified numerous sources of these problems, [the authors] found that many of them ultimately stem from decades of underfunding in the areas of staffing and technological improvements."]

[Request #S9626]

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Improving Dispute Resolution for California's Injured Workers and Executive Summary. By Nicholas M. Pace and others, The Rand Institute for Civil Justice. Prepared for the California Commission on Health and Safety and Workers' Compensation (Rand, Santa Monica, California) 2003. 739 p.; 31 p.

Full Text at: www.rand.org/publications/MR/MR1425/index.html

["A comprehensive analysis of the trial level operations of the Workers' Compensation Appeals Board and the support and supervision of those operations provided by the California Division of Workers Compensation. The Institute for Civil Justice study team focused on how the courts work, why they work the way they do, and how they can be improved."]

[Request #S9628]

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Adopting Medicare Fee Schedules: Consideration for the California Workers' Compensation Program: Executive Summary. By Barbara O. Wynn. MR-1776.0-ICJ. (RAND, Santa Monica, California. 2003) 16 p.

Full Text at: www.rand.org/publications/MR/MR1776.0/MR1776.0.sum.pdf

["(The study) ... explores issues arising from the proposed linking of the California workers' compensation health care fee schedule to Medicare fee schedules.... Potential payment changes are quite large for some service sectors and may require a transition period to allow providers time to adjust to the new payment levels."]

[Request #S9629]

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Compensating Permanent Workplace Injuries: A Study of the California System. By Mark A. Peterson and others, Institute for Civil Justice, RAND. Prepared for the Commission on Health and Safety and Workers' Compensation. (RAND, Santa Monica, California) 1998. 227 p.

["Over 300,000 workers each year receive benefits for work-related injuries resulting in billions of dollars in paid benefits... Buffeted by significant legislative reforms in 1989 and 1993, as well as frequent and ongoing administrative changes, system participants complain that confusion, complexity and delay are the main constants in the system."

[Request #S9630]

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Workers' Compensation Medical Payment Systems: A Proposal for Simplification and Administrative Efficiency. By the California Commission on Health and Safety and Workers’ Compensation. Prepared for the California Senate Committee on Labor and Industrial Relations (The Commission, Sacramento, California) August 23, 2003. 102 p.

Full Text at: www.dir.ca.gov/CHSWC/CHSWC_WCMedicalPaymentSystem/CHSWC_WCMedicalPaymentSystem.pdf

["The current system for workers’ compensation medical care payments in California is unnecessarily complex, costly, difficult to administer, and, in some cases, outdated.... This paper describes the current system and proposes a solution intended to result in system simplification and administrative efficiency.

[Request #S9631]

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Improving the Quality of Care for Injured Workers in California: Focus Group Discussions. By Linda Rudolph, Division of Workers Compensation, California Department of Industrial Relations; and others (The Department, Sacramento, California) November 2001. 44 p.

Full Text at: www.dir.ca.gov/dwc/fogrprpt.pdf

["The specific aim of the focus groups was to understand diverse perspectives of participants in the workers’ compensation system concerning quality of care for workers injured on the job. The focus groups looked at quality of care in the general health care system, and for injured workers in particular."]

[Request #S9632]

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Utilization Review in California's Workers' Compensation System: A Preliminary Assessment. By Linda Rudolph and Kathy Dervin, Division of Workers' Compensation, California Department of Industrial Relations; and Joshua Linford-Steinfeld, Public Health Institute (The Department, Sacramento, California) July 2001. 25 p.

Full Text at: www.dir.ca.gov/dwc/URreport.pdf

["The goals of the assessment were to: (1) Review the summaries of utilization review (UR) plans of California’s largest workers’ compensation claims administrators, to learn more about UR in our workers’ compensation system; (2) Review the published literature with regard to the impact of utilization review on health care services and/or quality; and (3) Identify significant differences between DWC’s utilization review standards and the standards governing utilization review in other California health care systems or in private accreditation programs."]

[Request #S9634]

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Office of Workers' Compensation Programs: Home Page and Benefit Tables. By the Office of Workers' Compensation, Employment Standards Administration, U.S. Department of Labor (The Department, Washington, DC) 2003. Various pagings.

O.W.C. Home Page:
http://www.dol.gov/esa/owcp_org.htm
Benefit Tables:
http://www.dol.gov/esa/regs/statutes/owcp/stwclaw/stwclaw.htm

[Request #S9635]

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Critical Issues Facing Workers Compensation. By Stephen J. Klingel, National Council on Compensation Insurance, Inc. (The Council, Boca Raton, Florida) 2003. 8 p.

