FIRM HIRED BY CITY TO EXPEDITE CLAIMS TOO SLOW, AUDIT SAYS.

Byline: KERRY CAVANAUGH Staff Writer

The firm hired for $7 million to expedite workers' compensation claims for police and firefighters has demonstrated lax oversight and slow service -- the same problems that prompted the city to hire the company in the first place, an audit released Monday said.

The latest in a series of critical reports by City Controller Laura Chick said management and caseload problems may be costing taxpayers money and keeping injured personnel off the job longer than necessary.

In addition, she called for the city's Personnel Department to exercise sharper oversight of the contract with Cambridge Integrated Services Group Inc.

``What are we getting for $7 million a year?'' Chick asked at a City Hall news conference. ``What we're getting is uneven service. Claims are not being handled in a timely way. We are not pursing all of the ways to keep cost down. There is money to be saved.''

Chick also noted that some members of the Los Angeles Police or Fire departments have had to postpone surgery because of delays in processing their cases, preventing them from returning to their jobs.

The city expects to spend roughly $126 million this year on workers' compensation, which is about $10 million less than in 2004. Police, firefighters, park rangers and other sworn personnel make up 71 percent of the salary payments to injured city workers.

To lighten its caseload and improve service, the city hired a third party administrator in the 1990s. Cambridge has held the contract since 1999.

However, auditors found that in 2004 and 2005, Cambridge adjusters often handled more than the 150 claims that mark the industry standard, hurting the timeliness and quality of service for injured workers.

Auditors said the city's Personnel Department should frequently audit claims files to make sure employees are getting the care they need without overspending on the program.

The Personnel Department is now taking bids for a new third-party contract.

Personnel Department General Manager Margaret Whalen said she was pleased the audit found no situation in which an injured employee and had been denied care or appropriate payments. However, she said her department needs more money in order to reduce caseloads from an average of 211 to the standard 150 per analyst.

``We agree that industry practices are based on a staffing level of 150 claims per adjuster,'' Whalen said. ``And we have made requests in prior budgets to accomplish this. However, our requests have not been approved.''

kerry.cavanaugh(at)dailynews.com

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