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SELECTED INDICATORS IN WORKERS’ COMPENSATION:  A REPORT CARD FOR CALIFORNIANS

Division of Workers’ Compensation Lien Decisions

The DWC has been dealing with a large backlog of liens filed on WCAB cases.  Many of the liens have been for medical treatment and medical-legal reports. However, liens are also filed to obtain reimbursement for other expenses:

The Employment Development Department (EDD) files liens to recover disability insurance indemnity and unemployment benefits paid to industrially injured workers.

Attorneys have an implied lien during representation of an injured worker.  If an attorney is substituted out of a case and seeks a fee, the attorney has to file a lien.

District Attorneys file liens to recover spousal and/or child support ordered in marital dissolution proceedings of the injured worker.

A landlord or grocer will occasionally claim a lien for living expenses of the injured worker or his/her dependents.

Although relatively rare now, a private disability-insurance policy will occasionally file a lien on workers' compensation benefits on the theory that the proceeds from the benefits were used for living expenses of the injured worker.

Some defendants will file liens in lieu of petitions for contribution where they have paid or are paying medical treatment costs to which another carrier's injury allegedly contributed.  

Liens are sometimes used to document recoverable (non-medical) costs, e.g., photocopying of medical records, interpreters’ services and travel expenses.

Effective July 1, 2006, budget trailer bill language in AB 1806 repealed the lien filing fee in Labor Code Section 4903.05 and added Section 4903.6 to preclude the filing of frivolous liens at DWC district offices. Labor Code Section 4903.05, originally added by SB 228, had required that a filing fee of $100 be charged for each initial lien filed by a medical provider, excluding the Veterans Administration, the Medi-Cal program, or public hospitals.

The following chart shows a large growth in decisions regarding liens filed on WCAB cases and a concomitant expenditure of DWC staff resources on the resolution of those liens.  

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