Full Text at: www.ncci.com/media/pdf/criticalissuesworkcomp.pdf

["From terrorism to rising medical costs to growth in the residual market, industry stakeholders are dealing with a wide range of critical issues. In this piece, [the authors] review several of the most crucial topics facing the workers compensation industry today. Analysis of the economic factors influencing our industry and the specific financial results of our line are examined separately in this publication."]

[Request #S9636]

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2003 State Legislative Outlook. By Gregory W. Heidrich, Alliance of American Insurers (National Council on Compensation Insurance, Inc., Boca Raton, Florida) 2003. 4 p.

Full Text at: www.ncci.com/media/pdf/legislativeoutlook.pdf

["As it usually happens, the 50 state legislatures are producing a potpourri of workers compensation legislation this year. However, what’s adding a different element to the typical variety of proposals has been the number of new governors and new insurance commissioners, legislatures transformed by turnover, and the effects of the ongoing economic weakness. In addition, workers compensation carriers continue to have important federal interests and issues."]

[Request #S9637]

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State of the Line: Analysis of Workers Compensation Results. By Dennis C. Mealy, National Council on Compensation Insurance, Inc. (The Council, Boca Raton, Florida) 2003. 8 p.

Full Text at: www.ncci.com/media/pdf/sotl2003.pdf

["Each spring, NCCI prepares and publishes the “State of the Line”—[an] analysis and reporting on the trends, forces and economic realities that shape [the] outlook for the workers compensation market for the year ahead. This year, [the] outlook offers both positive and negative findings. Considered in total, profitability for the workers compensation line will continue to be elusive for many carriers and the outlook for the future is cautionary."]

[Request #S9638]

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State Workers' Compensation Trends. By AFL-CIO Department of Occupational Health and Safety (The Department, Washington, DC) 2003. 2 p.

Full Text at: www.aflcio.org/yourjobeconomy/safety/wc/statetrends.cfm

["Terrorism and the continued debacle on Wall Street were driving forces in state workers’ compensation programs during 2002. After winning significant cuts in benefits during the first half of the 1990’s, workers’ compensation insurers were so flush with cash from ballooning stock prices, they cut premiums to attract new customers... When the bubble burst, however, all property and casualty insurers were faced with the need to increase reserves to meet anticipated claims... Arriving as they did in the midst of a recession, premium increases were a significant burden to businesses coping with declining orders and sales."]

[Request #S9639]

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Workers' Compensation Under State Laws, January 1, 2003. By AFL-CIO Department of Occupational Health and Safety (The Department, Washington, DC) 2003. 3 p.

Full Text at: www.aflcio.org/yourjobeconomy/safety/wc/upload/unemploy.pdf

["50 State comparison of workers' compensation law. Table headings include: "Coverage of Agricultural Workers;" "Maximum Weekly Benefit Allowed;" "Coverage of Domestic Workers;" and more.]

[Request #S9640]

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Workers' Compensation Comparisons, 2001. By AFL-CIO Department of Occupational Health and Safety (The Department, Washington, DC) 2003. 4 p.

Full Text at: www.aflcio.org/yourjobeconomy/safety/wc/upload/comptable.pdf

["50 State comparison of workers' compensation. Table headings include: "Choice of Doctor;" " Benefits for Loss of Hand;" "Maximum Weekly Survivor Benefit" and more.]

[Request #S9641]

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Insurance Company Rate Hikes Force Comp Cuts: Leaders Call For Insurance Reform. By AFL-CIO Department of Occupational Health and Safety. IN: Workers' Compensation Notes (August 2003) pp. 1-2

Full Text at: www.aflcio.org/yourjobeconomy/safety/wc/wc_notes.cfm

["Around the country, insurance company rate hikes have forced states to cut workers’ compensation benefits, according to AFL-CIO and Workplace Injury Litigation Group (WILG) leaders attending a national Workers’ Voice meeting in San Francisco."]

[Request #S9642]

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Insurance Companies Target California Comp. By AFL-CIO Department of Occupational Health and Safety. IN: Workers' Compensation Notes (August 2002) pp. 1-4

Full Text at: www.aflcio.org/yourjobeconomy/safety/wc/wc_notes_082002.cfm

["Less than two months after Gov. Gray Davis approved a $112 weekly increase in the state’s $490 benefits for injured workers, insurance companies, among the nation’s top donors to races for governor and president, have begun a full-court press to cut benefits and raise rates. At the same time, California’s workers’ compensation insurers are taking advantage of what they call a 'hard market' (conditions favor sellers) by raising their rates. Small businesses in northern California report rate increases of 50 percent."]

