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Workers Comp Program At Bankrupt City of Stockton California


The Bankrupt City of Stockton California

The largest bankrupt city in the nation – Stockton, CA is self insured with CorVel as the Third Party Administrator (TPA).  Stockton’s Workers Comp program seems to still be a fully funded self insured program.

Picture Of Stockton California Place
Wikimedia – LPS.1

One of the Five Keys To Saving Workers Comp $$ was being implemented at the time of the bankruptcy filing.  Stockton had initiated a medical treatment provider network (MPN) to cut medical treatment costs.  The MPN was very likely part of the CorCare network.

Stockton’s Risk Services department requires that all employees initially treat with one of three medical clinics.  This is a very conservative cost-saving approach to reducing Workers Comp medical costs.  The MPN will also enable Stockton and CorVel to better administer their return to work program.

Man Bankrupt City Throwing Red Paper Plane

The one area of concern on Stockton’s Workers Comp program is the benefits integration program.  Workers Comp is meant to be a standalone program.  That is why 2/3 of an injured employee’s wage is paid to them TAX FREE.  Basically, the employee is being paid full wages as there is no tax on the Workers Comp benefits.

Stockton is now using the employee’s leave time to integrate with Workers Comp payments to make sure they are being paid FULL SALARY.   Actually, Stockton is paying their injured employees that are out of work approximately 125% of their pre-injury wage.   This overpayment will remove any of the built-in motivations to return to work.

Workers Comp laws, rules, benefits, etc. were put in place to make the injured employee be as whole as possible while recovering from their injuries.  Stockton needs every dime they can find right now as they are out of $$$.  The benefit integration program is a mistake that will cancel out any of the savings from the MPN they wisely put in place.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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