Few lofty pronouncements were made today at the rather humdrum pure premium rate hearing usually presided over by flashy Insurance Commissioner John Garamendi, who was out campaigning for Lt. Governor. The latest field polling indicates that if the primary were held today Garamendi leads by 31 percent over his opponent, Sen. Jackie Speier (D-San Mateo).

           Unless there is a California workers' comp carrier about to tank on his watch, Mr. Garamendi can enjoy a rebounding soft market thanks in no small part to the regulations implemented by the current administration. The Commissioner is expected to make a rate announcement sometime around the beginning of June.     

           It's the position of the California Applicants' Attorneys Association that any change to the Permanent Disability Rating Schedule should impact all injuries from Jan. 1, 2005 forward. Speaking at the rate hearing today on behalf of CAAA, Mark Gerlach stated the position and maintained that CAAA will continue to fight what it considers an illegal PDRS.

           The statement illustrates the uncertainty still pervading the California workers' comp market. Thankfully the legislation is on the light side this session, although the spot bills addressing permanent disability and treatment guidelines are still a wildcard. Both the industry, the Workers' Compensation Insurance Rating Bureau and the Department of Insurance can enjoy unprecedented loss ratios and declining frequency.    

           "With numbers like this there can little doubt that the reforms have decreased costs significantly," says Dave Bellusci, chief actuary of WCIRB.

           During the discussion of the Bureau's recommended 16.4 percent pure premium decrease, the Department seemed stunned by the almost 18 percent decline in indemnity claims frequency, wondering if there is a systemic issue going on. The applicants' attorneys say the claims are going elsewhere because injured workers cannot get the care they need.

           But it's just as likely that thanks to utilization review and treatment guidelines, legitimately injured workers are getting exactly the evidence-based treatment they need for work related injuries, and nothing more. In other words, the reforms are working as intended.