Assembly Standing Committee on Insurance

I can't imagine coming to work and not seeing you here, but we're very, very happy for you and what lies ahead in retirement. So if you change your mind, I'm sure you can always come back. But we just want to thank you for your service. We're very grateful. You're welcome. Today we will consider six bills. Two of these bills are on consent. The recommended consent bills are file item one, AB 1140, and file item six, AB 1578.

And once again, we're going to start it as a Subcommitee. So we do have an author. Assemblywoman Ortega, whenever you're ready to present AB 9117. Okay. This chair is really long. Good morning.

Good morning, members and chair. Thank you for the opportunity to present AB 917. Today, AB 917 would remove the sunset of the California Low-cost auto insurance program known as CLCA, making the program permanent. California law requires that all drivers of vehicles within the state maintain driver's insurance.

However, too many low-income drivers remain uninsured because of the high cost of standard insurance premiums. Instead of having uninsured drivers on the road, they can participate in the CLCA program, which provides them with liability insurance at an affordable price. The CLC program was established as a pilot program by the Legislature in 1999 and has proven to be effective tool for providing low-income drivers with auto insurance, many who previously had none.

Out of the nearly 200,000 California drivers, the CLCA has provided auto insurance to approximately 77% of participants that were insured at the time of their application. The effectiveness of CLCA has led to the program being continuously renewed for every five years. AB 9117 will remove the sunset date, making the low-cost auto insurance program permanent to ensure that California continues to provide needed auto insurance to low-income drivers. Today, testifying with me is Ms. Mellory Michael, deputy Legislative Director with the California Department of Insurance.

Good meeting. Oh, there we go. Can you hear? Okay. Good morning. Chair Calderon, Vice Chair Essayli, and Members of the Committee, Mellory Michael, Deputy Ledge Director here on behalf of Insurance Commissioner Ricardo Lara and the California Department of Insurance. As the bill's sponsor, Commissioner Lara would like to thank Assemblymember Ortega.

For her leadership in authoring this important measure, Commissioner Lara is sponsoring AB 917 because he believes the California Low cost auto program has proven to be a reliable resource for income eligible individuals needing auto insurance. The continuous need for this program to help ensure motorists have mandatory insurance coverage while driving in our state makes the sunset date unnecessary, especially during times of financial strain. I respectfully request your. I vote on this measure. Thank you. Do we have any witnesses in opposition?

Do we have any witnesses in opposition? Okay. Seeing none. Do we have any additional public comments? All right, we are operating as a Subcommitee, so at the appropriate time, we'll take this up for a vote. Would you like to close? zero, sorry.

I just had a quick question. So, I'd never heard about the program, but it sounds like a good program. Why is the participation so low? It says that there's only about 20,000 policyholders. We have like 20 million drivers. Why is there such low participation?

Yeah, that's a great question, and that's one that we're continuously looking into as well, and doing research and to see if we can gain an understanding as to why. I think when we had our focus groups, I think a big part of it is just program awareness. A lot of people just don't know about the program. So we're really taking a look into our outreach and to see what we could do to spread awareness of the program.

And I think also, too, is eligibility is 250% of the poverty level, so it's not like everyone could apply for this program. There are strict requirements in order to participate in the program. And I think that's also part of the barrier into why we don't see higher numbers. But I think largely it is the.

Awareness and why no sunset. I mean, I think it's always a good idea when the Legislature has sort of oversight on programs so we can see if we need to improve them, modify them, tweak them. Why get rid of it completely other than or maybe just put a longer sunset or something?

I think it's been proven to work. It gets renewed every five years, and I think making it permanent will increase the number of people that know about the program. We will be requiring a report so we can see, so there will be accountability. It's not like we're saying we're going to make it permanent and never look at it and make sure that it's being effective. We're actually going to require reports.

Okay. Thank you.

Any other questions from the Committee or comments? No. Okay. You may close. When? At the appropriate time. I would like to request an aye vote. Thank you. Thank you. Okay, we're going to establish a quorum. Committee secretary go ahead and call the role. Calderon? Present. Calderon, here. Essayli? Essayli, here. Berman? Cervantes? Chen? Chen, here. Vince Fong? Gibson?

Here.

