Workers' comp fixes left State Fund's unique status unresolved

Sac Bee ^ | 7/19/04 | Dan Walters

[NormsRevenge]

The system of compensating workers for job-related injuries and illnesses that California created nearly a century ago was a double-barreled benefit for employers.

A no-fault system would protect employers from lawsuits that injured workers otherwise might file, and a quasi-public State Compensation Insurance Fund would be an insurer of last resort and thus protect employers from arbitrary rate increases by private insurance firms.

What we have now, however, is not your grandfather's workers' compensation system. It's become very litigious and very political, and the State Fund is the insurer of first resort, writing more than half of all coverage.

When Gov. Arnold Schwarzenegger and lawmakers hammered out a workers' comp overhaul last spring, they may have reduced litigation, but they sidestepped the State Fund's status - one aspect of which has been a nasty feud between Insurance Commissioner John Garamendi and the State Fund's managers and directors over who controls the agency and its $8 billion-a-year book of business.

The feud, therefore, continues and may be intensifying, because the State Fund is not delivering, at least so far, the 20 percent-plus decreases in premiums that the governor and lawmakers had touted when they passed the reform package. The State Fund is proposing about 10 percent reductions in its customers' bills and is taking heat for not going further.

[headsonpikes]

Socialism - even Americans, ingenious as they are, cannot make it work.

[truthkeeper]

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