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The Commission on Health and Safety and Workers’ Compensation (CHSWC), which was established in 1994, examines the health and safety and workers’ compensation systems in California and makes recommendations to improve their operation. The 324 page 2019 Annual Report is now available on the CHSWC website.

Here are some highlights of the latest Report:

The California workers’ compensation system covers an estimated 16,775,000 employees working for over 1,019,255 employers in the state. These employees and employers generated a gross domestic product of $2,968,118,000,000 ($3.0 trillion) in 2018. A total of 682,160 occupational injuries and illnesses were reported for 2018, ranging from minor medical treatment cases to catastrophic injuries and deaths. The total paid cost to employers for workers’ compensation in 2018 was an estimated $23.5 billion.

The advisory pure premium rates approved January 1, 2019, are on average 41 percent below those as of January 1, 2015. The charged rate rose on average by 21 percent from the first period of 2012 to its peak in 2015 and then decreased by 33 percent from the first period of 2015 to the first period of 2019. According to the WCIRB this decrease is largely due to the significant savings from SB 863.

Another significant accomplishment was the development and implementation of a streamlined process for California employers who wish to become self-insured to accomplish this process in a “speed-of-business” manner. In 2011, the total time required to complete the private self-insured application process and be issued a certificate of authority to self-insure was nearly nine months. In 2012, this was shortened to four to six months, with additional reductions during 2013 to less than 30 days. In 2014, OSIP successfully worked with private employers and completed this process consistently in less than 14 days.

Research on the impact of the 2012 workers’ compensation reforms on earnings losses suggests that SB 863 is likely to meet its primary objective of restoring adequate wage replacement rates, although some inequities still exist in these rates across impairments.

Operators in the underground economy create an unfair advantage over their law-abiding competitors and cost the state an estimated $8.5 billion to $10 billion in uncollected tax revenues each year. CSHWC suggest continued research into ways to identify the underground economy and ensure compliance with workers’ compensation and health and safety laws.

In recent years, criminal indictments and prosecutions have highlighted the extent of medical provider fraud in the workers’ compensation system. Estimates of the cost of this fraud to participants in the workers’ compensation system are as high as $1 billion per year.