BILL ANALYSIS
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THIRD READING
Bill No: SB 1115
Author: Migden (D)
Amended: As introduced
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COM. : 3-2, 2/27/08
AYES: Migden, Kuehl, Padilla
NOES: Wyland, Ackerman
SUBJECT : Workers compensation: permanent disability
reports
SOURCE : California Applicant Attorneys Association
DIGEST : This bill adds to the Labor Code language
prohibiting various forms of discrimination in the
apportionment of industrial disabilities. The bill bars
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:
1.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
CONTINUED
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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.)
2.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.
3.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.
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
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What is going wrong with apportionments ? Since the passage
of SB 899 (Poochigian), Chapter 34, Statutes of 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 17 article in the San Diego
Union Tribune, cited a number of similar instances of
improper apportionment procedures. He highlighted one case
where a medical examiner cut a man's workers' compensation
payments in half because, as an African-American, he had a
"genetic" predisposition to high blood pressure or
hypertension. There are numerous additional examples.
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 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.
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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.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 3/3/08)
California Applicant Attorneys Association (source)
American Federation of State, County, and Municipal
Employees
California Labor Federation, AFL-CIO
California Professional Firefighters
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
Gray Panthers, California
Service Employees International Union
OPPOSITION : (Verified 3/3/08)
The following groups oppose unless amended:
Acclimation Insurance Management Services
Allied Managed Care
American Insurance Association
Association of California Insurance Companies
California Association of Joint Power Authorities
California Chamber of Commerce
California Coalition on Workers' Compensation
California Farm Bureau Federation
California Grocers Association
California Hospital Association
California Hotel and Lodging Association
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California Independent Grocers Association
California League of Food Processors
California Manufacturers and Technology Association
California Restaurant Association
League of California Cities
National Federation of Independent Business
Wine Institute
ARGUMENTS IN SUPPORT : Supporters of this bill believe
that since the apportionment provisions were rewritten in
SB 899 (Poochigian), Chapter 34, Statutes of 2004,
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 this bill will not increase employers'
liability but simply clarifies and conforms the Labor Code
to Government Code sections that bar unfair discrimination.
ARGUMENTS IN OPPOSITION : Opponents argue the bill
weakens the apportionment statute and allows judges to
overrule apportionment even when based on findings of
actual previous disability. They argue the bill should be
"amended to prohibit the use of risk factors to defeat
apportionment when an injured worker has a previous
disability that affects the degree of disability arising
from the workplace injury or illness."
Opponents argue that apportionment to pre-existing
disability is fundamentally an issue of fairness. "Just as
an injured worker deserves to be compensated for disability
arising from an industrial injury, an employer deserves to
be protected from paying increased compensation for
disability that does not arise from an industrial injury."
NC:do 3/4/08 Senate Floor Analyses
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SUPPORT/OPPOSITION: SEE ABOVE
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