Monday, December 8, 2014

The Word: Uncertainty


That was the "Word on the Industry" that WorkCompCentral editors decided what best describes California workers' compensation at present.

It was the theme of my opening presentation at the WorkCompCentral Comp Laude Awards and Gala Saturday at the Sheraton LAX Gateway hotel where I summarized this comprehensive "story behind the story."

About 350 people from the industry, or affected by the industry, attended to hear not only the Word, but to hear panelists Christine Baker, Mitch Seaman, Sean McNally, Robert Rassp, and Bill Zachry discuss and debate SB 863, its status and whether it was meeting expectations (James Butler unfortunately was unable to participate because of an untimely injury).

A 2012 Workers’ Compensation Research Institute study found that nearly 30% of injured workers in California hired an attorney. That's more than any other state except for Tennessee and Maryland, and those systems aren't even close in size or expense.

The California Workers' Compensation Institute found that permanent disability claims filed between 2005 and 2010 were more than twice as expensive when lawyers were involved. Average cash and medical payments for permanent disability claims increased to $61,092 with an attorney involved, compared to $24,874 without a lawyer.

Attorney participation in claims has been growing.

In 2003 the CWCI found that attorneys were involved in 76.2% of all permanent disability and 29.9% of all indemnity cases. In 2014 CWCI found attorneys were involved in 80.4% of PD cases and 38.3% of indemnity claims.
Attorney involvement greatly increases costs.
And it's not just about attorneys - when cases involve attorneys medical bills inflate, as does duration of disability thus inflating temporary disability indemnity numbers and time off work costs.

Though it's easy to blame attorneys for all that ills California's system (where gross fees for counsel on both sides of the fence totaled nearly $1.2 billion in 2013) this fact is simply a symptom and not a cause.

Most of the panel members defended SB 863, saying it needs time to work out, and that it was designed to remove uncertainty.

But Rassp said that SB 863's complexity is frustrating and confusing to injured workers, and drives them straight to attorneys.

With this latest reform effort, Rassp said, "what we're seeing is a sea-change in our law practices," and a lot of workers walking into our offices, "frustrated as hell."

He opined that workers hire an attorney for the simple reason that "someone said no."

Motivational speaker at the Gala, Dwight Johnson, after everyone wiped the tears from their eyes hearing his strong story about two separate industrial accidents end in two separate amputations of both legs, summarized it best in first person experience: the whirlwind of laws, regulations, people, and decisions on top of the fear of an insecure, precarious future, drives the California injured worker to seek counsel.

And it was a "no" that drove Johnson to an attorney - utilization review denied Johnson's request to outfit his bathroom with disability hardware so he could take a shower forcing him to travel to a community pool to utilize facilities there just to clean up every day.

"To be as diplomatic about it as I can," Rassp said, "the more laws and regulations that exist on a given subject, the less common sense applies."

Uncertainty - the law is unsettled, people don't know where to turn, nonsensical decisions are made, inappropriate communications occur...

Maybe 863 needs time. Maybe folks need to step back a bit and understand what it is they're being asked to do. Maybe people need to pay attention to what is actually happening.

In the end though, as Johnson concluded, "be gentle, be kind."

That mindset could go a long way towards softening uncertainty.

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