BILL ANALYSIS                                                                                                                                                                                                    






                 Senate Committee on Labor and Industrial Relations
                                Carole Migden, Chair

          Date of Hearing: February 27, 2008           2007-2008 Regular  
          Session                              
          Consultant: Rodger Dillon                    Fiscal:No
                                                       Urgency: No
          
                                  Bill No: SB 1115
                                   Author: Migden
                       Version: As Introduced January 22, 2008
          

                                       SUBJECT
          
                Workers' compensation: permanent disability reports:  
                                   apportionment.


                                      KEY ISSUE

          Should language prohibiting various forms of discrimination in  
          the apportionment of industrial disabilities be added to the  
          Labor Code?
          

                                       PURPOSE
          
          To bar the consideration of race, national origin, gender, sex,  
          genetic predisposition, and certain other factors in the  
          determination of an apportionment of the causes of an industrial  
          disability.


                                      ANALYSIS
          
           Existing law  :

            Generally requires employers to secure the payment of  
             workers' compensation for injuries incurred by their  
             employees that arise out of, and in the course of,  
             employment.  Benefits to which an injured worker may be  
             entitled include permanent disability indemnity (payment for  
             loss) benefit payments for long-term permanent injuries.  The  
             amount and duration of such payments are determined by a  
             schedule in law that is in turn dependent upon a permanent  









             disability rating reached through an evaluation by a  
             physician of the injured worker's bodily impairment.  (The  
             impairment rating is converted into a disability rating  
             through a formula devised by regulation.) 

            Requires that a physician make an "apportionment  
             determination" with respect to the permanent disability.   
             That is, the physician must find (a) what approximate  
             percentage of the permanent disability is caused by the  
             direct result of the injury arising out of and in the course  
             of employment, and (b) what approximate percentage of the  
             permanent disability is caused by other factors both before  
             and subsequent to the industrial injury.  If the physician  
             determines that the disability is partially the result of  
             these "other factors" the (degree of) impairment rating must  
             be reduced by the relevant percentage, ultimately resulting  
             in a lower permanent disability rating and reduced permanent  
             disability indemnity payments.
           
             Provides that no person in the State of California shall, on  
             the basis of race, national origin, ethnic group  
             identification, religion, age, sex, sexual orientation,  
             color, or disability, be unlawfully denied full and equal  
             access to the benefits of, or be unlawfully subjected to  
             discrimination under, any program or activity that is  
             conducted, operated, or administered by the state or by any  
             state agency, is funded directly by the state, or receives  
             any financial assistance from the state.  [Government Code  
             11135]

           
          This Bill  provides that race, religious creed, color, national  
          origin, age, gender, marital status, sex, or genetic  
          predisposition shall not be considered a cause or other factor  
          of disability with regard to any workers' compensation  
          apportionment determination.  This language would, if the bill  
          is approved, be placed in the Labor Code.


                                      COMMENTS

          
          Hearing Date:  February 27, 2008                          SB 1115  
          Consultant: Rodger Dillon                                Page 2

          Senate Committee on Labor and Industrial Relations 
          








          1.  Need for this bill?

            A. What is going wrong with apportionments?
          
            Since the passage of SB899 in 2004, there have been increasing  
            reports that physicians, reading the law as requiring  
            apportionment in all workers' compensation cases, have been  
            apportioning disabilities on the basis of "risk factors" such  
            as age, race, sex, and genetic predisposition - rather than  
            basing the apportionment on actual documented and evaluated  
            evidence of pre-existing medical condition.  In a recent State  
            Court of Appeals case (Vaira v Workers Comp. Appeals Board),  
            for example, which was widely reported in the public media,  
            the court sent the case back to the Workers' Compensation  
            Appeals Board, stating that the physician who had done the  
            apportionment failed to base the apportionment on actual  
            medical evidence.  The physician based the apportionment to  
            the "other factors" on the grounds that the individual in the  
            case was an elderly woman at high risk of osteoporosis and  
            showing some evidence of the condition.  However, the  
            physician did not demonstrate, with substantial medical  
            evidence, the link between any actual condition and the  
            disability.  

            Dean Calbreath, in a February 17th article in the San Diego  
            Union Tribune, cited a number of similar instances of improper  
            apportionment procedures.  He highlight one case where a  
            medical examiner cut a man's workers' comp payments in half  
            because, as an African-American, he had a "genetic"  
            predisposition to high blood pressure or hypertension.  Other  
            examples Calbreath noted:

             ?    Last month, medical examiners at Kaiser Permanente in  
               San Diego cut down a food service worker's claims for  
               carpal tunnel syndrome because she had several pre-existing  
               conditions, including "being female." In the past several  
               years, medical examiners in other locales have cited  
               "female gender" as a reason for cutting carpal tunnel  
               claims, since women statistically report more problems than  
               men. 

