BILL ANALYSIS �
AB 1145
Page 1
ASSEMBLY THIRD READING
AB 1145 (Cedillo)
As Amended January 4, 2012
Majority vote
INSURANCE 9-1 APPROPRIATIONS 12-5
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|Ayes:|Solorio, Bradford, |Ayes:|Fuentes, Blumenfield, |
| |Charles Calderon, Carter, | |Bradford, Charles |
| |Feuer, Hayashi, Skinner, | |Calderon, Campos, |
| |Torres, Wieckowski | |Chesbro, Gatto, Hall, |
| | | |Hill, Ammiano, Mitchell, |
| | | |Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Hagman |Nays:|Harkey, Donnelly, |
| | | |Nielsen, Norby, Wagner |
| | | | |
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SUMMARY : Requires vouchers for supplemental job displacement
benefits under the workers' compensation system to be provided
to injured workers no later than 80 days after the first medical
report indicates that: 1) there will be some degree of
permanent partial disability; and, 2) the injured worker is
permanent and stationary. Specifically, this bill :
1)Provides that an employer is not liable for the supplemental
job displacement benefit if an offer of qualifying employment
is made no later than 60 days after the first report by a
treating physician, qualified medical evaluator, or an agreed
medical evaluator that indicates there will be partial
permanent disability and the injury is permanent and
stationary.
2)Requires the employer to provide the supplemental job
displacement voucher no later than 20 days after the time to
make a qualifying job offer has expired.
3)Specifies that the supplemental job displacement benefit shall
be in the form of a voucher worth $6,000 for qualified
expenses.
4)Expands the purposes for which the voucher may be used to
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include up to $1,000 for the purchase of computer equipment,
payment of occupational licensing, certification, or
examination fees, the purchase of necessary tools, and up to
$500 for miscellaneous expenses that would not require
documentation.
5)Specifies that the voucher shall be valid for two years.
6)Provides that an agreement to settle or release a claim for
the supplemental job displacement benefit is valid only if
approved by a workers' compensation judge.
7)Requires the Administrative Director of the Division of
Workers' Compensation to adopt regulations necessary to
implement the bill's provisions.
8)Specifies that the provisions of this bill shall apply to
injuries occurring on or after January 1, 2013.
EXISTING LAW :
1)Provides for a comprehensive system of workers' compensation
benefits to be paid to employees who are injured during or in
the course of employment, including a supplemental job
displacement benefit.
2)Provides that, under specified instances, when an injury
causes permanent partial disability and the injured employee
does not return to work for the employer within 60 days of the
termination of the temporary disability, the injured employee
shall be eligible for a supplemental job displacement benefit
in the form of a voucher for education-related retraining or
skill enhancement at state-approved or accredited schools, in
accordance with a schedule ranging from $4,000 when the
permanent partial disability is less than 15% to $10,000 when
the permanent partial disability is between 50% and 99%.
3)Provides that the employer is not liable for the supplemental
job displacement benefit if the employer offers qualifying
employment within 30 days of the termination of temporary
disability benefits, and the employee rejects the offer.
4)Specifies that the voucher may be used for tuition, fees,
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books, and other education or skill enhancement expenses. No
more than 10% of the voucher moneys may be used for vocational
or return to work counseling.
5)Defines "permanent and stationary" as the point where further
medical treatment will not improve the disabling effects of
the injury.
6)Requires the employer to provide the employee within 10 days
of the last payment of temporary disability the information
about these rights.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Minor net special fund/General Fund costs/savings. Under
current law, the amount of the vouchers range from $4,000 to
$10,000. This bill standardizes that amount to $6,000. To the
extent that injured workers receive more than they would under
the old system, costs for the vouchers would increase.
However, it is just as likely that injured workers will
receive less than they would have under the current system,
which would result in a savings.
2)Minor costs associated with drafting the required regulations.
COMMENTS : This bill is intended to assist partially permanently
disabled workers to obtain appropriate retraining to enable them
to return to work. There is a broad consensus that effective
return-to-work incentives are the best way to achieve lower
costs for employers and better long-term outcomes for employees.
The author points out that current law ties the amount of the
supplemental job displacement benefit to the percentage of
permanent disability awarded. He further points out that, in
most cases, a worker is eligible for the voucher long before he
or she receives a final permanent disability award, and this
process can take several years before the final award is made.
In the meantime, the worker has no ability to use the voucher
during any determination or dispute over the percentage of
permanent disability. The longer the delay, the smaller the
chance that an injured worker will successfully use the voucher
to help him or her return to work.
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Supporters point out that California has one of the worst
return-to-work rates in the country, and that improving access
to training programs for those workers who cannot return to
their prior jobs will enhance the chances for successful
outcomes.
Last year, AB 211 (Cedillo) contained the identical language as
contained in the January 4, 2012, version of this bill that is
currently before the Legislature. The Governor vetoed AB 211.
The veto message provides:
"This bill represents an effort to improve benefits for
workers by
providing vouchers for those who need additional training in
order to
return to employment after permanently disabling injuries. I
am,
however, reluctant to enact piecemeal changes to the Workers'
Compensation system in the absence of more comprehensive
reform that
addresses both the cost and benefits under the system."
In addition, SB 3 (Cedillo) of 2010 proposed substantially the
same provisions as AB 211. It
was held in the Senate Appropriations Committee. AB 1636
(Mendoza) of 2007 also addressed the supplemental job
displacement benefit, but proposed a different solution to the
problem. It was vetoed by the Governor.
Employers and insurers generally took either a "support if
amended" or a "working with the author" position on AB 211.
They recognize that current law simply does not work, and that
effective return to work incentives are a positive thing.
However, the bill was never amended after it left the Assembly
Insurance Committee. The unwillingness of the author of AB 211
to accept proposed amendments led insurers and employers to seek
a veto. Those amendments would have:
1)1Treated "old" claims where the injured worker has not yet had
temporary disability benefits terminated under the same rules
that the bill provides for new injuries that occur on or after
the effective date of the bill.
2)Harmonized how the benefit is delivered and what is provided
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so that "new" and "old" cases are treated the same.
3)Made conforming changes that addressed internal
inconsistencies within the bill.
Analysis Prepared by : Mark Rakich / INS. / (916) 319-2086
FN: 0003049