The last Ca budget report termed CA as stagnant.
To me Cost Co problem is a indicative of all CA. It amounts to work comp employees filling out a form and you the employer are wrong case settled and settlement starts. Why won't government employees not address that there is a very real problem in Workers Comp the best answer that I can come up with is they could get sued. Honesty lost in legal jargon. Cost Co is a very fair employer one of the best in CA.
Calif. Tackles Workers Comp System
Sunday September 7, 11:56 am ET
By Michael Kahn
SAN FRANCISCO (Reuters) - Even Costco can't afford California anymore.
Costco Wholesale Corp. (NasdaqNM:COST - News), the largest wholesale club operator in the United States, traces its bargain-hunting corporate beginnings in part to a high-volume, steep-discount warehouse opened in San Diego more than 25 years ago.
But now, Costco says it could cut jobs in the state where it got its start because of California's skyrocketing worker's compensation costs.
The total bill for workers compensation in California has soared to an estimated $29 billion in 2003 from $9 billion in 1995, prompting Costco and other businesses to consider moving operations out unless the troubled insurance system is fixed.
"For the first time in the history of our company we are considering whether we should take support facilities and put them in other states," Costco Chief Executive Jim Sinegal told Reuters.
Even though California lawmakers are on the brink of passing reforms, business leaders question whether they will go far enough to keep companies from moving jobs to other states.
The issue has emerged as a hot-button topic in the Oct. 7 vote on whether to recall Gov. Gray Davis and elect a successor as candidates debate what can be done to reduce the high jobless rate in the nation's most populous state.
"I see consensus on both sides of the aisle to reform but the question is how much it will be," said Charles Bacchi, a spokesman for the California Chamber of Commerce. "I'm not sure they are going to come up with the kind of massive reforms that will have real impact."
The 90-year-old state system, which provides benefits to injured workers, is in trouble due to rising medical costs and liberal rules governing the treatment of injuries. Employers pay premiums to insurers who in turn cover injured workers.
But few private insurers remain in the market and a quasi-public agency writes 60 percent of the policies, a situation that could leave taxpayers footing the bill if the system collapses.
"California has some of the most liberal rules in the nation in determining where an injury occurred, how severe it is and how much disability benefits a worker should get," Bacchi said.
A recent report from California's Bureau of State Audits said state officials shoulder much of the blame by having ignored repeated warnings from experts that the system was troubled.
It cited a study showing that injured workers in California have 49 percent more visits with physicians and twice as many chiropractor visits than those in other states.
Sen. Richard Alarcon, chairman of a joint legislative committee working to reform the system, said a key goal is to cut billions of dollars in costs and avoid a 12 percent premium hike set to take effect in January.
"This is the biggest problem right now facing the legislature," the Democrat said.
California officials and business leaders warn that a failure to take immediate action could drive more businesses out of the state, causing layoffs and putting at risk an economy that ranks as one of the largest in the world.
Already, a slack economy and the high cost of business in California have sparked some 300,000 layoffs in manufacturing since December 2000 when the slump began, according to the California Manufacturers and Technology Association.
Sinegal said while only one-third of his employees are in California, 70 percent of Costco's workers compensation costs are in the state.
This added expense forced the warehouse club operator in March to reserve an additional $26 million against earnings.
"We are not going to tolerate it anymore," Sinegal told a recent news conference on efforts to reform the system.
On Friday, Costco delivered 30 boxes containing 150,000 signatures to Davis and state legislators urging that the system be reformed.
It's not just big companies that are hurting. Officials, lawmakers and business leaders say the huge jump in premiums has caused many small business owners to curb spending, lay off employees and in some cases even close their doors.
California Insurance Commissioner John Garamendi cautioned that fixing such a huge problem will not happen overnight but said lawmakers need to aid employers struggling "to stay afloat under the weight of crushing premiums."
"It is absolutely essential this legislature passes a comprehensive reform of this system," Garamendi told a recent news conference. "This is a race to save California jobs and the California economy."
We do have great weather so I suppose we could all lie back, file for workers comp and enjoy the best CA has to offer. At least it is an excellent climate for jobless, homeless. |
