These are valid areas that MUST be addressed by the legislature and Governor as TRULY INJURED WORKERS are facing a CRISIS that needs EMERGENCY LEGISLATION. One area of benefits that receives little attention, if any, is Vocational Rehabilitation Benefits. (VR).
... to be continued next week.
[Note: This is a continuation of Mr. Geller's rant from last week.]
The unequivocal statutory intent of SB899 is focused on returning the TRULY INJURED WORKER to gainful employment.
However, the recent reforms, prior to and including SB899, have resulted in drastic reductions in the area of Vocational Rehabilitation.
The erosion of this benefit began in 1994 when it was dramatically reduced and limited.
Prior to 1994 there was no specific limitation on the amount of money an insurance carrier had to spend to provide an injured worker retraining in the event that the injury sustained caused a permanent disability that prevented THE TRULY INJURED WORKER from returning to his, or her, usual and customary occupation. The purpose of VR was to help THE TRULY INJURED WORKER find a place in the workforce that accommodated the workers' disability.
In 1994, due to the ongoing "Crisis" of growing "Costs" and rising premiums, VR was put on the block. As a result, the benefit was slashed so that the maximum an insurance carrier had to spend on the entire benefit was $16,000.00.
As part of the recent reforms, Vocational Rehabilitation benefits have been further slashed.
Now an Injured Worker who can't return to his or her occupation is entitled to a "voucher" ranging in value from $4,000 to $10,000.00.
Workers who are between 0 and 15% PD are entitled to a maximum of $4,000.00 and those between 15% to 25% 6,000.00 and so on.
The new method for rating PD, along with the new concept of apportionment, has resulted in lower PD ratings and many TRULY INJURED WORKERS will be limited to the lowest amount though they are the most in need of the VR services.
Thus, without a change that changes the formula that compensates for loss of earning capacity, as well as the monetary chart, some TRULY INJURED WORKERS may receive fairer, (not necessarily fair), monetary compensation for lost earnings but may still loose the benefit of a TRULY BENEFICIAL vocational rehabilitation benefit.
Therefore, absent a change to the formula, our legislators and Governor should reduce the VR threshold by the ratio that the PD ratings have dropped.
Even if this suggestion were adopted the statutory intent of SB899 would not be met.
Under the old VR rules up to $4,500.00 of the $16,000.00 was allocated to pay for a Qualified Vocational Councilor that assisted THE TRULY INJURED WORKER in identifying an appropriate occupation as well as acting as a mediator between the insurance company and an Injured Worker whose disability prevented him or her from returning to the previous occupation.
Under the voucher system the Councilor can receive up to 10% ($1,000.00 max) of the voucher amount to assist the Injured Worker. Thus, the Injured Worker loses the benefit, to some degree, of the assistance of the experienced counselor. Without the guiding hand of the experienced counselor the likelihood of success of the Vocational Rehabilitation Program is very small.
Since much of the new reform's focus is on returning the Injured Worker to employment, the reduction of the VR benefit, including the guidance of a Qualified Counselor, is counterproductive to this primary goal of the reform package.
Moreover, it is counterproductive to society because we all agree that the best-case scenario occurs when THE TRULY INJURED WORKER returns to employment and once again enjoys the FREEDOM AND DIGNITY of being a productive member of society.
Therefore, when the legislature is considering the plight of THE TRULY INJURED WORKER, and their reinstatement of benefits, they should also modify the rules pertaining to Vocational Rehabilitation as this benefit is vital in assisting THE TRULY INJURED WORKER to re-enter the workforce.
Unfortunately, the unintended consequences of SB899 have hurt the TRULY INJURED WORKER'S ability to re-enter the workforce in yet another way.
For those THE TRULY INJURED WORKERS that are entitled to the VR benefit the voucher applies to payment for schooling and supplies, but does not provide THE TRULY INJURED WORKER with monthly income while attending school and looking for a job.
The problem, then, is how in the world is the TRULY INJURED WORKER going to go to school and look for a job without some income during that period.
Under the old reform reduction of VR the TRULY INJURED WORKER received a Vocational Rehabilitation Maintenance Allowance ( VRMA) of up to $246.00 per week to sustain him or her while in the retraining process. This allowance was allotted for in the $16,000.00 Cap.
Thus the previous reform that lowered the Vocational Rehabilitation benefit saved costs but, at the same time, preserved the Vocational Rehabilitation benefit in a manner that it was still effective in achieving the primary goal of returning the TRULY INJURED WORKER to the workforce.