Gibson. Here. Grayson, Joan Sawyer. Ortega. Here. Ortega. Here. Rodriguez Soria. Here. Soria. Here. Valencia Valencia. Here. Wood. Wood. Here. Okay, now we're going to take up the consent calendar. Do we have a motion?

So moved.

Thank you. Consent calendar. Calderon? Aye. Calderon, aye. Essayli? Aye. Essayli, aye. Berman? Cervantes? Chen? Chen, aye. Vince Fong? Gibson? Aye. Gibson, aye. Grayson? Jones Sawyer? Ortega? Ortega, aye. Rodriguez? Soria? Aye. Soria, aye. Valencia? Valencia, aye. Wood? Aye. Do we have a motion? File item number two, AB 917. Ortega.

Motion is due past two appropriations. Calderon? Aye. Calderon, aye. Essayli? Aye. Essayli, aye. Berman? Cervantes? Chen? Chen, aye. Vince Fong? Gibson? Aye. Gibson, aye. Grayson? Jones Sawyer? Ortega? Ortega, aye. Rodriguez? Soria? Aye. Soria, aye. Valencia? Valencia, aye. Wood? Aye. Okay, we'll keep the roll open for Members to add on.

Okay, are you ready to present AB 1213? Yes, thank you, madam. This microphone today, Madam Chair and Members, thank you for the opportunity to present today AB 1213. This is a narrowly tailored Bill that extends temporary disability coverage for a small number of injured workers who experience unjustified delays in medical treatment. California's employers provide medical treatment for work related injuries. In exchange, an injured employee is prohibited from suing their employer.

However, there is 104-week or two-year time limit on temporary disability payments, even in instances when the employee's medical treatment has been wrongfully denied and later authorized by either independent medical review, IMR, or the worker's Compensation Appeals Board. It is important to remember that all treatments that are recommended for an injured worker are prescribed by the employers or insurance owned doctors. Even then, the prescribed care is subjected to utilization review by another Doctor selected by the employer or the insurer.

If an employee has their medical care denied, their only recourse is to appeal the decision to an independent medical review, which is conducted by a third Doctor, again chosen by the employer. In 2021, there were over 200,000 treatment requests that were appealed to IMR. Of those requests, only 19,000 were overturned. Out of that 19,000, only 53 decisions were delivered too late for treatment to be given before the 104-week limit ran out.

While 53 is a small number, that's 53 families that couldn't make a car payment, couldn't make their mortgage payment, couldn't pay their utility bills, struggled to feed their families. These injured workers can lose their homes and their livelihoods due to a bad medical decision. That is why I'm here presenting AB 1213. Here testifying in support is former Assembly Member who is now representing the California Applicants Attorney Association, Alberto Torrico.

Thank you very much. Good morning, Madam Chair, Members of the Committee. Let me begin by thanking you, Madam Chair, and your staff, as well as the author and her staff on the work on this Bill. As was mentioned in the statement and in the analysis, the workers comp system, as all of you know, is a no fault system. So if a worker gets injured, their only recourse is the workers comp system.

Once they get injured and they get referred to a physician, 90% of those cases are referred to a medical provider network that's entirely controlled and designed by the employer or the insurance industry. 100% of those doctors are their doctors. 5.9% of those treating doctors prescribed treatment is denied. So less than 6% of those denials, 7.2% of those are overturned by the third set of doctors in the independent medical review process. None of these numbers are in dispute.

The only dispute is that the opposition is going to raise is the potential number of cases that make it this far and where the injuries will go beyond the two years. We think the number is very Low. As a matter of fact, we think it's probably within the margin of error of zero. It's going to be less than 5%.

However, after discussions with your Committee staff about these concerns, we took an amendment of several weeks ago to put a three year sunset on the Bill in order to assess and analyze. And at that point, it will no longer be a point of speculation. We'll know. So we did that as a showing of good faith, and we appreciate the Committee's consideration. Respectfully asked for that vote.

Thank you. Do we have any additional witnesses in support?

Thank you. Good morning, chair and Members. James Michael Powell with the American Federation of State County Municipal Employees asks me in support.

Okay, do we have witnesses in opposition? Please come forward.

Thank you, Madam Chair and Members, good morning. My name is Jason Schmelter. I'm here today with the California Coalition on Workers Compensation and PRISM, who collectively represent the interests of public agencies and private employers around the state. We appreciate the conversations that we've had with the author's office and her sponsor, and we understand that they're attempting to resolve a specific problem, and we're not trying to take away from that with our opposition.

