Insurance Commissioner Drops Lawsuit Against State Compensation Insurance Fund
Insurance Commissioner John Garamendi (D) has dropped a lawsuit against State Compensation Insurance Fund, according to a statement the Insurance Department released Monday, the Sacramento Bee reports (Sacramento Bee, 5/18). The suit -- which Garamendi filed in early April in state court in San Francisco -- requested that the not-for-profit insurer grant Garamendi access to all records, documents and employees. Workers' compensation reform legislation enacted last year requires Garamendi to report to the Legislature on State Fund's financial condition by July 1. Garamendi has said that he does not have enough information to review the fund's finances and to ensure that savings generated from last year's reforms are being passed to California employers through lower premiums. In September 2003, former Gov. Gray Davis (D) signed into law two worker's compensation bills (AB 227 and SB 228) that established fee schedules for treatments and prescription drugs; limited chiropractic and physical therapy visits; implemented reviews that use national standards to determine the proper amount of care for certain injuries; and increased penalties for employer fraud from $50,000 to $150,000 (California Healthline, 4/6). However, officials for State Fund, a quasi-public entity that provides workers' compensation insurance to more than 50% of California employers, have said that they have given Garamendi enough information to file the report, the Bee reports. In a statement Monday, Garamendi said that information gained from the lawsuit could not be analyzed in time to properly use it for the report. "We do not want the court to engage in what is now a pointless act," he said (Sacramento Bee, 5/18).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.