If the TRULY INJURED WORKER has to participate in a vocational retraining program the old $16,000.00 cap and rules should be reinstated. That benefit was cut to shreds a long time ago and any further deterioration is not consistent with the legislative intent of SB899. At minimum, this exception should be permitted for THE TRULY INJURED WORKERS.
SB899 has had yet another unintended consequence that has hurt the TRULY INJURED WORKER.
SB899 has now limited Temporary Total Disability (TTD) to 2 years aggregate.
Unfortunately some injuries, especially those injuries sustained by THE TRULY INJURED WORKERS, take longer than two years to complete medical treatment. In the case of many TRULY INJURED WORKERS medical treatment and recovery require the worker to stay off work, by order of THE COMPANY DOCTOR, beyond the two-year period.
In these cases the TRULY INJURED WORKER would have no source of income and because of the injury could not seek gainful employment.
Fortunately, the State, in most cases, will pay the disabled worker a monthly income more or less equivalent to the TTD rate for an additional year. After that, the worker can apply for Social Security Disability and be paid by the Federal Government.
Unfortunately, there are cases when State Disability or Social Security Disability is disallowed or delayed. In many cases the TRULY INJURED WORKERS use up the additional year of State Disability payments and may not qualify for Social Security for a multitude of reasons.
In these cases, THE TRULY INJURED WORKER would have to apply for welfare. In cases where welfare has been declined, THE TRULY INJURED WORKERS literally live on the street and collect money at traffic lights if they are physically able to do so.
One of the major points of contention that led to SB899 was the charge that the employee-selected doctor unreasonably prolonged treatment and the need for Temporary Disability payments.
Under SB 899 THE TRULY INJURED WORKERS have to treat with THE COMPANY DOCTOR. Consequently, the veracity of the doctors' opinion is no longer an issue.
It seems reasonable that if the COMPANY DOCTOR is of the opinion that the TRULY INJURED WORKER must be off work longer than the 2-year period then the period should extend until the Doctor finds that the injured worker has reached maximum medical improvement and can return to work or enter into a meaningful Vocational Rehabilitation program.
Thus, the legislature and our Governor should extend the 2-year TTD limitation for THE TRULY INJURED WORKERS in the cases that the TRULY INJURED WORKER needs more time to complete his or her medical treatment.
Finally, it is unfair for the taxpayer to pay these benefits when the insurance company is earning a TRULY REASONABLE PROFIT. Considering the major budget deficit, it makes no sense to increase the burden on the State to create a huge windfall for the private insurance industry. Unfortunately, this windfall has landed on the already injured backs of THE TRULY INJURED WORKERS. (I can already here Mr. Sweet's apportionment argument).
Of course another primary goal of SB899 was to reduce costs so that insurance premiums could be reduced.
Though employers have complained that their reductions in premiums were not what they expected statistics supporting the success of SB899 in lowering costs shows that employers have already received, and will continue to receive, a substantial benefit from SB899. In addition, statistics support the fact that the Insurance Industry has been making record profits from the savings resulting from the implementation of SB899.
Fortunately SB899 was a financial success so soon. Now the insurance industry and the employers can afford to amend the admitted wrong done to THE TRULY INJURED WORKERS.
Application of Proposition 103 to the Workers Compensation insurance industry should also be passed to protect the profitability of the insurance industry and protect employers from excessive insurance costs while, at the same time, ensuring that no further harm comes to THE TRULY INJURED WORKERS.
Under Proposition 103 an insurer can raise premiums if they can show that they are not making a TRULY REASONABLE PROFIT. The decision to raise premiums is made by the non-partisan ELECTED insurance commissioner. This has worked very nicely in the area of Auto, Homeowners, Malpractice and every other line of insurance. The only line of insurance that is exempt from the provisions of Proposition 103 is Workers' Compensation, which incidentally, is the only line in which a CRISIS was reached since Prop 103 was implemented.
The voter approved implementation of Proposition 103 in 1988, has worked for all other areas of insurance. There is no reason why its application wouldn't work if applied to the Workers' Compensation line.
This would be a double win win situation. Insurance companies can earn REASONABLE PROFIT and our Governor can keep his promise that he would not hurt TRULY INJURED WORKERS. Employers can receive reduced insurance costs and the TRULY INJURED WORKERS would not have to go on welfare or the street. Finally, the taxpayer would not have to pick up a bill that is rightfully on the uninjured shoulders of THE TRULY PROFITABLE Workers' Compensation insurance industry.
Moreover, these modifications would satisfy the primary goal of SB899 by allowing more TRULY INJURED WORKERS to re-enter the workforce.
As Voltaire said, this would be "the best world of all possible worlds".
Though I could go on for pages, I just noticed a weed in my garden and I have to go and water it.
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- J. Geller
October 2006