But we do want to talk about that problem, which I think can be fairly summarized as delays in the medical treatment approval process that impact the availability of workers temporary disability. Okay, so first, I would remind the Committee that the utilization review process is heavily regulated and audited and takes five to 14 days. The sponsors of this Bill opposed today's current iteration of the UR and IMR dispute resolution process. I think that's fair to say, based on legislative history over the years.

And they did so when the status quo was frictional litigation that took nine to 12 months to resolve these same disputes, not five to 14 days. So, respectfully, the sponsors have misdiagnosed this problem previously, and I believe they're doing so again here. Secondly, the UR decisions to deny or modify medical treatment request based on the standards adopted by this Legislature and implemented and audited by the State of California are upheld at a rate of 92.8%.

And finally, let's talk about the IMR process, which is controlled by the injured worker, their attorney and or their provider, but it's certainly not controlled by us. State law allows 30 days after a UR denial for that process to be triggered, and then there's a potentially another 45 days for that process to complete. So that's 75 days, not five to 14. That process was triggered 264,000 times in 2021, and it failed at a rate of 92.8%. One process is short, objectively successful, and controlled by employers.

One process is long, helpful, but overused, and is not at all controlled by employers. So why do I make this comparison? Okay. It's because UR is an important and effective tool, and changing it as proposed by AB 1213, will incentivize more unnecessary IMR, which fails at a very high rate and takes five times as long as the UR process. And I believe my colleague from the chamber will go into more detail about why that's a problem.

Good morning, Madam Chair and Members. My name is Ashley Hoffman. On behalf of the California Chamber of Commerce, also respectfully in opposition, we share the concerns raised by Mr. Schmeltzer, but also want to discuss what we believe the consequences of this Bill will show. Our concern is that the impact will be an increase in unnecessary IMR requests that will cause actually more delays for injured workers, not fewer.

Applicant attorneys ostensibly trigger IMR because it's the only available due process for their client if they object to the UR decision. By that same logic, trying to expand eligibility for their client's TD benefits will create more of an incentive and obligation to trigger IMR, even if they are unsure of the need or the low probability of success. As stated, by Mr. Schmeltzer.

IMR, which is conducted by doctors chosen by a state system, already fails at a rate of 92.8% and causes substantial delays for the insured workers compared to the UR process. So our concern really is that AB 1213 creates an incentive for unnecessary IMR that will cause delays that negatively affect the worker and will flood the system with even more IMR requests. We agree with the author that there are some delays to injured workers that do deserve attention.

We just do not think this is the appropriate solution. Thank you. Thank you. Do we have any other public comments? Please come forward.

Good morning, Madam Chair. Chris McKaylee in respectful opposition on behalf of the Association Acclaimed Professionals. Mark segment with the American Property Casualty Insurance Association. Also in opposition, Latifah Alexander with the Association of California Healthcare Districts, respectfully, in opposition.

Good morning. Johnny Pena with the League of California Cities, in respectful opposition. Thanks. Good morning. Brian Cody with the California State Association of Counties and also on behalf of the California Special Districts Association, in opposition. Ben Ebbing, on behalf of the California League of Food Producers, in opposition.

Thank you. Let's bring it back to the Committee. Do we have any questions for Assemblywoman Ortega?

Thank you, Madam Chair. So I just have a couple of questions, and I appreciate the author identifying this. It seems like a lapse of coverage. I mean, if someone is getting temporary disability and they're being denied care to treat their disability and it's being deducted from their cap. So I have a couple of questions. Number one, the 104 week limit, is there a way to extend that? Currently under the current system, if there is a need to extend it, employers can, and some do.

It could also be subject to a carve out for a union. So there's various ways that it could. The employer does it at the front end or once they receive a request, I think it would be at the back end, just mechanically, because you wouldn't really have to make the decision until you hit the 104 weeks. And is it solely left to the employer's discretion outside of an MOU? It would be, yeah. Okay.

Or if there was some sort of dispute that led to a judge, but not typically. And I understand your argument that 90% of these appeals appear without merit. I don't want to say frivolous because I don't know the details without merit, but this Bill only captures the ones with merit. So I understand not wanting to set up an incentive system for everyone to challenge it and then extend it, but do you have any solutions to this particular issue that we could work on something?

