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4/1/2004

Calif. tackles comp costs

By Steve Lawrence
The Associated Press

SACRAMENTO, Calif. — Rosaura Navarro picked strawberries in the fields near Watsonville until she wrenched her back and leg while lifting the baskets of fruit four years ago.

Back injuries are notoriously hard to diagnose, and Navarro says doctors could not pinpoint the source of her pain. Nevertheless, the 30-year-old woman said she has been getting $110 a week in workers’ comp instead of the $420 she made picking crops.

Such benefits may be in jeopardy as California tries to overhaul the most costly workers’ compensation insurance system in America.

California’s 91-year-old system has been troubled for the better part of the past decade, but now, with premiums doubling and tripling, the economy stagnant and businesses threatening to leave the state, fixing it has become a priority for lawmakers and Gov. Arnold Schwarzenegger.

Schwarzenegger wants to require doctors to use “objective medical findings” to determine if an employee has a work-related injury. Injuries would have to be “reproducible, measurable or observable.” He also wants to require employees to show that a cumulative injury — one that develops over time — was substantially caused by work.

Unlike many states, California covers all industries and all workers, such as field hands like Navarro and employees of small businesses. California also makes it easier than many states to claim a work-related injury; among other things, it covers cumulative injuries and occupational diseases that other states do not.

Because of those factors and others, the total paid in workers’ comp premiums in California has gone from $6.4 billion in 1997 to an estimated $25 billion in 2003, according to the California Chamber of Commerce. And the average cost of dealing with workplace injuries has more than doubled, climbing from $2.68 per $100 of payroll in 2000 to $6.30 per $100 in 2003 — the highest rate in the nation.

Business groups portray the problem as less a matter of fraud and malingering on the part of workers and more a case of too much subjectivity in the way injuries are diagnosed and rated in severity.

Too often, said Chamber of Commerce lobbyist Charles Bacchi, two workers with essentially the same injury will receive wildly different benefits. One doctor might prescribe costly therapy, while another might give the worker a painkiller.

Bacchi said such “highly subjective” evaluations may lead to a worker getting “a permanent disability award for something that’s not necessarily warranted.”

The changes proposed by the governor could affect Navarro and the thousands of other workers with similar injuries that are not easily detected by an X-ray or other diagnostic tool.

Attorneys and doctors said the governor’s proposal would be particularly harmful to California’s 900,000 farmworkers, who frequently complain of back pain.