TOUGH REFORM PAYS OFF WORKERS' COMP CZAR DESERVES AWARD, NOT GRIEF.

Byline: Jill Stewart  Capitol Punishment

A journalist friend of mine recently attended a banquet for hundreds of private detective agencies, and was fascinated to hear them, one by one, introduce themselves. The fascinating part: Roughly one-quarter specialized in investigating Californians who claim to be injured on the job.

The fact that California's private-dick industry spends so much time probing claims of back strains, pain and other injuries is testament to the troubles afflicting the most milked, most disastrous workers' comp system in the United States.

Last year, Gov. Arnold Schwarzenegger signed sweeping reform, Senate Bill 899 by Republican State Sen. Charles Poochigian of Fresno, to cleanse a mess that, by all accounts, was prompting layoffs and ruining companies that could no longer afford their own workers.

SB 899 is a big success. Rates are plunging, insurance companies that fled corrupt California are back, and severely injured workers receive more money while the barely injured get less. How incredibly sensible.

The biggest winners, besides truly injured workers, are small businesses who drive the California economy. As we heard in legislative testimony, employers saw rates skyrocket 250 percent to 1000 percent - even if they had no injured workers. That's what happens when tens of thousands of cheaters, greedy doctors and greedy lawyers bleed the system dry.

Now, under the Poochigian-Schwarzenegger reforms, rates are expected to show a total drop of 26 percent by late this year.

So if a small factory saw rates double from $35,000 to $70,000 a month in 2003, that will be slashed by $18,200 a month in 2005. That's a lot of small factories that won't have to lay off non-cheating employees.

But as we saw on shameful display April 27, there's a fly in this ointment: Lawyers who got squeezed, and labor fat cats who don't give a rip if small businesses go bankrupt.

A few days ago, these anti-reformers tried to oust workers' comp czar Andrea Hoch. They failed, thanks to the grit of increasingly impressive Senate President Pro Tem Don Perata.

Before reform, medical costs per claim in California were 23 percent higher than in 12 other big states. By 2001, that meant $24,235 per claim. The Workers Compensation Research Institute found that once a worker stayed home beyond seven days, claims of ``permanent disability'' mysteriously soared to 50 percent. By contrast, in Wisconsin it was only 29 percent.

Now such claims are dropping fast. Hoch is strictly abiding by the Schwarzenegger-Poochigian reforms. The number of ``disputed claims'' plunged from 17,104, in April of 2003, to 10,878 by January of this year, according to Hoch's data.

That's 6,226 legal documents not filed, 6,226 employers who didn't hire a detective, and 6,226 attorneys whose wallets aren't fatter. Boohoo.

Seth Unger, aide to Poochigian, notes that ``getting a permanent disability rating from a court is the place where the attorneys really make their money.''

California had a ``no-fault system'' so truly injured workers didn't have to go to court, but lawyers turned it into a travesty. They dubbed themselves ``applicants' attorneys'' - implying a harmless nature. They won fat ``permanent disability'' ratings. Labor bosses loved it, seeing it as a job perk for workers. Statewide, findings of ``disability'' ranged wildly from doctor to doctor. Your $50 twisted knee was another man's retirement.

``California has the worst return-to-work rate in the nation,'' notes Schwarzenegger spokesman Vince Sollitto, ``mainly because they were in litigation, it was all being contested and it was highly litigious.'' Workers were urged to stay home and fight.

Now, as of Jan. 1, Californians who claim ``back injuries'' or ``stress,'' but are out golfing or moving furniture, are the losers. Because now, finally, we use objective American Medical Association guidelines to determine disability - just like 41 smarter states and the feds.

Before reform, lawyers and Big Labor made sure AMA guidelines were banned - actually banned - in determining disabilities in California. Good Lord. Notes Sollitto, ``Both the fakers and the people with significantly lesser injuries will see a reduction in awards. That's very unfortunate for attorneys.''

These past few days, the media often sided with Big Labor and the attorneys in their Hoch coverage. The media's long silence on ``permanent disability'' is how California got so corrupted in the first place, so you'll see wetlands in Death Valley before you see the media snap to it.

The anti-reformers want Arnold to undercut Hoch. Don't do it, Arnold.

Ignore Democrats who insist they never dreamed reform would be so strict (yeah, it's hard to do what 41 sensible states do). Ignore silly Assembly Speaker Fabian Nuez, who threatened to hold up the California budget, then relented. Ignore Art Pulaski, of the California Labor Federation, who accused Perata of selling out.

The alternate plan: Give Hoch, champion of the truly injured and of California's devastated small business community, an award for State Worker of the Month.

CAPTION(S):

2 photos

Photo:

(1 -- color) Workers' comp czar Andrea Hoch answers questions at her confirmation hearing in Sacramento on Wednesday.

(2 -- color) Angie Wei of the California Labor Federation fights back tears as she listens to injured workers' testimony at Andrea Hoch's confirmation hearing.

Steve Yeater/Associated Press