Business Group Proposes Workers’ Compensation Reform Initiative for November Ballot
The Small Business Action Committee, a business advocacy group that sponsored budget-related rallies held by Gov. Arnold Schwarzenegger (R) last month, has proposed including an initiative on the November ballot that would mandate several of the governor's cost cutting proposals for the state workers' compensation system, the Sacramento Bee reports. The initiative would reduce workers' compensation costs by as much as $10 billion annually, according to the committee, which is affiliated with the 38,000-member California Small Business Association (Kasler, Sacramento Bee, 1/3). As part of his "California Recovery Plan," Schwarzenegger in November proposed cutting up to $11.3 billion in funds from the state's $29 billion workers' compensation program, under which employers pay $5.85 per $100 of payroll -- the highest rate in the nation -- for coverage. 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 (California Healthline, 11/19). According to the Bee, Schwarzenegger could pursue a ballot initiative on workers' compensation reform if the Legislature does not approve his proposal. However, while the "threat" of a ballot initiative could give Schwarzenegger negotiating leverage, the state workers' compensation system "may be too complicated and esoteric for the average voter to understand," the Bee reports. In addition, other groups, such as trial attorneys or labor organizations, "may wage expensive counter initiatives, further confusing the electorate and, in the end, throw the workers' compensation system into deeper chaos," according to the Bee (Chan, Sacramento Bee, 12/28/03). KPCC's "Talk of the City" on Monday discussed Schwarzenegger's workers' compensation proposal. The segment includes comments from Insurance Commissioner John Garamendi (D), Assembly member Abel Maldonado (R-San Luis Obispo) and Sen. Charles Poochigian (R-Fresno) (Felde, "Talk of the City," KPCC, 1/5). The complete segment is available online in RealPlayer.
In related news, Schwarzenegger has opened a new campaign committee that will allow him to raise funds for ballot measures and lobbying campaigns in the Legislature, possibly including an initiative to lower the cost of workers' compensation insurance premiums for employers, the San Francisco Chronicle reports (Gledhill, San Francisco Chronicle, 1/3). The committee, called the California Recovery Team, would allow the governor to stage rallies, coordinate letter-writing campaigns to lawmakers and use other public relations techniques to promote measures. Because the California Recovery Team account is set up as a ballot measure account, it would be exempt from state limits on donations to individual candidates (Morain, Los Angeles Times, 1/1). The California Recovery Team has raised nearly $200,000 to date, $50,000 of which was from utility firm Southern California Edison and the rest of which was from out-of-state insurers. The committee is expected to be "the principal campaign vehicle" to pass Proposition 57, a $15 billion bond measure to help the state refinance its deficit, and Proposition 58, a mandate to balance the state budget. Both measures will be included on the March 2 statewide ballot. Schwarzenegger also opened a separate, new campaign committee for a potential 2006 reelection campaign (San Francisco Chronicle, 1/3).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.