SB 626 which was introduced last year by state Senator Jim Beall would have rolled back some of the key workers’ compensation reforms contained in SB 863.

The California Chamber of Commerce characterized SB 626 as “A California Chamber of Commerce-opposed “job killer” bill that severely undercuts the workers’ compensation reform deal agreed to by labor unions and employers in 2012 and would result in dramatic cost increases to California employers.” The Chamber goes on to state that “SB 626 distorts the entire balance of the deal and would decimate provisions anticipated to deliver hundreds of millions of dollars of costs savings, which were promised to be redirected to injured workers in the form of higher benefits. Already, important cost-saving reforms under SB 863 have been placed in doubt as a result of litigation from system vendors. Additionally, full regulatory implementation has not been completed, creating uncertainty over whether the savings will materialize. Meanwhile, California employers continue to see their workers’ compensation costs increase, due to higher medical treatment costs and an increase in the rate of claims filed.”

Specifically, the bill would eliminate a cornerstone cost-saving provision contained in SB 863 – independent medical review (IMR). Under SB 626, IMR decisions would be fully appealable to the WCAB taking medical necessity decisions away from physicians and putting them back in the hands of judges. It would also result in treatment delays for injured workers. The projected savings associated with IMR are estimated at around $400 million. It would repeal a provision in SB 863 that eliminates impairment ratings for psychiatric add-ons in some, but not all, cases. Numerous data-driven analyses demonstrated applicant attorneys had abused this add-on to artificially inflate permanent disability ratings. It would repeal a provision in SB 863 that prohibits a chiropractor from being a primary treating physician once the maximum number of chiropractic treatments has been received. It also unnecessarily limits utilization review and Independent Medical Review by requiring that the reviewing physician hold the same license as the physician requesting treatment. Current law requires reviewers to be competent to evaluate the specific clinical issues involved in the medical treatment and utilize relevant, evidence-based medical treatment guidelines, which are not state-specific.

A Senate Labor and Industrial Relations Committee hearing on SB 626 was set for January 15, 2014. This hearing would have been the first step in obtaining passage this legislative year. However, Senator Beall removed the bill from the Committee agenda fearing that it would not obtain enough votes to successfully win Committee approval. Thus, at this point, it would seem the SB 626 may have suffered an early death in 2014.