Walters: Five years on, the pandemic still plagues California employee safety nets

When the COVID- pandemic struck California five years ago it massively impacted California families not only medically but economically As the state forced a great number of businesses to close their doors million Californians lost their jobs shooting the state s unemployment rate up to more than In turn two state programs that are supposed to cushion employees from the effects of workplace disruption were hard-hit The preponderance obvious impact is what happened to the state s unemployment insurance undertaking As workers were laid off they filed insists for weekly benefits from the Unemployment Insurance Fund which is financed by employers through payroll taxes However the fund which had been struggling to pay maintains prior to the pandemic was soon exhausted and the state borrowed about billion from the federal establishment to keep benefits flowing The Employment Growth Department also suffered a managerial implosion leading to not only the blockage of payments to legitimate claimants but billions of dollars in payments mostly out of federal funds going to fraudsters Five years later not only has the state been unable to claw back the billions in fraudulent payments but the state s unemployment fund s debt to the federal regime has continued to grow Interest charges are piling up and there s still a gap between income and outgo even though the state s unemployment rate in current times of is about a third of what it was in Related Articles Four California residents arrested in largest COVID- scheme ever feds say Why Americans access to lifesaving vaccines is threatened by RFK Jr overhaul FDA requires updated warning about rare heart hazard with COVID shots California woman sentenced to years in prison for million COVID- fraud scheme Razor blade throat As summer heats up COVID levels rise and specific record unpleasant symptom The Employment Improvement Department estimates that the debt will rise to billion by the end of even though federal representatives have raised their payroll taxes in California to chip away at the debt Underlying the issue is a decades-long political stalemate over unemployment insurance benefits and taxes The other safety net initiative affected by the pandemic is workers compensation which provides physiological restoration and backing payments to employees suffering job-related illnesses and injuries Most of employers purchase insurance either from private insurers or from the quasi-public State Compensation Insurance Fund to cover employee maintains A few big employers including state and local governments self-insure for work comp as it s dubbed An estimated work comp asserts were filed by COVID- casualties even though a connection between the condition and the workplace is tenuous at best Nevertheless those insists and sharp increases in therapeutic costs are being cited by the insurance industry s Workers Compensation Insurance Rating Bureau in seeking an increase in employer-paid insurance premiums tentatively approved by the state Department of Insurance to take effect on Sept It s the latest chapter in the long-running political friction over work comp costs and benefits which collectively approach billion a year Roughly once a decade the major players in the work comp system employers insurers unions work comp attorneys and healthcare care providers clash over the issue The last time was in when then-Gov Jerry Brown negotiated a compromise that raised benefits but imposed new rules on eligibility for benefits and anatomical care to save enough money to pay for the increases Although opposed by physiological providers and attorneys the deal had the desired impact including a sharp reduction in insurance costs vis- -vis payrolls However California s insurance costs of payroll remain among the highest in the nation according to a biennial survey by the Oregon Department of Consumer and Business Services widely considered the most of authoritative source of work comp premium information The stage would seem to be set for another of the Capitol s periodic work comp clashes However bill that would have increased cash benefits to disabled workers never made it through the first committee this year so the contending forces will face off sometime in the future Dan Walters is a CalMatters columnist