BILL ANALYSIS SB 1115 Page 1 SENATE THIRD READING SB 1115 (Migden) As Introduced January 22, 2008 Majority vote SENATE VOTE :23-13 INSURANCE 7-3 ----------------------------------------------------------------- |Ayes:|Coto, Berg, Charles | | | | |Calderon, Carter De Leon, | | | | |Lieber, Para | | | | | | | | |-----+--------------------------+-----+--------------------------| |Nays:|Benoit, Duvall, Garrick | | | | | | | | | | | | | ----------------------------------------------------------------- SUMMARY : Prohibits discrimination on the basis of race, religious creed, color, national origin, age, gender, marital status, sex or genetic predisposition in the process of apportioning medical causation for purposes of determining an employer's liability for the permanent disability of an employee injured on the job. EXISTING LAW : 1)Provides for a comprehensive system of workers' compensation benefits for workers who are injured on the job, including payments to compensate an injured worker for the permanent disability caused by an on-the-job injury. 2)Establishes a formula that is used to determine the extent of permanent disability, which is expressed as a percentage, and compensates the injured worker based on the percentage to which he/she is permanently disabled. 3)Allows a permanent disability to be "apportioned" to the various causes of the disability so that an employer is only liable for the portion of the disability attributable to employment by that employer. 4)Requires a physician, when making a report on permanent SB 1115 Page 2 disability, to make an apportionment determination by providing an approximation of the percentage of the disability that is caused by the injury at work, and an approximation of the percentage of the disability that is caused by other factors, whether industrial or nonindustrial, and whether occurring before or after the workplace injury. FISCAL EFFECT : To the extent the bill results in higher permanent disability ratings, the state's costs would increase for the payment of higher permanent disability awards to state employees. COMMENTS : 1)Purpose : According to the author, physicians are making discriminatory generalizations, rather than examining actual medical conditions or facts, when they are carrying out the mandate that they assign percentages to the various causes of a permanent disability. Specifically, the author seeks to prevent physicians from using "risk factors" as opposed to actual medical conditions, when making these apportionment determinations. 2)Discrimination in apportionment : Proponents point to several examples of inappropriate discrimination in application of the apportionment laws. In an unpublished appellate decision (Vaira v. WCAB), the Court of Appeal returned a case to the Workers' Compensation Appeals Board (WCAB) because the record was insufficient to determine whether the physician had based his apportionment decision on medical facts that showed the older female claimant suffered from osteoporosis, or on the basis that the risk factor alone was sufficient to assign a percentage of the causation to osteoporosis. Among the cases reported in the media is a case of an African-American man who had his permanent disability rating cut in half because of the fact that African-American males have a higher incidence of high blood pressure, and thus there was a genetic predisposition to hypertension, aside from his workplace's contribution to hypertension. These scenarios, among numerous other potential fact patterns, are examples of unfair reductions in permanent disability ratings that the bill is designed to remedy. 3)Opposition : The opponents do not disagree that discrimination SB 1115 Page 3 based on risk factors associated with the bill's protected categories is wrong. They respond, however, by arguing that the law already provides protections, and the bill only serves to open a Pandora's Box of problems. Opponents argue that the Vaira case proves that the law is not in need of change. The Court essentially determined that it is improper to use risk factors, and sent the case back to the WCAB to make sure that medical facts supported the apportionment. With respect to unintended consequences, the opponents believe that the effect of the bill would be to prohibit apportionment even when there is an actual preexisting condition, if that condition is in some way connected to one of the protected categories. The opposition initially took an "oppose unless amended" position, hoping to craft language that defined the distinction between inappropriate use of risk factors and proper use of preexisting medical conditions. However, the employer community was unable to reach any agreement on amendments due to the consistent concerns expressed by their various counsel that changes in the apportionment statute would result in unintended consequences. Because they believe Vaira evidences how the Courts view the issue, and because that decision held that actual medical facts are required to support apportionment, they argue this bill is unnecessary. Analysis Prepared by : Mark Rakich / INS. / (916) 319-2086 FN: 0005587