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Proposal Would Allow State of CA to Fine Insurance Companies

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Aired 4/19/09

The Schwarzenegger administration is proposing new rules that would allow the state to fine insurance companies for improperly denying treatment to injured workers. KPBS Reporter Kenny Goldberg has the story.

Under state law, workers comp insurers are allowed to use independent doctors to review injured workers’ treatment plans. Many workers have complained they’ve been unfairly denied drugs and surgeries their physician ordered.

The proposed rules would fine companies $25,000 for using anyone other than a doctor to review medical files. Insurers argue it’s not fair to penalize them for simple mistakes. Workers comp attorney David Dugan says that’s not what the fines are about.

Dugan: We’re talking about imposition of penalties for willful failure to comply with their obligations under the law.

A recent study cited the medical review process for saving the workers comp system billions of dollars. But injured workers complain those savings have happened at their expense. Kenny Goldberg, KPBS News.

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