That strange odor you may smell from the general direction of Sacramento is a deal cooking on increasing permanent disability benefits. Consistent with the way workers’ compensation issues have been addressed in this decade so far, data are in the driver’s seat, with employers and labor trying to figure out what’s coming up on the road ahead.
Indeed, one can only imagine what the actual negotiations might look like because both sides are glued to their laptops trying to divine the meaning behind the latest batch of statistics. Maybe they can email each other their positions.
The empirically driven policy decisions underlying recent reform laws are a substantial improvement over the anecdotal efforts Sacramento was more known for in prior efforts. But when it comes to permanent disability, the debate over the meaning of data has eclipsed the debate over what permanent disability is supposed to accomplish in California’s still highly complex workers’ compensation system.
Linking return-to-work outcomes with permanent disability benefit adequacy has unleashed a plethora of proposals to improve return-to-work opportunities, which in turn involves the role of the treating physician and requires the employer’s active participation early in the life of a disabling claim.
Then there is the issue of the Fair Employment and Housing Act (FEHA) and exposure to liability under that set of laws if the employer does not work with the injured worker in an effort to accommodate the disability. If that weren’t enough, there is also the question of how to facilitate a worker getting a job with any employer, not just the employer at the time of injury.
This latter concept would be particularly beneficial to the small employer whose ability to keep jobs open during the period of rehabilitation is acknowledged to be very limited, but also involves coordinating the multitude of public and private job training and placement services available to individuals with disabilities.
Maybe the PD issue can be resolved within the context of the 24-hour coverage debate, as suggested by the governor’s still-nascent proposal that would turn State Compensation Insurance Fund into a disability manager for public (and private) entities that opt to participate in the proposed integrated medical benefit program.
Doctors deal with work restrictions all the time, so perhaps the integrated benefit will allow for a better assessment of disability, better coordination of light duty and accommodation of work restrictions, and better return-to-work outcomes. Maybe. Of course, that’s why it is a pilot project, so policymakers can get data needed to make a decision.
We know that those not considered permanently disabled would have received a PD award prior to 2004. We also know that in many – but not all – disabling injuries, PD awards are now significantly lower than they were prior to 2004. We also know that the maximum wage a permanent partial disability award is based on is about $18,000, less than half of the statewide average weekly wage.
When the workers’ compensation system was established nearly a century ago, the permanent disability benefit was intended to provide an adequate wage replacement during the period of time the legislature thought was needed to reenter the workforce. It would seem, today, that the wisdom of that policy decision still holds true.
Rather than re-engineering the system yet again, employers and labor would be better served by arriving at an adequate PD benefit level and not embark on complicated legislative or regulatory adventures that may not produce the desired result.
In other words, keep it simple, s—–.