Looking Back At the Biggest Developments and Changes to California’s Workers Compensation System in 2018


We are more than two weeks into 2019, which means it’s just about time to review the most significant changes to California’s workers compensation system in 2018. The previous year brought quite a few changes and developments.

Our workers compensation attorney in Los Angeles, CA from Law Offices of Kropach & Kropach cannot stop praising some of the developments and changes to California’s workers comp system, while other developments are less impressive.

So what were the most significant and memorable changes to California’s workers compensation law in 2018? Let’s take a look back at the previous year in retrospect.

Plummeting workers comp insurance rates

With the costs of recovering from and treating workplace injuries constantly rising year by year, workers comp insurance rates continue to plummet for most employers in California.

The rates that an employer pays his or her injured employees depend on a wide range of factors, but the advisory workers compensation pure premium rate approved by the California Insurance Commissioner continues a declining pattern. In November 2018, the eighth advisory rate decrease since 2015 has been approved by the California Insurance Commissioner. The advisory rate was lowered to $1.63 per $100 of payroll effective Jan. 1, 2019.

The rising cost of administering the workers comp system

The cost of administering the workers comp system is extremely high compared to the benefits actually received by injured workers. Our Los Angeles workers compensation lawyer explains that in 2018, it cost a whopping $.53 to deliver $1 of benefits, which means injured workers were able to receive too little after brokers and other agencies and parties take their cut.

In fact, frictional costs are even larger than the cost of paid indemnity benefits in temporary disability and permanent disability workers comp payments, while total overhead expenses make up more than 40 percent of insurer costs in workers comp cases.

California court rulings on workers comp in 2018

Let’s also not forget that courts in California have ruled several landmark decisions that have reshaped the workers comp system for decades to come. In particular, we are talking about Dynamex Operations West v. Superior Court, in which California Supreme Court finally put an end to the long-running debate about who should be classified as an independent contractor and who should be classified as an employee. The court broadened the criteria for finding a worker to be an employee.

“But what does it have to do with workers comp?” you may be wondering. Before the ruling, California employers had taken advantage of the uncertainty about who can be classified as an employee and misclassified their employees as independent contractors in an attempt to avoid paying workers comp benefits in the event of a workplace injury.

California’s continued battle against workers comp fraud

“Another major problem surrounding the workers comp system in California has revolved around fraud and labor law violations on the part of medical providers and workers,” says our experienced workers compensation attorney in Los Angeles.” In 2018, California courts continued their efforts to expose workers comp provider fraud and punish those who managed to break the law and accumulate money in their pockets.

The Division of Workers Compensation (DWC) in California announced in June 2018 that more than 260 medical providers had been suspended from the workers comp system on suspicion or fact of premium fraud or other labor law violations.

As you can see, the year 2018 was quite eventful for California courts and the workers comp system. All of the above-mentioned changes and developments can affect your workers comp case, which is why it is highly advised that you consult with a Los Angeles workers compensation lawyer from the Law Offices of Kropach & Kropach to discuss your particular case. Get a free consultation today by calling at 818-609-7005.

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