Yeah, and I just want to highlight the issue isn't that it's necessarily just focused in the wrong area. We think that the solution will create more delay. That's why we're making the comparison. Right. Because it'll create an incentive for more IMR. I think one of the things we could do to cut delay is focus on reducing the number of unnecessary IMR requests. That's a potential for 75 days' worth of delay, not five to 14 and 92.8% of the time. In the last measurement, it failed.

I agree. I don't think we should characterize it as unnecessary or whatever. It's a due process, right. That's available to injured workers, but we think that this will cause them to trigger that due process more often and not more successfully, just more often. So, if the question and the focus of the Bill is delay, that impacts injured workers and their availability of temporary disability, we just think this is the wrong solution.

But we would be happy to talk to the applicant's attorneys and the author about other solutions. We just don't think this is it. Yeah, I do think she's identified an issue and I think you should work together. But let me ask the author, are you willing to work on cutting back on some of those claims? There's a lot of claims being filed which they're saying is extending the process and making it.

So are you willing to address maybe some disincentives or figure out a way to reduce the number of meritless claims?

I don't think there's any meritless claims here. We've narrowed it as much as we could. We're talking about, we think it's a very relatively small number, again, of families who are being impacted. I am willing to continue having this discussion with both the employers and the insurance industry when it comes to the IMR system, which ironically is an industry that it's a system that was created by the employers and the insurance industry, but currently it's the only system that workers have and that's where they go.

So I agree that workers you're targeting have merit. I guess what they're referring to is the 92% that are denied. Those are taking time to go through them and resolve them. So I guess the question is, are you willing to work on figuring out a way to reduce that number, the 90% of claims without merit?

So you don't have to have an answer today, but I just hope that you guys could maybe work on that and reach some sort of middle ground that will help the workers who have legitimate claims and are being denied treatment because that does happen, but also not incentivize attorneys, my colleagues, to flood the system with frivolous claims. So with that, I yield back. Thank you.

Thank you. Do we have any other questions or comments for the author from the Members? No. Okay. Seeing none. Okay. So, I appreciate the author and sponsors agreeing to put the sunset in this Bill, and I do hope that this addresses some of the concerns raised by you. Okay, secretary need a motion and second. Okay, thank you. File item number three. AB 1213. Ortega. Motion is do pass to appropriations. Calderon, aye. Calderon, aye.

Essayli, not voting. Berman? Cervantes? Chen? Chen, not voting. Vince Fong? Gibson? Aye. Gibson, aye. Grayson? Aye. Grayson, aye. Jones-Sawyer? Ortega? Aye. Ortega, aye. Rodriguez? Rodriguez, aye. Soria. Aye. Soria. aye. Valencia? Valencia, aye. Wood? Wood, aye. The Bill is out. Thank you. Thank you. Okay, Senator Rodriguez, whenever you're ready.

Not voting.

Thank you for allowing me to present AB 1278, which would improve the workers compensation system by clarifying process between providers, medical provider networks, and the division of workers compensation. Over the past 20 years, disruptions in medical treatment have occurred due to lack of statutory clarity regarding the process of these stakeholders. One such problem occurs when an injured worker receives an employed notification letter containing detailed information about their employer's affiliated MPN.

When an injured worker arrives at their initial medical appointment, they may not have this letter that the provider uses to identify the correct MPN. This bill will allow an injured worker to authorize the initial primary treating physician to request that an electronic copy of the employee notification letter be provided to the physician. Other disruption in medical treatment occurred when the DWC required NPNs to stop publicly listing contact information for scheduling and coordination treatment services that help injured workers quickly locate providers.

This bill to clarify that MPNs can publicly list these scheduling agencies to ensure patients can access care as quickly as possible. Unfortunately, the DWC has also denied MPNs and provider renewal applications solely for technical reasons. AB 1278 will give MPNs time to communicate with the DWC to fix any technical errors and clarity as long as someone is a licensed physician, a Doctor that can be part of an MPN to heal patients injured at the workplace. With me to provide testimony are Lisa Anne Bickford, Director of Government Affairs for Coventry MPN, and Charlie Camareno, Provider Network Manager for CorVel MPN Administrators. Thank you. Thank you.

