June 4, 2008

Setting Limits in California

California had a long-standing reputation as a workers compensation nightmare: not because injured employees received generous benefits - they did not - but because doctors and lawyers exploited the system to generate enormous fees. Governor Schwarzenegger, AKA the Terminator, put an end to that with his extensive 2003-04 reforms. In the effort to contain costs, the reforms for the first time brought managed care tools into the comp system. The bottom line for employers has improved dramatically.

Among the many provisions of the reform was a limit on physical and occupational therapy treatments for an injury. Injured workers are now limited to 24 visits. Jose Facundo-Guerrero, a worker at a nursery in Half Moon Bay, challenged the limits on constitutinal grounds, alleging that he was entitled to the "full provision for such medical, surgical, hospital and other remedial treatment" promised in the CA Constitution. Jose had visited his chiropractor 76 times and he wanted the carrier to pay.

The First District Court of Appeal in San Francisco has upheld the limits in the comp reform package. They found that the Constitution does not require "unlimited" treatments and leaves the details up to the legislature.

Arbitrary Limits
There is no question that the 24 visit limit is arbitrary. This one size does not fit all. On the other hand, chiropractic treatment can be addicting. It feels good. Jose went 76 times and might well have continued on indefinitely, had the treatments been compensable.

One aspect of the reform language caught my eye: the 24 visit limit can be exceeded if the employer agrees. This raises an intriguing possibility. If valued employees require extensive physical therapy that goes beyond the arbitrary limit, enlightened employers might well authorize the carrier to cover a specific number of additional visits. This makes sense as long as it keeps the employee happy and productive.

As with so many workers comp issues, law makers struggle to find the middle ground between no limits and severely curtailed treatments. What's missing is reliable and effective lines of communication among employers, their employees, medical providers and insurance carriers. The rigid limits on treatment in California are apparently legal, but that does not mean they are fair. There is no question that the reforms of 2003-04 have reduced costs. Ironically, injured workers were not the primary beneficiaries of the state's pre-reform, out-of-control comp system. And it now appears likely that these same workers will pay the price for reforms as well.

| 4 Comments

4 Comments

Employers rarely want to pay for anything for injured workers if they can find an "out". They delay treatment that could get the injured worker back on the job.

I am familiar with the CA system, but I am from MA. Here an injured worker needs to have a "conciliation" followed by a "conference" for nearly everything, it seems.

The quasi-state system we have here has been well crafted to keep the "machine" going for those employed by it or who have a hand in it, but not for the injured worker.

Arbitary limits will always be part of workers compensation -thats because of budgets etc. The issue is weather the system can cope with the needs of workers who go outside the limits. In most Australian States we have limits on spending for medicals and rehab - BUT we allow workers to apply to a tribunal to show cause to extend the limits to cover additional costs. So this is not in the hands of an employer who may for what ever reason withold consent. The Califorian system could easily deal with this issue by allowing an extension of payments with the consetn of the employer OR upon application to a tribunal for an order to pay a certain amount of proven effective treatments

It's important to make a distinction between benefits received and nominal benefit levels. The pre-reform CA system didn't have high nominal benefits (nor does the current one) but benefits received were well above those for the nation as a whole. http://www.nasi.org/publications2763/publications_show.htm?doc_id=286021
I agree with you on the need for flexibility with treatment limits, but surely only a tiny fraction of cases would derive substantial benefit from over 24 chiropractic treatments. CA (post-reform)also has a 2-year limit on temporary disability, which seems more likely to be arbitrarily harsh in its application.

Informative article on "Setting Limits in California". I have been wondering and looking for answers to certain questions and I must say I was lucky to reach your article. It has cleared most of my doubts. Also I must add that I would closely follow your blog in the future and I am sure I would not be disappointed.

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This page contains a single entry by Jon Coppelman published on June 4, 2008 10:31 AM.

Firefighters revisited: Presumption's Slippery Slope was the previous entry in this blog.

News roundup: Cavalcade of Risk, disease mongering, claims adjusting, crane safety, and more is the next entry in this blog.

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