What is Workers' Comp?
Workers’ compensation insurance is a business requirement for employers in California that too often challenges the fiscal well-being of the businesses it is meant to protect. It is intended to eliminate costly litigation when a worker gets injured or ill on the job. Workers’ compensation covers wages and medical bills for the injured employee and, in return, the employee absolves the employer from liability for the injury. However, escalating medical costs, systemic abuse of the system, and a proliferation of claim-related litigation deliver a different reality. Employers are faced with rapidly escalating insurance premiums and associated system costs that threaten their ability to stay competitive, to create jobs and to provide for their employees. Subsequently, injured workers are facing an increasingly uphill battle to secure the very benefits that workers’ compensation is intended to provide.
Historically, legislative policies and regulations meant to address the shortcomings of the system have not successfully done so. Rising insurance costs for California’s employers and inadequate benefits for their injured employees remain critical hurdles to overcome. In 2012, California ranked as the third most costly workers’ compensation system in the nation with employers facing an average indemnity claim of $73,000. Gamesmanship – taking advantage of system loopholes for unscrupulous fiscal gain – by tangential interests continues to drain industry resources and undermine the capacity for the system to adequately compensate injured workers.
However, the outlook for workers’ compensation in California is not entirely negative. Significant legislative strides have been made, specifically with the recent passage of state legislation in 2012 (Senate Bill 863), to reduce employer costs, increase employee benefits and diminish fraud. The California Coalition on Workers’ Compensation (CCWC) played an influential role in shaping this legislation and continues to aggressively oversee the regulatory implementation of these policies. Our coalition is known for this type of hands-on, intelligent policy reform, and for upholding the true spirit underlying workers’ compensation – the rules governing workplace injuries must be equitable to both employer and employee. This is not the case today.
Today, businesses are expected to shoulder the financial burden of a broken healthcare system. Companies are being asked to look the other way as legal loopholes drive up California’s insurance premiums. Employers are being forced to juggle their commitment to advancing employee health and productivity and their need to reduce soaring workers’ compensation costs.
CCWC is dedicated to addressing these challenges by elevating the collective voice of its employer-members and supporting associations, by delivering better statewide understanding of workers’ compensation issues through industry-leading educational outreach and through an unwavering commitment to balanced solutions equitable to all stakeholders.