Good morning, Madam Chair and Members. My name is Lisa Anne Bickford. I am the Director of Government Affairs for Coventry. We are part of the Enlyte family of companies, along with Mitchell and Genex. I'm also here representing the American Association of Payers, Administrators, and Networks, otherwise known as AAPAN.

I just wanted to give you a little background to sort of supplement what the Assemblyman had mentioned in his opening. And that's that this bill is really being driven for a need to ensure that injured workers have continued access to medical care. We have been administering, as well as Charlie, who you'll hear from in a moment, Medical Provider Networks in the workers compensation system since they began, which has been almost 20 years now.

We have never, until the last 12 to 18 months, had any issues administering the program until we started seeing some interesting interpretations, statutory interpretations, that have caused us and put us in a terrible position where we have had to take out providers from the medical provider network that have been serving California's injured workers for the entire 20 years. It's really put us in a bad spot.

We have the providers calling us and asking, why is it that we've been treating injured workers for 20 years and never had an issue? Why is it that we continue to treat folks in the commercial health system and in the Medicare system and the Medi-Cal system and we don't have an issue, yet we're having an issue treating injured workers now, all of a sudden, in the workers' compensation system. This has been particularly problematic for us in areas where we have limited coverage.

We really are concerned about losing those providers in areas that are rural areas and have very limited access to medical care. And the real reason behind this bill is to try and provide some statutory oversight and guidance to ensure that the MPN approval and re-approval process operates smoothly and that we can ensure access to care for the injured workers that have been participating and their providers that have been participating in the program for the past 20 years.

Good morning, Madam Chair, Members of the Assembly. My name is Charlie Camareno. I am the Provider Network Manager at CorVel Corporation. I'm also here testifying today on behalf of the American Association of Payers and Networks. Part of my job as a Provider Network Manager is to ensure that our injured workers who utilize and access our MPN have the ability to direct care without delay and without disruption. We have over 200 MPNs that are currently in use.

We have over 200 MPNs that are currently on file with the state. We represent a majority when it comes to the MPNs. In California, we have municipalities, several municipalities, including the County of Los Angeles, including the Orange County Fire Authority, including school districts, and including first responders. And so these are the people that are looking to us in order to direct care, not just for their employees, but also from a first responder point of view.

So we are focusing heavily on making sure that we have adequate coverage and adequate providers. Part of what has changed recently under the DWC has caused some disruption to care, has caused confusion in navigating our website, provider lookups, has removed some specialties that would call out specific treatment from an orthopedic standpoint for particular body parts, making it more difficult to vet the information and thereby causing delays to treatment, which is the exact opposite of what the intent of our Medical Provider Network is.

So we're asking for consideration to be given to the amendments that we have put forth under AB 1278 in order to help us partner with the state for smoother MPN application submissions and, also, smoother direction of treatment through the MPN. Thank you.

Thank you. Do we have any additional witnesses in support?

Good morning, Madam Chair and Members. Lori Kammerer, also with AAPAN, also here today on behalf of the National Association of Women Business Owners, NAWBO California, in support. Thank you.

Good morning, Madam Chair and Committee Members. My name is Tyler Gerlach, representing the California Asian Pacific Chamber of Commerce in support of the bill. Thank you.

Thank you. Do we have any witnesses in opposition?

Madam Chair, my name is Steve Cattolica. I represent the Independent Physical Therapists of California, the California Neurology Society, the California Physiatrists, as well as Language Access for Injured Workers. I realize there's no formal opposition, and if you would provide me an opportunity, I'd like to just go through a few things that are of concern to my clients and I think should be concerned to the Committee.

Go ahead.

First of all, there was a mention of scheduling entities. That's our main concern. The bill would, on the one hand, well, let's go back in time. This Committee passed AB 236, Assemblyman Holden's bill that was going to make better the directories for commercial healthcare. This bill will do the exact opposite. Entities will be able to make referrals without telling anybody who they're referring them to. The people won't be needed to be listed. My clients are victims of that process.

And, essentially, what it ends up is that the entities act as middlemen. They bill for the provider, they have contracts that are less than that, and they keep the spread. The opaqueness of the MPN system. There's no question that the MPN system is broken. We would love to work with the sponsors to make better the MPN program. The division is overwhelmed. They are not in a position to do the kind of oversight that they've been expected to do.

