BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
1213 (Cedillo)
Hearing Date: 5/27/2010 Amended: 3/25/2010
Consultant: Bob Franzoia Policy Vote: L&IR 4-2
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BILL SUMMARY: SB 1213 would require the Division of Workers'
Compensation within the Department of Industrial Relations to
provide a party to a claim with single sign-on portal, real time
electronic programmatic access, at no charge, to the party's
data contained within the Electronic Adjudication Management
System (EAMS).
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Fiscal Impact (in thousands)
Major Provisions 2010-11 2011-12 2012-13 Fund
Expanded online access Unknown, major costs initially, lesser
but General/
to workers' compensation still significant costs
ongoing; potentially Special*
claims information in the millions of dollars
* Workers' Compensation Administration Fund
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STAFF COMMENTS: SUSPENSE FILE.
The Division of Workers' Compensation monitors the
administration of workers' compensation claims and provides
administrative and judicial services to assist in resolving
disputes that arise in connection with claims for benefits. A
2001 RAND Corporation study identified a number of issues
related to the timeliness of the dispute resolution process one
of which was the overwhelming amount of paper associated with
cases.
Approximately 36 million pages of case related documents are
submitted to the division's district offices annually.
Currently, around 140,000 new applications are filed each year
at the district offices. The division's information service
center receives an average of 27,000 calls per month for
information and assistance regarding workers' compensation
claims.
EAMS is the division's Web based electronic case management
system that launched in August 2008. It replaced six different
legacy systems representing the division's multiple business
units. EAMS is being implemented in two stages with the second
stage intending to allow access to the electronic case file
through issuance of log-ons and passwords and provide extended
electronic filing hours. The division, in conjunction with
external users, has been pursuing an electronic filing mechanism
that meets external user needs and functions with existing EAMS
architecture.
In November 2008, the division received approval for EAMS
Special Project Report (SPR) 3 which includes language calling
for additional funding for the provision of greater external
user access. The SPR is considering adding 1,500 software
licenses over a two year period to provide full allowable access
to license users and electronic
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SB 1213 (Cedillo)
filing to address the more limited needs of large users like
insurance companies and medical providers and bulk lien filing
for medical providers.
Toward that end, the Office of the Chief Information Officer is
requiring the division to review six criteria before funding is
approved. The criteria are:
(1) Results of a stress/load test to determine the maximum
capacity of the current system.
(2) Findings of a study to determine how many external users
will need access (access for 1,000 users is proposed) and
estimate the number of concurrent users.
(3) Data on actual system usage.
(4) Discussion of licensing cost models with each of the major
EAMS software product vendors.
(5) The division's policy and plan for managing external access
for EAMS.
(6) Participation by external stakeholder representatives in the
analysis, planning and policy development.
While there is concern from some stakeholders regarding
accessibility to the system, there is concern from some
stakeholders regarding increased costs. Because the SPR is not
final, an estimate of costs is unavailable and will not be for
some time. Some preliminary information suggests project costs
could increase by several million dollars or more to provide
single sign on portals and electronic access on a programmatic
basis (for example, all files related to a claims downloaded at
one time) instead of on a file by file basis. It is possible
the SPR could also determine that expansion of EAMS and
providing single sign on portal, real time electronic
programmatic access is not cost effective. Therefore the cost
of this bill would be that of providing single sign on portal,
real time electronic programmatic access as this is not part of
EAMS currently and may not be after the SPR is implemented, if
it is.
Staff notes EAMS is funded from the Workers' Compensation
Administration Revolving Fund which receives revenue from a
surcharge on all employers. Therefore, it is unclear how the
"at no charge" provision would be applied as currently all
employers are paying for EAMS but not all employers would have
single sign-on portal, real time electronic programmatic access
nor would they utilize it. If DIR is unable to charge for this
access, the cost would be borne by all employers, which is the
current funding method, or it would become a General Fund cost.
This provision also would prohibit charging for single sign on
portal, real time electronic programmatic access. However, it
is possible that the cost of this function could be prohibitive
if only spread across a small population of interested users.