SENATE BILL REPORT

                   SB 6030

              As Reported By Senate Committee On:

                Commerce & Labor, March 4, 1997

Title:  An act relating to establishing a performance audit and operations review of the state workers' compensation system.

Brief Description:  Establishing a performance audit and operations review of the workers' compensation system.

Sponsors:  Senators Schow, Goings, Anderson, Haugen, Horn, Rasmussen, Long and Oke.

Brief History:

Committee Activity:  Commerce & Labor:  3/3/97, 3/4/97 [DPS, DNPS].

SENATE COMMITTEE ON COMMERCE & LABOR

Majority Report:  That Substitute Senate Bill No. 6030 be substituted therefor, and the substitute bill do pass.

  Signed by Senators Schow, Chair; Horn, Vice Chair; Anderson and Newhouse.

Minority Report:  Do not pass substitute.

  Signed by Senator Heavey.

Staff:  Jack Brummel (786-7428)

Background:  Performance audits can assist the Legislature in determining the impact of state programs and ensuring effective and efficient delivery of services.

Summary of Substitute Bill:  The Joint Legislative Audit and Review Committee must, in consultation with the Workers' Compensation Advisory Committee and a legislative advisory committee, contract for a performance audit of the Department of Labor and Industries.  The audit is to review the following elements of the state's workers' compensation system: 1) organizational structure, 2) management and practices, 3) taxation, 4) revenues, 5) types of services, 6) cooperation and continuity between programs, 7) effectiveness in meeting system goals, 8) customer satisfaction, 9) internal reviews, 10) coordination with other agencies, 11) effectiveness in providing sure and certain relief to injured workers, and 12) performance compared to other private and public systems.

The Joint Legislative Audit and Review Committee must report to the Legislature on its findings and recommendations.  The Department of Labor and Industries must cooperate with the committee in the audit.  The audit is funded from the medical aid fund.

Substitute Bill Compared to Original Bill:  The substitute bill specifies that the entity conducting the audit may not be affiliated with an insurance business and the advisory committees are to be involved in the design of the request for proposals from potential contractors.  The substitute requires the study of the department=s effectiveness in providing sure and certain relief to injured workers.

Appropriation:  None.

Fiscal Note:  Requested on February 28, 1997.

Effective Date:  Ninety days after adjournment of session in which bill is passed.

Testimony For:  This will allow an outside set of eyes to look at the operations of the department, show what is working and make recommendations on improvements to the benefit of workers and employers.  This is necessary to help the department move up a notch in performance.  The study may be broader than it needs to be.

Testimony Against:  None.

Testified:  Doug Connell, L&I (pro); Gary Smith, Independent Business Association; Clif Finch, AWB; Robby Stern, WA State Labor Council; Rick Slunaker, Associated General Contractors.