All of this is true, but we would like to be sure that this bill opens the door to more communication, not less. And notwithstanding the issue of getting timely referrals, make sure that those referrals are not based on the discount, which is illegal, and be able to, well, just be able.

Just to keep it short, to be able to make sure that the referral process and the way that the MPNs are distributed is a fair, and the ability for the injured workers to understand how it works is improved. So we are opposed to the bill. We realize that the bill is going to make it through this Committee. We'd love to work with the sponsors on an even better version. Thank you.

Thank you. And just a point of clarification. I believe Assemblyman Holden's bill that you referenced went to the Health Committee, not this Committee.

I apologize. 236? Okay. Yes, I apologize. But the point is that they go in opposite directions. And the fact of the matter is that they should be both going in the same direction, and that is to open it, not close it.

Understood. Thank you.

Thank you.

Morning, Madam Chair and Members of the Committee. Alberto Torrico on behalf of the California Applicant Attorneys Association, apologize for not submitting a letter earlier. I did speak with the author's staff yesterday. We do have some concerns with the bill. We share the concerns of the author and the sponsors about the DWC. I mean, we consider the DWC to be the equivalent of the DMV in the labor agency. We really do. If you look at these MPNs, they have doctors that are no longer practicing.

They have doctors that don't even take workers comp cases. We have a massive deficit when it comes to specialists, particularly oncologists. So there are some significant challenges. We're not sure that the approach in the bill is going to work, but we do look forward to working with the author and the sponsors to try, to try to expedite and streamline the process to make sure that workers get treatment on a timely basis. Thank you.

Thank you. I'll bring it back to the Committee. Any questions or comments for the author?

Thank you, Madam Chair. And I want to thank the author for addressing this really, really important issue, especially when it comes to public safety. This, in some cases, can become a matter of life and death. And what the obstacles that the injured have to go through or to just get the process going and how long it can be strung out can sometimes become so discouraging that they fall into an irreparable depression. And mental health now becomes a bigger issue than the ailment that first put them into that position. So with that, I'd like to be considered, if you would, to become a co-author. Thank you. Thank you.

Thank you. Anybody else? Okay, we have a motion in a second. Please call the roll.

File Item number four, AB 1278, Rodriguez. The motion is do pass to Appropriations. Calderon. Aye. Calderon, aye. Essayli. Essayli, aye. Berman. Aye. Berman, aye. Cervantes. Cervantes, aye. Chen. Chen, aye. Vince Fong. Gipson. Aye. Gipson, aye. Grayson. Grayson, aye. Jones-Sawyer. Jones-Sawyer, aye. Ortega. Ortega, aye. Rodriguez. Rodriguez, aye.

Aye. Rodriguez, aye. Soria. Aye. Valencia. Valencia, aye. Wood. Aye. Okay. Think it's out. Thank you. Okay. Thank you. Assemblyman Valencia, are you ready to present AB 1355? Thank you. First. I know. Move the Bill. Second.

Easy enough. Thank you. Good morning. Buenos dias, Madam Chair and Members, I'd like to start by thanking the chair and of course, the Committee team for diligently working on AB 1355, along with our team. And then also acknowledge our Chief of Staff, Aaron Ryberg, and then also our legislative aid, who have taken the lead on behalf of our office on this Bill.

Additionally, I'd like to highlight that our team has been actively working with the California Labor Federation, who was initially in opposition to the Bill to address their concerns. Because of those efforts, we are accepting amendments that add safeguards for employee consent and employee protections from retaliation. We also agree to include a five year sunset in the Bill so we can use that opportunity in the future to potentially have a broader discussion on what the future of employment forms and notices will look like in our state.

By accepting these amendments, it's my understanding the Labor Federation will be withdrawing their opposition position. AB 1355 allows employees to opt in to opt in to receive Earned Income Tax Credit statements and claim for benefit materials via electronic delivery. Employees may provide affirmative consent in writing or by electronic acknowledgment for opting into receiving these documents electronically. This Bill also contains, again, retaliation protection for the employee.

I want to emphasize that the employers would still have the ability to provide printed hard copies of these materials as long as the employee wishes to receive those in hard copy. The goal of this Bill is to provide flexibility for employees in the types of choices that they have with technological advancements. We also have the ability to share documents via electronic means, making these critical documents more readily accessible. Additionally, electronic distribution will significantly reduce paper waste.

