But will the arguments be properly focused?
According to Neuhauser, in order for permanent disability indemnity levels to match pre reform levels an additional $2.64 billion will need to be found in the system.
Don't expect that to come from employers' premiums - Governor Brown gave no indication that he was inclined to promote any indemnity increases during California's tenuous recessionary recovery unless there was a wholesale revision of the work comp system that did not negatively impact the state's employers.
And even if permanent disability indemnity was increased to meet pre 2004 levels, is that a proper measurement of what this benefit is supposed to accomplish?
The California Constitution does not give us any clue as to whether permanent disability indemnity is to perform any specific function - the best the Constitution does is state that the overall workers' compensation system is to make "adequate provisions for the comfort, health and safety and general welfare of any and all workers and those dependent upon them for support to the extent of relieving from the consequences of any injury or death incurred or sustained by workers in the course of their employment".
The California Labor Code does not define permanent disability. It tells us how to determine how much there is, but not what it is or what it is supposed to "relieve".
Case law gives us a clue as to what permanent disability indemnity is presumed to provide - as summarized by Sullivan on Comp, Chapter 10:
"Case law has understood permanent disability as the 'irreversible residual of an injury.' It refers to the condition that remains after maximum recovery from the effects of the injury has been attained or the employee's condition becomes permanent and stationary.Permanent disability also has been defined as 'the impairment of earning capacity, impairment of the normal use of a body member or function or a competitive handicap in the open labor market.'"
Still, this case law does not give us any notion that one way of computing the adequacy of this benefit is any better or more accurate than any other method.
That job is up to the Legislature, and this legislature isn't interested in a political hot potato like permanent disability benefits, especially when increasing them to pre-reform levels would increase system costs by over 30%.
Perhaps what is most troubling about the findings of Neuhauser is that the gulf between injured workers who hire an attorney, and those who do not, is expansive - and that points to a system that does not make "adequate provision" for "any and all workers and those dependent upon them for support".
The average impairment rating for cases in which the injured worker did not hire an attorney decreased 40.1%, from an average rating of 22.2% under the 1997 rating schedule to 13.3% under the 2005 schedule. At the same time, average compensation in unrepresented cases decreased 51.7% to $12,246 from $25,363 under the new system, according to Neuhauser's study.
In cases where the claimant did have an attorney, impairment ratings dropped 28.4% on average, from 37% under the previous rating schedule to 26.5% under the current schedule. Compensation paid in represented cases decreased 37.2%, to an average of $30,804 from $49,080.
Regardless of the drop in indemnity, this study says that injured workers need representation in order to get maximum advantage of "adequate provision".
I've heard it stated in the past that one of the objectives of "reform" was to minimize attorney participation in order to reduce litigation costs in the system. It's true that immediately following SB 899 the ranks of attorneys representing injured workers (aka "applicant attorneys" in California) dropped precipitously. Figures from the Division of Workers' Compensation (DWC) in 2007 showed a 30% drop in the applicant attorney rolls.
But has this really resulted in a drop in litigation?
Overall litigation at the Workers' Compensation Appeals Board (WCAB) division offices is down if measured by the number of Applications for Adjudication of Claim forms filed with the WCAB and by quite a bit. We don't know if this is due to reform effects, the economy, or a combination of factors.
We do know that cases that do get into the WCAB system are taking longer than before to resolve - but again we don't know if this is because of the complexity of issues, litigation management issues, WCAB staffing level issues, carrier opposition, etc.
But clearly, attorney involvement is desired if the injured worker wishes to avail him or herself of all of the benefits allegedly available, but made difficult to access by "reform" and related regulations.
One of the stated purposes of the 2004 reform laws that instituted a new permanent disability rating system based on the AMA Guides 5th edition was to promote uniformity and predictability.
About the only thing that is really uniform and predictable is that if an injured worker does not have an attorney then that injured worker will get significantly less money as compensation.