[Request #S9643]

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Worker's Compensation: Benefits, Costs, and Safety under Alternative Insurance Arrangements. Terry Thomason and others (Upjohn Institute, Kalamazoo, Missouri) 2001. 457 p.

Available at California State Library HD7103.65.U6 T48 2000

[Request #S9644]

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Smallpox First Responders Win Compensation Law. By AFL-CIO Department of Occupational Health and Safety. IN: Workers' Compensation Notes (May 2003) 8 p.

Full Text at: www.aflcio.org/yourjobeconomy/safety/wc/wc_notes_052003.cfm

["President Bush touched off a furious debate over the adequacy of workers’ compensation programs when he announced the Smallpox Vaccination Program to combat bioterrorism on Dec. 13, 2002. Four months after the program was launched, after three workers had died from heart attacks attributed to the smallpox vaccine, Congress finally enacted a new national smallpox compensation program."]

[Request #S9645]

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Worker's Compensation Appeals Board: Policy and Procedural Manual. By the Workers' Compensation Appeals Board, California Department of Industrial Relations (The Department, Sacramento, California) 2003. 50 p.

Full Text at: www.dir.ca.gov/wcab/wcab_policy_proceduremanual/Policy_andProcedure_Manual.pdf

[Administrative law provides insight on programs at the working level.]

[Request #S9646]

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All 50 States' and D.C.'s Home Pages and Workers' Compensation Agencies. by Robert W. McDowell (North Carolina Industrial Commission, Raleigh, N.C.) 2003. 1 p.

Full Text at: http://www.comp.state.nc.us/ncic/pages/all50.htm

Workers Compensation Administrators Directory has up-to-date links to web site for the 50 states and the District of Columbia.

[Request #S9649]

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Mainstay Business Solutions vs. John Garamendi, California Insurance Commissioner. Superior Court of the State of California for the County of San Francisco. Petition for Writ of Mandate. 32 p.

["Mainstay has sued the state in ... superior court, saying sovereign immunity extends beyond reservation boundaries.... Mainstay's lawsuit says the state is 'attempting to shut down a legal and honorable enterprise which assists a tribe in providing much-needed services to the community in economically troubling times.' .... Michael Hansen, chief executive of Mainstay. said Mainstay's program cuts workers' comp costs by using a cost-conscious doctor network and running disputes over treatment through a tribal appeals court, which trims litigation expenses. Mainstay Business says the program is legitimate -- and 25 percent cheaper than conventional coverage..... experts on Indian law say the case is a gray area. They say sovereign immunity might not completely shield the tribe from state oversight. But it's an issue that's sure to crop up again as Indian tribes flex their economic muscles and expand into off-reservation businesses. "]

[Request #S9652]

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PREVIOUSLY IN STUDIES IN THE NEWS
[This section links to items in Studies in the News since the last Workers' Compesation Supplement.]

Clinical Severity in Workers' Compensation Inpatient Care. By the California Workers' Compensation Institute. (The Institute, Oakland, California) July 2001. 16 p.

["This study utilized multiple measures of severity to examine the assertion that a workers' compensation patient is somehow more clinically severe or more resource intensive than a patient in the group health or Medicare sectors. The results show just the opposite.... This research provides objective data that can be used to establish a 'fair price' for one of the major medical cost drivers in the California system."]

[Request #S2151]

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"'Carve-Outs' from the Workers' Compensation System." By David I. Levine and others. IN: Journal of Policy Analysis and Management, vol. 21, no. 3 (2002) pp. 467-483.

["This study examines one innovative form of decentralized self-regulation -- workers' compensation in the California construction industry. In California and 11 other states, construction unions and management can bargain to create an alternative workers' compensation system (a 'carve-out') that replaces much of the state run system."]

[Request #S6241]

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Changes in Utilization of Chiropractic Care in California Workers' Compensation, 1993-2000. By the California Workers' Compensation Institute. CWCI Research Report. (The Institute, Oakland, California) March 21, 2003. 8 p.

["Insurers' annual payments to chiropractors jumped from $77 million to $195 million during the period [1996 to 2001]. As a result, chiropractors surpassed clinics, orthopedists, and physical therapists to become the number one classified medical specialty group tendering treatment.... Debate over the cost and utilization of chiropractic care is likely to heat up in the 2003 legislative session."]

