CalPERS Committee Endorses Legislative Proposal To Address Medical Pension Fraud
A nine member CalPERS committee on Tuesday unanimously endorsed a proposal for legislation that would revise the disability pension law for state workers and employees of local governments who are part of the system by granting CalPERS fewer limits on its fraud investigations and penalties, the Sacramento Bee reports. The proposal was prompted by articles in the Bee earlier this year that raised questions about the use of medical pensions, especially among employees of the California Highway Patrol who are at or near retirement age. If approved, the proposed legislation would implement changes suggested by Gov. Arnold Schwarzenegger's (R) California Performance Review. The proposal would:
- Clarify the definition of fraud for medical pensions and establish civil and criminal penalties, similar to the recent workers' compensation insurance reforms. CalPERS currently can charge people only with grand theft, which carries a higher burden of proof than fraud;
- Permit CalPERS to order employees who are past retirement age to submit to medical exams to determine if they are still disabled; and
- Allow CalPERS investigators to review state employment records to determine whether former workers collecting medical pensions are working in jobs that would be difficult to perform with their injuries.
The full 13-member CalPERS board is expected to approve the proposal on Wednesday, the Bee reports. CalPERS would then seek out a lawmaker to introduce the legislation in January.
Jarvio Grevious, CalPERS' deputy executive officer for benefits administration, said, "The idea is to give us a greater ability to prevent fraud and to improve the integrity of our benefits program."
Bob Walton, a CalPERS assistant executive officer, said in a prepared statement, "We have been investigating potential fraudulent activity for more than 20 years, but the law has always hampered our ability to penalize those who deceive the system. This proposal will strengthen our ability to expose abusers" (Hill, Sacramento Bee, 12/15).