Four Years After SB 899: The Insurance Industry 20 Year Plan on Workers’ Compensation in California

The Exclusive Remedy is best described as a compromise, an agreement if you will, to provide the appropriate and immediate medical care/treatment necessary to “cure or relieve”, even before the claim is processed. For this promise, injured workers have been stripped of their rights to bring suit within the civil court system. And, just who made this compromise; it certainly wasn’t the workforce of this state. It was employers, insurers, and your state officials that have brought this system to the sorry state it is in today.

The Exclusive Remedy has become exactly what insurers have wanted all along, a “post-injury” shield to protect them from prosecution for the widespread criminal acts, abuses and fraudulent practices employed to deny, delay, and/or terminate all claims, legitimate or not.

The 20-Year Plan

The goal of this “20-year plan” is simple; strip away the injured workers rights to any and all benefits! But, there are obstacles to every business plan and the ways to overcome these obstacles are not always clear, at first.

The 20-year plan is a euphemism for “How to Keep All the Money”. Insurance companies, over two plus decades, have been using a business plan designed to strip injury related cases from the jurisdiction of state and federal courts. Many years ago insurance companies started a process whereby they would invest millions in politicians, legislators, and the mainstream media, through political contributions and erroneous, misleading advertising.

Attorneys and lobbyists for the insurance industry have been very effective and, over time, have managed to make many subtle but significant changes to insurance laws and/or regulations, ultimately allowing insurers to write policies that afford them sole discretionary powers to investigate, interpret, and decide the validity of an injured workers claim. Simply put, to practice medicine without a license or fear of retribution.

Each phase of this 20-year plan has brought with it additional resources the insurer would employ to deny, delay, and eliminate claims, i.e. unscrupulous claim handlers, unethical insurance company doctors, and outside vendors that provide the industry with a wide array of services geared toward reducing or completely terminating all claims made by injured workers.

They’ve already started test-driving it right here in California. It started with “big insurance” flexing their legislative muscle and forcing the passage of Senate Bill 899 in 2004. If we don’t put a stop to it now, it’s going to spread like wildfire all over the other 49 states.

SB899 created the “Medical Provider Networks!” Now, when an injured worker goes to the doctor, the primary goal of the doctor is to get repeat business from the employer, not take care of the injuries of the injured worker in an expeditious and humane manner.

SB899 created “Utilization Review,” which is nothing but a ploy to delay and deny treatment on a wholesale scale. Claims examiners requesting UR send case after case to these independent physicians with little or no documentation, so the review is doomed to failure from the start!

SB899 removed any meaningful penalties that kept insurers in compliance with the law. Now it’s simply cheaper to pay the penalties than it is to comply with the law. And they don’t even get a slap on the hand for committing the most heinous of crimes. Where else can the gross negligence and wanton disregard of an insurer relating to the incompetent delay or denial of necessary life-saving medical treatment that leads to the death of an injured worker allow them to get off scot free with no fear of recrimination, financial liability or responsibility?

Now do you get the picture?

As with all business plans, the insurers have continued to fine-tune theirs. They have spent years figuring out how to bring together like-minded individuals with an ability to operate in unity; a blending of individuals from many “related” businesses. At the same time, this plan has had a drastic effect on legal representation for the injured worker.

They found the easiest step of all was taking advantage of greedy corporate executives and government leaders, believing [and proving] that with a lack of integrity comes a powerful negotiating tool MONEY. The more money spent, the more influence bought, yielding a net result of more POWER afforded to the insurance industry.

Insurance companies have been ever diligent in their efforts to bring this plan to fruition. They, step-by-step, have spent the last 20 years and billions of dollars bringing together like-minded individuals from the corporate world, select attorneys, and elected officials.

Insurance companies have their attorneys in waiting and pay them well to defend their bad faith activities. All the while applicants’ [injured worker] attorneys are being forced to reconsider taking on Workers’ Compensation cases because, through legislation, the insurance industry has managed to drastically reduce Permanent Disability Awards; the single source considered in paying applicant attorneys their pittance of a fee for representing their injured worker clients. The insurance industry won’t be happy until injured workers have totally lost their right to legal representation in a very legally complex system!

This group of corporate criminals was formed [and continues to grow] with a common philosophy, “above all else, focus on profit retention”. However, they knew to accomplish this they would have to exploit the American People, starting at the top.

Insurers educate subordinates ways to ignore the person and the injuries they suffer from and to focus solely on the industries profit driven directives, teaching them to make subtle [some not so subtle] influences within the claim process.

We all know and talk about the fraud committed by insurers on a regular basis; however, what represents fraud to us is merely “business as usual” to the insurance industry. Did you ever notice that except for the accusations from the insurance industry there is very little in the news about “Worker Fraud”? Why, simply because there is very little actual “insurance fraud” committed by injured workers. Another aspect of this 20-year plan is the amount of money insurers spend each year in advertising campaigns.

These ad campaigns are not sales oriented or directed not only to the public they are designed and used as propaganda to create the illusion of rampant worker fraud; with the sole purpose of misdirecting the attention of the our government leaders as well. As the old adage goes, “if you repeat a lie often enough, people will begin to believe it’s true,” and, for all intents and purposes it is insulting to the American people.

A prime example of the influences that the insurance industry has on our leaders is evident in the attempts by State Senate Pro Tem Don Perata’s efforts to pass his Permanent Disability increase bill, which has already been vetoed by Governor Schwarzenegger on two occasions. The governor has followed the line presented by an Insurer/Employer Coalition; as any “businessman to another” would do and has [twice] failed the workforce and the people of California.

This Insurer/Employer Coalition, led by the California Chamber of Commerce keeps mixing their words up and calls any effort to help the injured workers of California a “job killer.” It’s not killing any jobs! What they really mean is that it is a “profit killer”!

The Final Step

The final step of this 20-year plan brings to light the original obstacle they faced, an obstacle so large and difficult to overcome. This final obstacle has been the main focus of every step of this 20-year plan from its inception.

What has transpired over the past 20 years, the chipping away at our laws, the buying off of our elected politicians, and the networking with unscrupulous corporate executives has been what was necessary to finally take on the last and most important obstacle of all; an across the board, wholesale elimination of legal representation for the injured workers of California and the United States.

Applicants’ attorneys, are the last line of defense for the injured worker and the last obstacle for the insurance industry to overcome. The insurance industry has completed the prerequisites to get to this step and are now poised to attack. Once this occurs there will be no further obstacles to overcome and the insurance industry will have finally have succeeded to destroy this much needed system.

Ray Polly is a private investigator licensed by the California Department of Consumer Affairs - Bureau of Security and Investigative Services with 30 years of experience. He has over 60,000 hours of surveillance and investigative experience related to Worker’s Compensation, Liability (BI/PI), and undercover investigations in the areas of Employee Theft, Loss Prevention, and Workplace Drug Abuse. He has assisted the California Department of Insurance, the Department of Justice, and the California Highway Patrol in the criminal prosecution of insurance fraud by individuals, organized gangs, and legal and medical professionals. Polly was recently featured in a Call Kurtis news feature on KOVR CBS 13 in Sacramento. For further information about the California Insurer Fraud Task Force, visit their website.