Provision in New Workers’ Compensation Law on Age-Related Conditions Could Reduce Benefits

A "key part" of a workers' compensation law (SB 899) enacted this year could cost injured workers tens of thousands of dollars in benefits in cases in which physicians find that their workplace injuries resulted in part from age-related conditions such as arthritis and osteoporosis, the AP/Modesto Bee reports. Treatment guidelines included in the new law, under which body weight and whether a woman has given birth also could affect workers' compensation benefits, have delayed or re-opened some claims filed by injured workers and "brought a flood of rejection notices from insurers," the AP/Bee reports.

Meanwhile, the law has not "made a huge dent" in the cost of workers' compensation insurance, the AP/Bee reports (Lawrence, AP/Modesto Bee, 7/27). Insurance Commissioner John Garamendi (D) earlier this month announced that workers' compensation insurance premium rates have decreased by 10.38% since the enactment of the law and other reform measures; Garamendi in May recommended a premium rate reduction of 20.9% (California Healthline, 7/14). Sen. Richard Alarcon (D-Van Nuys), who supports state regulation of workers' compensation insurance premium rates, said, "I think this is going to go down as one of the biggest insurance company rip-offs of all time." However, supporters of the law and the reform measures maintain that "it's too early" to determine their effect on workers' compensation benefits and insurance premium rates, the AP/Bee reports.

Nicole Mahrt, a spokesperson for the American Insurance Association, said, "I think companies are cutting rates as much as they are able to, given that we haven't seen all the savings from these reforms yet. I think carriers are reducing rates based on faith." Sen. Chuck Poochigian (R-Fresno), who sponsored the legislation, said, "When all is said and done and we are a year or two down the road and say it's still a crisis and rates have not come down adequately, obviously we are going to look for further ways to bring about a system that isn't harmful to enterprise" (AP/Modesto Bee, 7/27).