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Posted on 09/01/2003 10:12:34 AM PDT by NormsRevenge
Edited on 04/12/2004 5:56:53 PM PDT by Jim Robinson. [history]
It didn't take long for the gubernatorial hopefuls to make their pilgrimage to Indian Country, hats in hand and money bags open.
Wealthy gambling tribes have eclipsed prison guards, insurance companies and utilities as the biggest campaign contributors to political campaigns in the state. As such, they command attention, respect and fear from those seeking office.
(Excerpt) Read more at sacbee.com ...
The health system that treats injured workers in California is teetering on the edge of financial collapse. That leaves the California Legislature little time for partisan posturing as it faces the challenge of enacting some reforms that cut costs without cutting necessary care.
Studies have identified about $1 billion worth of medical costs that can easily be trimmed from this $29 billion system. All that's needed is to apply some constraints that exist in the rest of the California's health care world. This should be the low-hanging fruit for the Legislature on this topic.
What is taking them so long? For every necessary reform in workers' compensation, there is a special interest -- the chiropractor, the hospital, the doctor, the doctors' outpatient enterprise and the drug companies. Remember that this is just the health care slice of this system.
There are also the lawyers, the vocational programs and the insurance companies. Oh, and the injured workers themselves. And employers suffering from skyrocketing premiums.
And legislators, remember them? Just eight years ago, it was costing California companies about a third of what it does now to care for injured workers -- even though the number of injuries is down since then. The current setup originally was supposed to be a no-fault system that would quickly get workers the care that they needed and compensate them fairly for any permanent loss in their wage-earning ability. The Legislature, however, ended up designing a system that provided some of the nation's lowest financial benefits to workers at some of the nation's highest costs.
How? Behold the difference between an injured California worker and a typical injured worker elsewhere in the nation (the data is from recent studies by the California State Auditor and California HealthCare Foundation):
Injured workers here make 50 percent more visits to doctors.
They make 105 percent more visits to chiropractors.
They make 39 percent more visits to physical therapists.
And the drug companies charge 40 percent to 45 percent more for the same medicines than they charge a typical California HMO. (That's for health care that doesn't involve a worker injury, a whole different system.)
Why? Because the workers' compensation system is doing precisely what its flawed design motivates -- profits for middle men more than appropriate care for patients.
This is one of the last bastions of fee-for-service medicine in California, a system that increases providers' profits the more that they treat their patients. The Legislature doesn't have to invent a solution here, but to simply enact some standard cost constraints used by other segments of health care for years, such as fee schedules and utilization review techniques. A state commission has estimated the savings at about $1 billion. While a billon bucks isn't exactly chump change, that still leaves $28 billion in costs to examine.
The other layers of this system are more challenging to reform, particularly the role of lawyers. They get in the middle of these cases far more often in California (particularly in Southern California) than elsewhere in the country. This is a telltale symptom that this system has has become excessively adversarial. But can the Legislature's Democrats, who control this agenda, contemplate meaningful reforms that red uce the role of the applicant attorneys, their longtime allies? Stay tuned.
Meanwhile, the system bleeds. Caught by a deadly combination -- cut-throat price competition on the premium side and ever-rising costs -- more than 20 workers' compensation insurance companies have gone out of business. The insurer of last resort (and the biggest, covering half of all employers), the State Compensation Insurance Fund, is running dangerously low on reserves and could raise premiums another 12 percent (on top of 19 percent in July) by January.
The price of inaction is beyond unacceptable. It's still not clear, unfortunately, how lawmakers will find a path that a majority of them can accept.
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