California legislative committees on Thursday and Friday passed bills that would reduce the time employers have to accept liability on some workers compensation claims and extend for another two years COVID-19 presumptions.

The Assembly Appropriations Committee on Thursday passed S.B. 1127, would reduce to 75 days from 90 days the time employers have to accept liability on claims for certain injuries that are presumed compensable.

The bill would also create a new penalty of up to $50,000 if the Workers’ Compensation Appeals Board concludes an employer unreasonably denied a claim for a presumptive injury. The measure would also allow firefighters and police officers to receive up to 240 weeks of temporary disability benefits for presumptive cancer claims, rather than the 104 compensable weeks of TD available to other injured workers.

Proponents say the bill will “revise unreasonable denial penalty provisions that were gutted during the brinksmanship reforms of 2004” and break down obstacles in the workers compensation system that were “artificially constructed in the hope that the injured worker will settle for less than their claim is worth,” according to a bill analysis.

The analysis says the bill will likely have a significant increase on the Division of Workers’ Compensation’s budget, but the extent is undeterminable. Judges would likely experience increased workloads to adjudicate penalty disputes, the analysis says. And it’s difficult to project penalty revenue because the DWC “is not aware of evidence of findings that unreasonable rejections of liability for claims are leading to an unreasonable delay of benefits.”

The California Workers’ Compensation Institute in July released an analysis of the measure that suggested it could lead to more denials and litigation on complex cases.

“Provisional denials due to the inability to obtain necessary medical records, complete the medical-legal process, and other issues, including lack of cooperation with the investigation, will trigger more litigation as well as significant increases in allocated and unallocated loss adjustment expenses related to the investigation period,” CWCI said.

CWCI also said some provisions in the bill are in direct conflict with another measure before lawmakers this year that would extend COVID-19 presumptions enacted in 2020.

Under A.B. 1751, which Senate Appropriations Committee passed on Thursday, employers would have 30 days to accept liability for COVID-19 claims filed by first responders, nurses and other health care workers, and 45 days to accept liability for claims by other workers.

That bill would also extend to Jan. 1, 2025, the sunset date for the COVID-19 provisions currently slated to expire at the end of this year.

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