The amount that employers' costs will decrease under an overhaul of California's workers' compensation system will depend largely on how state officials implement new system rules, according to a filing from the Workers' Compensation Insurance Rating Bureau, Sacramento Bee's "Capitol Alert" reports.
WCIRB submitted the filing to California Insurance Commissioner Dave Jones (D) this week (Walters, "Capitol Alert," Sacramento Bee, 10/2).
Last month, Gov. Jerry Brown (D) signed into law legislation (SB 863) that overhauls the state's workers' compensation system.
The bill -- by Sens. Kevin de León (D-Los Angeles) and Jose Solorio (D-Anaheim) -- changes the formula used to calculate benefits for injured workers, increasing their compensation by an average of 29%.
It also eliminates benefits for certain health conditions that often are subject to lawsuits, such as psychiatric problems, sexual dysfunction and sleep loss.
The State Compensation Insurance Fund said employers likely will pay less for workers' compensation insurance under the law.
According to de León, savings from the law will help raise benefits for permanently disabled workers (California Healthline, 9/19).
In August, WCIRB released a study that found that SB 863 could produce savings of about $400 million (California Healthline, 8/28).
Details of Filing
In its filing, WCIRB said that losses to workers' compensation insurers still are increasing ahead of implementation of the overhaul, making it difficult to recommend to Jones how premiums should be adjusted.
Therefore, the agency is recommending no changes to premiums next year to allow more time for the implementation and assessment of the overhaul.
Jones plans to schedule a public hearing on WCIRB's recommendation ("Capitol Alert," Sacramento Bee, 10/2).