BILL ANALYSIS �
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UNFINISHED BUSINESS
Bill No: SB 457
Author: Calderon (D)
Amended: 8/26/11
Vote: 21
SENATE LABOR & INDUST. REL. COMMITTEE : 4-0, 3/23/11
AYES: Lieu, Wyland, Padilla, Yee
NO VOTE RECORDED: DeSaulnier, Leno, Runner
SENATE APPROPRIATIONS COMMITTEE : 6-3, 5/26/11
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Emmerson, Runner
SENATE FLOOR : 25-14, 6/1/11
AYES: Alquist, Calderon, Corbett, De Le�n, DeSaulnier,
Evans, Hancock, Hernandez, Kehoe, Leno, Lieu, Liu,
Lowenthal, Negrete McLeod, Padilla, Pavley, Price, Rubio,
Simitian, Steinberg, Vargas, Wolk, Wright, Wyland, Yee
NOES: Anderson, Berryhill, Blakeslee, Cannella, Correa,
Dutton, Fuller, Gaines, Harman, Huff, La Malfa, Runner,
Strickland, Walters
NO VOTE RECORDED: Emmerson
ASSEMBLY FLOOR : 75-0, 9/1/11 - See last page for vote
SUBJECT : Workers compensation: liens
SOURCE : California Professional Firefighters
DIGEST : This bill requires the Workers Compensation
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Appeals Board to determine, on the basis of liens filed,
reimbursement for benefits paid or services provided by a
self-insured employee welfare benefit plan, notwithstanding
the Official Medical Fee Schedule, when an award is made
for reimbursement for self-procured medical costs for the
effects of an injury or illness arising out of and in the
course of employment. This bill states that its provisions
do not modify in any way the rights of any health care
provider to file and prosecute a lien.
Assembly Amendments (1) state the changes made by this bill
are not intended to modify particular rights of health care
providers, payors and other parties in specific factual
situations, and (2) narrow the bill's scope from health
care service plans, group disability policies, hospital
service contracts and self-insured employee welfare benefit
plans to applying only to self-insured employee welfare
benefit plans.
ANALYSIS : Existing law establishes a workers'
compensation system, administered by the Administrative
Director of the Division of Workers' Compensation, to
compensate an employee for injuries sustained in the course
of his/her employment. Existing law authorizes a medical
provider to file a lien claim with the Workers'
Compensation Appeals Board (WCAB) for certain expenses
incurred by the provider. Under existing law, the WCAB is
required to allow a lien to the extent of benefits paid or
services provided for reimbursement for self-procured
medical costs for the effects of an injury or illness
arising out of and in the course of employment.
Existing law requires the administrative director, after
public hearings, to adopt and revise periodically an
official medical fee schedule that establishes reasonable
maximum fees paid for medical services, other than
prescribed goods and services, in accordance with specified
requirements.
This bill requires the WCAB to determine, on the basis of
liens filed, reimbursement for benefits paid or services
provided by a self-insured employee welfare benefit plan,
notwithstanding the Official Medical Fee Schedule, when an
award is made for reimbursement for self-procured medical
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costs for the effects of an injury or illness arising out
of and in the course of employment. This bill states that
its provisions do not modify in any way the rights of any
health care provider to file and prosecute a lien.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Assembly Appropriations Committee, the
state's share of medical spending for workers compensation
is in excess of $200 million per year. If this legislation
results in a one or two percent increase in those costs, it
would cost the state somewhere between $2 million and $5
million per year (General Fund and Special Fund).
SUPPORT : (Verified 9/1/11)
California Professional Firefighters (source)
California Federation of Labor, AFL-CIO
ARGUMENTS IN SUPPORT : According to the bill's sponsor,
the California Professional Firefighters, if an employer or
its insurer denies a workers' compensation claim, case law
requires a non-industrial health program that is otherwise
available to the employee to provide coverage. The law
allows that health plan to file a lien to recover its costs
"to the extent of benefits paid" in the event the injury is
later determined to be work-related. However, the amount
the health plan may have paid in treatment may be greater
than the OMFS, and thus the health plan faces a loss of the
difference between what it paid, and what the OMFS covers.
The bill is intended to close this "loophole."
Proponents point to the scenario where there has been a
denial of the workers' compensation claim, and the denial
is overturned after being litigated, which may be resolved
in fairly short order, or may takes years to resolve, (as
in a case that resulted in over $1 million in treatment
costs for a firefighter who died of cancer) , and it is
clear that the Labor Code section being amended by the bill
applies only where there has been an adjudication of a
denied claim, and the adjudication results in a finding
that the claim was valid.
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ASSEMBLY FLOOR : 75-0, 9/1/11
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bradford, Brownley,
Buchanan, Butler, Charles Calderon, Campos, Carter,
Cedillo, Chesbro, Conway, Cook, Dickinson, Donnelly, Eng,
Feuer, Fletcher, Fong, Fuentes, Furutani, Beth Gaines,
Galgiani, Garrick, Gatto, Gordon, Grove, Hagman, Hall,
Harkey, Hayashi, Hill, Huber, Hueso, Huffman, Jeffries,
Jones, Knight, Lara, Logue, Bonnie Lowenthal, Ma,
Mansoor, Mendoza, Miller, Mitchell, Monning, Morrell,
Nestande, Nielsen, Norby, Olsen, Pan, Perea, V. Manuel
P�rez, Portantino, Silva, Skinner, Smyth, Solorio,
Swanson, Torres, Valadao, Wagner, Wieckowski, Williams,
Yamada, John A. P�rez
NO VOTE RECORDED: Bonilla, Davis, Gorell, Halderman, Roger
Hern�ndez
PQ:mw 9/1/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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