July 29, 2003
CA's worker's comp fiasco
The problem is that California seems to do everything it can to encourage workers to overuse the system. For instance, while the state caps the amount of money it pays for each visit to a chiropractor, it places no limits on the number of visits -- so that workers (and chiropractors) receive a blank check. Nationwide, the average number of visits to a chiropractor on a workers' comp claim is 14. In California, it's 34.
California is also ground zero for litigation. Golden State lawyers pocketed $226 million in 2002 for workers' comp cases. Litigation is now so prevalent that California employers and insurers must hire lawyers to deal with a full 29% of claims in which the employee lost a week of work.
California businesses have been pleading for help for years, but Governor Gray Davis and the state's Democratic legislature continue to see more political mileage in rewarding unions (which always demand bigger benefits) and plaintiffs lawyers than they do in keeping California's businesses solvent. Last year Mr. Davis ignored appeals for reform and signed a bill that increased weekly benefits to employees who miss work because of their injuries.