As California lawmakers consider for a second year reducing the time allowed for workers’ compensation claims handlers to investigate the compensability of occupational injury or disease claims, an analysis by the California Workers’ Compensation Institute shows how the changes could affect the acceptance of more complex claims.
SB 1127, introduced in February and still in committee, would reduce the investigation time for presumptive claims to 75 days. CWCI, in a paper released Wednesday, examined underlying issues related to proposed reductions in claim investigation timeframes and analyzed data from a large sample of non-COVID-19 and COVID-19 claims to evaluate the potential impact of the proposed changes . It found that “(efforts to reduce investigation deadlines…) would create compensation determination thresholds that are unnecessary for accepted claims and unrealistic for litigants and rejected claims.”;
Investigation periods are longer for legal and denied claims and require significantly more time to gather reports and documentation from outside sources. For example, at 75 days, only 49.2% of legal claims that were eventually denied have a compensation decision, “strongly suggesting that under current rules, 75 days is an insufficient time for adjusters to obtain the necessary medical and factual evidence .to make a decision on compensation, CWCI says.
WCRI found that determining compensation is “particularly challenging and time-consuming for COVID-19 claims, especially when those claims are being processed.” At the 45-day mark, 91.4% of accepted, non-litigated COVID-19 claims have a compensation decision, compared to 68.9% of accepted litigated COVID-19 claims, a difference of 22.5 percentage points. After 30 days, 85.5% of accepted non-disputed covid-19 claims have been decided, compared to 61.1% of legal covid-19 claims accepted, a difference of 24.4 percentage points.