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Sunday, November 17, 2013

CEO resigns from California state workers’ comp insurer

California's workers' compensation program in beginning to unwind with the resignation of the CEO of the State Fund. Waves of reform have deciminated the system in recent years resulting in the mass delay and denial of claims. Today's post is shared from the .

Two top leaders resigned Friday from State Fund, a quasi-governmental agency that sells more than $1billion a year in workers’ compensation insurance, after overseeing a major restructuring of the organization’s bureaucracy.
Tom Rowe resigned as State Fund’s chief executive, and Dan Sevilla resigned as chief financial officer.
Fund spokeswoman Jennifer Vargen wouldn’t offer an explanation for their departures but said the resignations were voluntary.
The agency, formally known as the State Compensation Insurance Fund, isn’t well known but often plays a major role in California’s workers’ comp insurance market. It typically becomes the “insurer of last resort” when private carriers exit the state, as they did when costs soared and the market began imploding a decade ago. During that period, State Fund’s annual premiums zoomed from $1billion to $8billion, Vargen said.
After former Gov. Arnold Schwarzenegger signed a reform bill that reduced workers’ comp costs, the market turmoil subsided and private insurers moved back in. State Fund’s business began shrinking, and “we really had more staff than we needed,” Vargen said. Annual premiums have fallen back to around $1billion.
Since Rowe joined the organization in 2009, staffing has been reduced by 40percent, and some offices have been closed. The fund, based in San Francisco, employs 4,400 workers.
“The executive team has done an...
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