Approval of Propositions 57, 58 Could Boost Governor’s Plans for Workers’ Compensation Reform, State Budget
The passage of Propositions 57 and 58 demonstrates the "power of [Gov. Arnold Schwarzenegger's (R)] celebrity and salesmanship" and increases the governor's clout in the battle over his "ambitious plan" to reform the state's workers' compensation system, the New York Times reports (Broder, New York Times, 3/3). With 100% of precincts reporting, Proposition 57 passed with 63.3% of the vote and Proposition 58 passed with 71% (California Secretary of State release, 3/2). Proposition 57 is a $15 billion bond measure to help the state refinance its deficit, and Proposition 58 is a mandate to balance the state budget (California Healthline, 2/6). As part of his "California Recovery Plan," Schwarzenegger in November proposed reducing by $11.3 billion the cost of the state's $29 billion workers' compensation program. Schwarzenegger's plan includes measures that would prohibit workers from receiving multiple disability payments for the same injury; require dispute resolution more frequently to reduce litigation costs; limit penalties paid by insurers and employers in medical bill disputes; and establish uniform standards for permanent disability. During his State of the State address earlier this year, Schwarzenegger said he would seek to place a measure on the November statewide ballot if legislators did not pass reform legislation by March 1. However, Democrats in the Legislature have said that no workers' compensation reforms will be ready until the end of March (California Healthline, 3/2). NPR's "Morning Edition" Wednesday reported on the passage of Schwarzenegger's budget plan. According to NPR, the victory will allow Schwarzenegger "to make good on his threat to take his agenda directly to the people if the Legislature doesn't play ball" on issues such as workers' compensation reform. The segment includes comments from Treasurer Phil Angelides (D), Schwarzenegger campaign spokesperson Todd Harris and Schwarzenegger (Jaffe, "Morning Edition," NPR, 3/3). The complete segment is available online in RealPlayer.
With the "significant political victory," aides for Schwarzenegger said that the governor "would turn with vigor to reforming the state's workers' compensation system," the San Francisco Chronicle reports (Salladay/Gledhill, San Francisco Chronicle, 3/3). Tony Quinn, a political analyst and co-editor of the campaign digest California Target Book, said that Schwarzenegger now has "the upper hand on workers' compensation as well as on the budget," the Stockton Record reports. "This is about the perception that he's going to govern through a combination of personality and celebrity," Quinn said, adding, "This is going to prove to the Legislature that he can change the public's opinion. It shows that they'll have to deal with him on his terms" (Shuck, Stockton Record, 3/3).
The AP/Las Vegas Sun reports that the passage of the propositions will give Schwarzenegger "the advantage in pending negotiations over everything from how to trim public health costs to reforming the workers' compensation system." The passage of the propositions also will allow Schwarzenegger to "avoid -- for now -- proposing social service cuts that would have triggered a bruising showdown with the Democrat-dominated Legislature," according to the AP/Sun (Chorneau, AP/Las Vegas Sun, 3/3). However, the state could still face a budged deficit of $4 billion at the end of fiscal year 2004-2005, according to Legislative Analyst Elizabeth Hill, the Los Angeles Times reports. The deficit is largely because Schwarzenegger's budget "relies on some suspect assumptions," the Times reports. According to the Times, the "hundreds of millions of dollars" in cuts to Medi-Cal might violate federal regulations. The Legislature and the governor have until June 30 to adopt a spending plan under the state constitution (Halper/Rabin, Los Angeles Times, 3/3).
The "practical impact of Schwarzenegger's win" on the passage of Propositions 57 and 58 may "be to strengthen his political standing as he deals with the polarized Capitol, not only on the budget but on other major issues, such as overhauling the much-troubled workers' compensation system," columnist Dan Walters writes in a Sacramento Bee opinion piece. According to Walters, Schwarzenegger "now has the track record to back ... up" his threat to pursue a ballot measure to reform the workers' compensation system, for which petitions will begin to circulate this week (Walters, Sacramento Bee, 3/3).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.