CITY PUSHES WORKERS' COMP REFORM.

Byline: Rick Orlov and Harrison Sheppard Staff Writers

Los Angeles officials pushed lawmakers Tuesday for changes in the laws governing workers' compensation, which is expected to cost the city more than $160 million next year.

Councilwoman Wendy Greuel and officials from the city's Personnel Department met with more than a dozen lawmakers over the past two days to push for changes - particularly one dealing with late penalties for overdue claims.

``If the city makes a late payment on an initial claim, there is a 10 percent penalty - not just on that payment but on all future payments,'' Greuel said. ``Cities and counties should pay on time, but it should be a more reasonable penalty relative to the impact the individual is experiencing.''

The penalty for late payments is relatively small in the overall picture of city costs for workers' compensation - totaling about $1 million this year, said Tom Coultas, assistant general manager of the city Personnel Department.

But, he said, it is emblematic of a system gone awry and an example of other changes the city is pushing to bring its costs under control.

Personnel Director Margaret Whelan said some costs cannot be contained.

``Eighty percent of our increased costs are due to higher medical bills,'' Whelan said. ``That's the same thing driving up private insurance costs. That's why we have to get a handle on other aspects of the program.''

Coultas said the city is seeking a series of changes in the state law that will benefit local government as well as private industry.

Among these are requiring dispute resolution of cases before they go to a workers' compensation appeals board, which would save an estimated $3 million a year, and a limit on the amount individuals can receive in benefits.

``We have had a case where someone received 170 percent of their pay,'' Coultas said. ``It's outrageous.''

In addition, the city would like to see limits on visits allowed to chiropractors or physical therapists to two a month as well as a ban on allowing attorneys to refer people for care to facilities where they have a financial interest.

If those measures were approved, Coultas estimated, the city could trim upward of $15 million a year from its workers' compensation costs.

Greuel said she was encouraged by the response she received from lawmakers.

``I think they realize that this is beyond politics,'' Greuel said. ``It is about creating and keeping jobs in the state. California has the worst workers' compensation laws and I think people recognize we have to do something about it.''

Gov. Arnold Schwarzenegger has made reform of the state workers' compensation program one of his priorities, threatening to take a measure to the November ballot if lawmakers fail to make significant changes by March 1.

Speaking Tuesday to the Sacramento Press Club, Schwarzenegger reiterated his desire to see the system reformed.

``We want to fix the problem,'' he said. ``But remember one thing - it's always important when we fix (a) problem like this that it is good for the job provider and also for the employee. It's very important.''

Staff Writer David M. Drucker contributed to this report.

Rick Orlov, [phone]

rick.orlov(at)dailynews.com