By Phil Walker

On March 11-12 in San Francisco, I am trying to do what many people have thought impossible: bring together the disparate players in the workers comp world to focus on a single objective: to start fixing a broken workers’ comp system in California.
 
People have asked me “Why now?  Why in this economy?”  Well, it is precisely because of this economy that we have to act now – and fast.
 
Let me give you a little history. In 2003, California was the most expensive state in the country for workers' compensation.  If you had a workers' compensation claim in California, you would receive a minimum of two to three times as much medical care for that injury as if you had the exact same injury anywhere else in the United States.
 
The premiums for our employers rose 139% a year every year from 2000 to 2003. As a result, employers began leaving the state in droves for Nevada, Arizona and offshore. Twenty-seven insurance companies went bankrupt or left the state in a four-year period, and more than 60% of all claims wound up with the California Insurance Guarantee or the State Compensation Insurance Fund.
 
A lot of people made a lot of money working this system… until Gov. Schwarzenegger signed into law the most sweeping reforms in California law in 70 years. The new law S.B. 899 did three things. It gave employers more control over medical treatment and medical costs. Secondly, it changed our apportionment rules to a new standard:  "The employer only pays for what it directly causes."  And thirdly, it enacted The American Medical Association Guides to the Evaluation of Permanent Impairment [5th Edition] as the law in California for measuring permanent impairment and, thereby, permanent disability.
 
With the signing of SB 899 into law, California became the 44th state to adopt The AMA Guides. This law reduced premiums by 56% and dropped us from No. 1 to No. 13 in the United States for the cost of workers' comp.  
 
However, in the past five years, this systemic improvement has become eroded by those who don’t understand or don’t respect how the system has been designed to work. Attorneys and physicians are manipulating the system through incorrect ratings or inappropriate medical treatment, and judges are refusing to apply the law as it was intended. As a result, rates are going up for employers and – once again – we face the possibility of employers leaving our state in droves… at the time we least can afford it. (I have even stronger personal feelings about this; you can read them here.)
 
There needs to be a reset to how workers comp works in California.  As a workers' comp lawyer, I have seen how the system should work… and learned how to make it work fairly and equitably for all concerned. Knowing how the system is supposed to work can lead us to saving $1.3 million per 100 cases in permanent disability, cutting apportionment by 35% and cutting medical costs by 40%.
 
But we have to work together – and quickly – to make that happen. The Making Workers' Comp Work conference is our first step.
 
In the coming few weeks, you’ll be seeing guest commentaries from several of the guest speakers at the conference. The speakers cover the gamut of the workers' comp world, from top employers like Virgin America and the U.S. Marine Corps to leading physicians, attorneys and claims representatives.  
 
Everyone attending is dedicated towards one purpose: making workers comp work in California. Our key deliverable from the conference will be a list of priorities that we – as a group – determine are necessary to fix the system… and we will be taking these priorities straight to Sacramento.
 
We’d like you to participate. There are five ways:
 
1.  Let us know your thoughts on the state of Worker's Comp in California.  Please go to http://www.makingworkerscompwork.com/blog and complete our issues survey. Your input will help fuel the discussion at the conference.
 
2.  Attend the conference. You can read about the conference and register at the website above.
 
3. Follow us on our conference blog, which will feature conference highlights.
 
4. Join the discussion on Twitter at @PhilWalkerLaw and mwcw10, on Facebook at http://bit.ly/cgKBVL or on LinkedIn at http://bit.ly/cgPEQ0.
 
5. And keep reading these guest columns in the next couple of weeks to see the full spectrum of issues we’ll be addressing.
 
 Phil Walker is the founder of Phil Neal Walker Law and http://AskPhilWalker.com.  He is the organizer of the Making Workers' Comp Work Conference, to be held March 11-12 in San Francisco.