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