Lawyers Aren't the Problem; Everyone is the Problem

Monday, August 27, 2012 | 0

There is furious activity in Sacramento as the clock winds down towards deadlines to accomplish workers' compensation reform in the Golden State.

A new amended bill was reviewed by the Office of Legislative Counsel on Wednesday. While there is a possibility that it could be introduced on the Assembly floor today or next week, the contents of the proposed bill reportedly are constantly changing, and WorkCompCentral's sources say there is no guarantee at this time that a bill will even be introduced.

The Legislature adjourns on Aug. 31.

Even Sen. Ted Lieu, D-Torrance, whose Senate Bill 863 is the presumed bill that will carry reform, had not signed off on the proposal and hadn’t even agreed to allow his bill to be amended, his spokesman, Ray Sotero, told WorkCompCentral.

The amended proposal is almost half the pages as the one that was originally obtained by WorkCompCentral and there has been, in my opinion, significant changes that severely limit the savings originally projected, and severely limit the increase in benefits originally projected.

And I presume that since the ball is constantly moving that the projections are more amorphous than ever. But that's not what I'm here to opine about. My rant is about the lawyers...

There were many comments in LinkedIn that it's the lawyers that are at fault with California - presumably the applicant attorneys (those unfamiliar with California workers' compensation, attorneys representing injured workers are referred to as "applicant attorneys" because to litigate a claim one must submit an "Application for Adjudication of Claim"). Yeah - those pesky lawyers are all about the money and damn the system.

I recall reading or hearing somewhere that one of the goals of reform was to reduce the number of attorneys in the system. Presumably the way one does this is to reduce the ability to generate income from litigating a claim. Since California by statute pays attorneys out of the proceeds of a claim then reducing those proceeds should pinch the income potential of a claim, thereby reducing the ability to make money, ergo forcing applicant attorneys out of business.

Of course this is ludicrous thinking because many of the very good applicant attorneys I know are secure in their businesses and will do what it takes to maximize the position of their clients.

This should come as no surprise to anyone. The job of a lawyer is to zealously advocate for the client and in workers' compensation this means taking full advantage of any and all benefits available by law.

Getting rid of, or penalizing, the lawyers is tantamount to getting ride of the accountants at tax season. Unless your tax situation is very basic, my guess is that most of you reading this column retain the services of a tax preparer before every April 15.

Why do you do that? Seems to me that paying your taxes is simple and straight forward - calculate your income, pay the percentage dictated by code to the government.

Oh! Wait!! You mean there are DEDUCTIONS that you believe would improve your tax positions?! What about all of the frictional costs that tax preparers introduce to the simple task of paying taxes? Why not just eliminate accountants and enrolled agents and then reduce the tax bill by the amount of money everyone saves by not hiring these experts?

I get it - so what's good for the goose should not be good for the gander...

I know I will take flack from many for stating what I believe is the obvious - lawyers can not be eliminated from workers' compensation because benefits are money, and people fight about money. Claimants trust insurance companies about as much as you and I trust the Internal Revenue Service to look out for our better interests.

Add to that the emotional layer of not being able to generate an income, the confusion surrounding the actual process of a claim, the huge amount of paperwork with unintelligible words and terms of art, and you have a motivation for seeking legal counsel.

Want to get rid of attorneys in workers' compensation? Then just pay everything that is claimed.

Oh wait, we can't do that, critics would say, because there are people that will take advantage of that and will make claims that the payer doesn't deem reasonable or worthy.

That's called a DISPUTE: you want something and I don't want you to have it, whatever the reason.

California has about 350,000 disputes every year. When the economy was good and there was more full employment, it was closer to 500,000 disputes every year. Some of those disputes are frivolous. Some of those disputes lack merit. But many of those disputes are real, legitimate claims to benefits that the law provides for.

Tom Rowe, State Fund president and chief executive officer, on Wednesday said on the carrier’s blog that workers’ compensation is an agreement between employers and workers, and “this proposal [presumably the reform bill that has been circulating] clearly recognizes their voice and is a much needed shift back to the efficient system designed and implemented by our Legislature in 1914.”

Excuse me - this isn't 1914. We're 98 years past that. Lots of things have happened since 1914. Couple of world wars, space exploration, population growth, mutual funds and retirement accounts, the Internet ... I could go on. Thinking that a return to the "simple days" of the origination of work comp will resolve California's issues is naive.

Prior to 1914 guess what the problem was - those damned lawyers.

America got to where it is because the Rule of Law is respected and enforced. Yes, The Law is complicated and generally requires a bit of education to understand.

Want to get rid of the lawyers? Remove The Law and let society denigrate to anarchy, or worse, dictatorship.

In Russia women are imprisoned for "hooliganism" after engaging in what would be nothing more than expression of free speech in America. Guess who dictates the Rule of Law in Russia? Not the people...

Lawyers are not The Problem. No more than brokers who falsify quotes to steer business to preferred carriers. No more than doctors who unbundle procedures to maximize billings. No more than businesses who misclassify employees to reduce premiums. No more than government officials who engage in back room deals to further political agendas. No more than the carrier executive using corporate assets to enrich his personal lifestyle.

EVERYONE is the problem. Want reform? Deal with EVERYONE. This means dealing with BOTH the benefit delivery system AND the risk allocation system. Until then it's not reform; it's simply an adjustment.