[Request #S7818]

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Provider Experience and Volume-Based Outcomes in California Workers' Compensation: Does "Practice Make Perfect?" By Alex Swedlow and Laura B. Gardner, California Workers' Compensation Institute. (The Institute, Oakland, California) February 2003. 17 p.

["The study focuses on 39,248 providers who rendered treatment in 1.1 million workers' compensation claims for injuries and illnesses that occurred between 1993 and 2000.... The hypothesis of this study was that providers with more experience treating patients in the workers' compensation system achieved better outcomes, reflected in lower medical care and indemnity costs."]

[Request #S7875]

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Trends In Earnings Loss From Disabling Workplace Injuries In California: The Role Of Economic Conditions. By Robert T. Reville and others. (RAND, Santa Monica, California) 2003. 60 p.

Full Text at: www.rand.org/publications/MR/MR1457/MR1457.pdf

["California's workers' compensation system is understaffed, has an antiquated computer system and lacks standardized procedures ... The report ... found that most of the one million claims appeals filed in California each year take 'significantly longer' than the time frames mandated by state law."] California Healthline, April 4, 2003. [online.]

[Request #S7994]

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State Report Card for Workers' Comp: Press Release. By the Work Loss Data Institute (The Institute, ) 2003. 1 p.

Full Text at: www.disabilitydurations.com/pr_repsrc.htm

["California's workers' compensation system earned an 'F' for effectiveness in a recent study based on injuries and illnesses recorded on a log required by federal law. The study of all states looked at data recorded on the OSHA Form 200 to rate the performance of each state's workers' compensation system." California Association for Local Economic Development Bulletin (April 2003) p. 1.]

[Request #S8279]

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Employer Costs For Employee Compensation. By The U.S. Department of Labor. USDL: 03-130. (The Department, Washington, DC) March 18, 2003. Various pagings.

Full Text at: www.bls.gov/news.release/ecec.toc.htm

["In December 2002, employer costs for employee compensation for civilian workers in private industry and state and local government averaged $23.66 per hour worked.... Wages and salaries, which averaged $17.06, accounted for 72.1 percent of these acosts, while benefits, which averaged $6.60, accounted for the remaining 27.9 percent."]

[Request #S8547]

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Los Angeles County Civil Grand Jury Final Report: 2002-2003. By County of Los Angeles. (The County, Los Angeles, California) 2003. 339 p.

Full Text at: grandjury.co.la.ca.us/gjury02-03/grandjury02-03.pdf

[“A new report by the Los Angeles County Grand Jury puts a staggering price tag on the cost of workers' compensation claims for public safety agencies. According to the report, workers' compensation costs in the county Fire and Sheriff's departments and the city of Los Angeles Fire Department have nearly doubled over the last five years, with the most dramatic spike in the Sheriff's Department. Annual workers' compensation payments in the 14,000-member department rocketed from $48.5 million in 1998 to $93.4 million in 2002, a 92% increase, while over the same period the number of sheriff's employees has increased only 16%.” Los Angeles Times (June 28, 2003) 1.]

[Request #S8579]

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California's Workers' Compensation Program: The Medical Payment System Does Not Adequately Control the Costs to Employers to Treat Injured Workers or Allow for Adequate Monitoring of System Costs and Patient Care. By the Bureau of State Audits, California State Auditor. (The Bureau, Sacramento, California) August 2003. 159 p.

Full Text at: www.bsa.ca.gov/bsa/pdfs/2003-108.1.pdf

["Workers' comp-related medical costs have climbed more than 250 percent in the past decade and totaled $5.7 billion in 2002, according to the report.... To help control costs in the future, the auditor recommended the state adopt a medical fee schedule, set up medical treatment guidelines and improve its monitoring system -- an endorsement of many of the reforms proposed by lawmakers." Sacramento Bee (August 28, 2003) A1.]

[Request #S8969]

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Summary of 2003 Legislative Reform (AB 227 and SB 228). By the California Workers' Compensation Institute. (The Institute, Oakland, California) September 24, 2003. 16 p.

["After reviewing the legislative 'overhaul' of the workers' compensation system passed by the legislature, the Institute has produced a summary of the key provisions, including the appropriate Labor Code and Insurance code sections. The conference committee estimated the bills would produce a one-time savings of $5.3 billion and ongoing savings of $4.892 billion to $5.592 billion." CWCI Bulletin (September 26, 2003) 1.]

[Request #S9346]

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