             ?    Last September, a medical examiner in Los Angeles  
          Hearing Date:  February 27, 2008                          SB 1115  
          Consultant: Rodger Dillon                                Page 3

          Senate Committee on Labor and Industrial Relations 
          








               disallowed a third of a 52-year-old clerk's claims of  
               work-related stress on the grounds that her advanced age  
               made her susceptible to hypertension. 

             ?    Last March, a medical examiner in Torrance disallowed a  
               portion of a cleaning woman's claims that her work-related  
               back injury had resulted in depression. The examiner's  
               reasons for slimming down the claim included that she was a  
               woman from Central America. "She's from El Salvador and she  
               is, as the pronoun indicates, a woman," the examiner said  
               in a deposition. "She has a personality disorder, which  
               sadly might apply to all too many women. And I must say,  
               when it comes to Central America, it might apply to more  
               men than I would care to mention." 

             ?    A middle-aged Hispanic man who spent decades working for  
               a utility company injured his left shoulder and left leg on  
               the job. By the medical examiner's account, the worker was  
               involved in intense physical activity: "putting up (power)  
               lines, working underground, climbing up poles,  
               construction, maintenance of lines, kneeling, squatting."  
               But the examiner trimmed his claim, saying that his  
               injuries were also caused by his race, age and gender. "Age  
               plays a big role in what you determine the nonwork-related  
               factors are, even though he did work half of his life  
               there," the examiner said. "Some of these (factors) are  
               racially connected and some are gender connected."  "Is  
               part of his disability due to the fact that he's a man  
               versus a woman?" the worker's attorney asked. "Very likely,  
               yes." 

             B.   Why does the language in this bill need to be placed in  
               the Labor Code, given that very similar language is  
               currently in Government Code 11135?
          
               In the workers' compensation arena, which involves  
               thousands of persons and which is governed primarily by the  
               Labor Code, there seems to be substantial misunderstanding  
               of the proper, legal procedures for apportionment.  Placing  
               this language in the Labor Code will help to clarify the  
               law prohibiting discrimination and make the specified  
               language more evident to those who look to the Labor Code  
          Hearing Date:  February 27, 2008                          SB 1115  
          Consultant: Rodger Dillon                                Page 4

          Senate Committee on Labor and Industrial Relations 
          








               for guidance in making decisions relating to workers'  
               compensation.  In addition, this bill adds the term  
               "genetic predisposition" to the protected classes, a term  
               that is not in existing code.

             C.   Does this bill place new responsibilities on employers,  
               making them responsible for medical conditions (with  
               associated costs) for which they are not currently  
               responsible?
           
                  No.  This bill prohibits discrimination on the basis of  
               generalized "risk factors," which is almost certainly  
               currently illegal under G.C. 11135.  Apportionments  
               determined through an evaluation of the actual medical  
               evidence, establishing a clear, causal link between the  
               condition and the disability are, and will continue to be  
               appropriate and lawful.  
              
           2.  Proponent Arguments  :
            
            Supporters of this bill believe that since the apportionment  
            provisions were rewritten in 2004 (SB899) employers, carriers,  
            and physicians have been misinterpreting and misapplying the  
            new language to deny injured workers the civil rights  
            protections that all other persons enjoy.  Supporters argue  
            that an apportionment determination that is based on supposed  
            "risk factors" such as age, gender, or genetic predisposition,  
            rather than an evaluation of the medical evidence linking  
            actual medical conditions to a disability, is patently  
            inappropriate and unfair.  Such a formula results in  
            discriminatory practices, lowering disability ratings and  
            reducing benefits for particular individuals.  The proponents  
            state further that SB1115 would not increase employers'  
            liability but would instead simply clarify and conform the  
            Labor Code to Government Code sections that bar unfair  
            discrimination.

          3.  Opponent Arguments  :

            None received to date.


          Hearing Date:  February 27, 2008                          SB 1115  
          Consultant: Rodger Dillon                                Page 5

          Senate Committee on Labor and Industrial Relations 
          








                                       SUPPORT
          
          California Applicant Attorneys Association (CAAA) - sponsor
          American Federation of State, County, and Municipal Employees  
          (AFSCME)
          California Labor Federation, AFL-CIO
          California Society of Industrial Medicine and Surgery
          California Society of Physical Medicine and Rehabilitation
          California State Conference of the National Association for the  
          Advancement of Colored People
            (CSC-NAACP)
          Gray Panthers, California
          
                                     OPPOSITION
          
          None received


                                        * * *






















          Hearing Date:  February 27, 2008                          SB 1115  
          Consultant: Rodger Dillon                                Page 6

          Senate Committee on Labor and Industrial Relations