New data from the California Workers’ Compensation Institute reveals a high level of attorney involvement in California’s “no-fault” workers’ compensation system and finds that between 2000 and 2008, attorneys were involved in nearly 44 percent of all lost-time claims and in more than 86 percent of claims involving permanent disabilities. The data also reveal that the level of attorney involvement varies significantly in different regions of the state, with some of the highest rates noted in the areas in and around the Los Angeles Basin.
The Institute reviewed data from 620,215 closed and resolved indemnity claims with accident year 2000 to 2008 dates of injury, which together accounted for more than $17 billion in claim payments, and found that 271,677 (43.8 percent) of those claims involved an applicant attorney, a defense attorney, or both. Total benefits paid on the attorney involvement claims costs averaged $55,593, which translates to $15.1 billion, or more than 88 percent of all benefits paid on the indemnity claims in the sample.
Statewide, 43.8 percent of closed indemnity claims involved an attorney. As in past studies, litigation was most prevalent in Southern California, where 48.8 percent of all lost-time cases involved an attorney, compared to 37.9 percent of similar cases in Northern California. Furthermore, since 2000, the Institute found that more than 52 percent of the closed and resolved indemnity claims in Los Angeles and Orange Counties involved attorneys, which was 8 percentage points above the statewide rate. The attorney involvement rate was also above the statewide level in Ventura/Santa Barbara/San Luis Obispo Counties, and in the Inland Empire, though it was slightly below the statewide rate in San Diego/Imperial Counties and the rest of Southern California. In contrast, the attorney involvement rates throughout most of Northern California were well below those in the south, and were also below the statewide rate. CWCI noted that the San Francisco Bay Area had among the lowest attorney involvement rates in the state, with attorneys used in just 36.5 percent of the indemnity claims in the Bay Area.
Limiting the analysis to just permanent disability claims, the Institute found attorneys were involved in 85.7 percent of PD claims statewide. Attorney involvement rates ranged from a low of 80.1 percent of the Bay Area PD claims to 89.3 percent of the PD claims in rural Butte/Sutter/Yuba Counties, which ranked just ahead of Los Angeles County, where attorneys were present in 88.6 percent of the PD cases.
The Institute has published more details and tables on attorney involvement in the California workers’ compensation system in a Bulletin, which is available to CWCI members and nonmember subscribers who log in to the Institute’s website at www.cwci.org.