BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 1105
                                                                  Page  1

          Date of Hearing:   August 8, 2012

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                     SB 1105 (Lieu) - As Amended:  June 13, 2012 

          Policy Committee:                              InsuranceVote:13 
          - 0 

          Urgency:     No                   State Mandated Local Program: 
          No     Reimbursable:              

           SUMMARY  

          This bill places into statute the current practice of allowing 
          self-insured employee welfare benefits plans to file a lien for 
          the cost of living expense services provided to an injured 
          worker. 
          Specifically, this bill: 

          1)Provides that a self-insured employee welfare benefit plan may 
            file a living expense lien against an award of temporary 
            disability benefits in cases where the plan has paid the cost 
            of living expenses for the same days that the temporary 
            disability benefits are being awarded.

          2)Defines a self-insured employee welfare benefit plan as a 
            plan, fund, or program established or maintained by an 
            employer, employee organization, or both, where it provides 
            benefits other than through insurance for hospital, medical or 
            surgical expenses, or other benefits in the event of sickness, 
            accident, disability, death, or unemployment.

           FISCAL EFFECT  

          Costs associated with this legislation would be minor and 
          absorbable within existing Department of Industrial Relations 
          resources. 

           COMMENTS  

           1)Purpose  . This bill allows self-insured employee welfare 
            benefit plans to file a living expense lien that would allow 
            the plans to recoup their costs in cases where temporary 








                                                                  SB 1105
                                                                  Page  2

            disability benefits have been awarded covering living expenses 
            for days already paid by the self-insured plan. 

            Current law allows for liens against these temporary 
            disability indemnity benefits where certain entities, 
            including when benefits are paid by a group disability policy, 
            have paid loss-of-income benefits to the injured worker. The 
            author argues that the type of benefits provided by an 
            employee welfare benefit plan are the same as those provided 
            by other types of coverage, so these plans should have the 
            same standing to file a lien as others similarly situated.

           2)Support  .  The California Correctional Peace Officers 
            Association (CCPOA) argues that the bill would allow the CCPOA 
            Benefit Trust Fund, and other self-insured employee welfare 
            benefit plans, to recover, through a lien, amounts advanced to 
            its members for living expenses while their workers' 
            compensation case is being delayed for investigation or 
            pending resolution before the Workers' Compensation Appeals 
            Board.  CCPOA argues that, currently, the trust has to 
            initiate a civil case if the member does not comply with his 
            or her agreement and return the funds advanced by the trust 
            upon resolution of the case by the Board.  SB 1105 would allow 
            the trust to place a lien with the Board to directly recover 
            the money in an efficient manner.

           Analysis Prepared by  :    Julie Salley-Gray / APPR. / (916) 
          319-2081