...is moving in a more positive direction for contractors," says Thomas T. Holsman, executive vice president and CEO of the Associated General Contractors of California, West Sacramento.
A wide-ranging reform package enacted in April provides immediate medical care up to $10,000 and authorizes networks of employer-approved medical providers. Other key provisions include independent dispute review and capping temporary disability payments to two years.
Backers claim the reforms will save $5 billion to $7 billion annually and carriers are already offering lower quotes, says Holsman. "We believe it may be possible to continue to roll rates back," says Jay Hansen, legislative director for the State Building and Construction Trades Council of California. Another possible sign of hope: a 3.9% increase proposed by the state workers compensation bureau is considered comparatively small.
For every optimist, however, there is a skeptic reserving judgment. "The jurys still out as to what the real effect is going to be," contends Dennis M. Carney, partner at McSherry & Hudson, a Watsonville, Calif.-based insurance broker whose clients include contractors. He says Californias reform package, "has not appreciably affected" one critical issuethe availability of coverage. "There are no major carriers that have changed their stance" and decided to write policies in California as a result of the reforms, Carney says. Before the state can attract those insurance companies, "There has to be a feeling that the state fund is not in financial trouble," he adds.
The battle over claims payouts is being fought on many fronts. In Nevada, a contractor and a workers comp insurer tried to deny benefits to Keith Hurley, a worker who fell from a scaffold at a Las Vegas worksite. An expert witness hired by the insurer, Employers Insurance Company of Nevada, testified that Hurley could have been impaired by marijuana, traces of which were found in his blood following testing. But on Sept. 2nd, Nevada Supreme Court Justice Bill Maupin ruled that there was substantial evidence that the scaffold from which Hurley fell had moved, and that that was the cause of the accident.
Marijuana metabolite, the judge also ruled, is not a controlled substance. That is important because a Nevada law that says injuries can be presumed to be caused by drugs if an injured workers blood contains a controlled substance does not apply.