Wednesday, March 13, 1996


The California Department of Corrections (CDC) has experienced a significant reduction in paid workers' compensation medical and Industrial Disability Leave (IDL) costs over the last three fiscal years.

"Our department appears to have the lowest paid workers' compensation costs as a percentage of payroll of any major law enforcement or 24-hour care department in the state system," said CDC Director James H. Gomez.

According to the preliminary data from the Department of Personnel Administration, Corrections has shown a significant reduction in annual paid IDL and workers' compensation medical costs over the last several fiscal years. During the same time, the department's payroll increased by nearly 31%.

Annual paid IDL costs have decreased over $2 million since fiscal year 1992-93, to just over $10.5 million in fiscal year 1994-95. IDL is the benefit paid to state employees during any temporary disability lasting up to two years from the date of injury.

Paid workers' compensation medical costs in fiscal year 1994-95 were just under $23.5 million, down over $1.5 million from fiscal year 1992-93 levels. CDC's paid workers' compensation costs as a percentage of payroll in fiscal year 1994-95 decreased to 3.8%, down from 5% in fiscal year 1992-93.

CDC has reduced its workers' compensation costs largely as a result of an aggressive claims management program initiated in 1991. At that time, the department established full-time Return to Work Coordinator positions at each institution to manage claims on site, working directly with disabled employees. The new people also have developed monitoring techniques to better manage older cases and bring them to closure sooner through a fast-track settlement process.

This approach was especially successful at the Correctional Training Facility (CTF) in Soledad. Over the last three fiscal years, the prison's annual paid costs dropped nearly $2 million and its annual IDL costs were cut nearly in half.

"Because of our efforts, employees are returning to work sooner, claims are being settled faster, and the hardship suffered by injured employees is minimized," said Gomez.

"This is a 'win-win' situation for both staff and management. We are able to take care of the needs of staff and reduce costs at the same time," said Gomez.

"Our success has been a team effort," Gomez contined. "We couldn't have done it without the dedicated efforts of the prison Return To Work Coordinators, by management's ongoing commitment to reduce costs, and by the active involvement of the State Compensation Insurance Fund."