According to the Employment Development Department, 2.2 million unemployment claims were filed in 2022, resulting in about 42 million UI paper documents being distributed. As of February 2020, 318 million residents also received the EITC paper documents. This equates to an estimated 65 million pieces of paper being printed and distributed in California over the past year for these two documents alone. Other notices related to flexible spending, loan forgiveness programs I nine employment eligibility verifications, pregnancy disability leave, and Covid-19 supplemental sick leave forms already allow for electronic delivery.

So this isn't something that's earth shattering or unprecedented. So this is just a continuation of that with me. I have to provide testimony. Ms. Leean Kravitz, the Vice President of public affairs at Fidelity Investments, and then Ashley Hoffman with the labor and employment policy advocate at the Cal Chamber.

Thank you, chair Calderon, Members of the Committee, the Assembly Member did a wonderful job explaining the Bill, so I will not belabor the point, but we are proud to sponsor AB 1355. This is a straightforward Bill that will help California employees and employers to be more environmentally conscious by providing for the electronic delivery of these two state required notices. As mentioned again, I just want to reiterate that this is not a mandate on either the employee or the employer.

The Bill will simply provide a more sustainable option if the employee opts in to the electronic delivery of these materials, keeping the choice in the hands of the employees. So thank you for your time today. I respectfully ask for your I vote, and I'm happy to answer any questions. Good morning, Madam Chair and Committee Members. Ashley Hoffman on behalf of the California Chamber of Commerce in support.

One of the primary functions of the Cal Chamber as a state Chamber of Commerce is advising our 14,000 Members on labor laws and how to comply, including required notices and postings. There are a significant number of required notices and postings both federally and under California law. And while some of those laws, as mentioned by the author, including pregnancy disability leave and the prior Covid-19 paid sick leave, allow for electronic delivery. Many do not.

And so, especially during Covid-19 remote workforce times, we saw a lot of interest in providing more electronic notice. So we think AB 1355 is a really common sense approach that's good for workers, employers and the environment. As mentioned previously, if the employee still wants to receive paper copies, they absolutely can. There is no mandate that they receive an electronic copy. I do know there was some concern raised that this may codify a Dir opinion letter related to electronic dissemination of wage statements.

But in our opinion, that letter was very specific to labor code 226 was dealt with wage statements, and this Bill would not impact that at all. So for those reasons, we urge an I vote. Thank you.

Aye.

Do we have any additional support in the room?

Ben Ebink, on behalf of the National Payroll Reporting Consortium and the California League of Food Producers, both in support. Thank you, Madam Chair. Chris McKaylee, on behalf of the Association of Claims Professionals in support of the Bill and thank you for your earlier acknowledgement of Sergeant Reed.

Mr. Chair Member. Sarah Flocks, California Labor Federation. I just wanted to thank the author and his staff and the Committee and their staff for working so hard with us on amendments, and with the amendments, we remove our opposition and are neutral. Thanks so much.

Madam Chair Members. Paul Gladfeldy, on behalf of travelers, we also support.

Thank you. Is there any opposition to the Bill? Do you have any witnesses in opposition? Seeing none. Any public comment? Okay, let's bring it back to the Committee. Any questions for the author? Someone Ortega. Not a question. Just want to thank the author for working with the opposition and getting to today's hearing and looking forward to working with you on future bills. Thank you. Mr. Gibson.

I want to thank the author, and I would like to be considered a co author of the Bill. Happy to have you. Thank you. Thank you.

I want to thank the author for being thoughtful and working with the opposition and with the amendments reflected in analysis, I'll be supporting the Bill today, so you can close whenever you want to.

Thank you. Just to recap, once again, thank you to the sponsor, the Cal Chamber, and then, of course, the California Labor Federation for their collaboration on this Bill. And with that, I respectfully ask for an aye vote. Gracias.

Hey, secretary, call the roll file item number five. AB 1355 Valencia. The motion is do pass as amended to appropriations. Calderon? Aye. Calderon, aye. Essayli?

Aye. Essayli, aye. Berman? Berman, aye. Cervantes? Cervantes, aye. Chen? Chen, aye. Vince Fong? Vince Fong, aye. Gibson? Aye. Gibson, aye. Grayson? Grayson, aye. Jones-Sawyer? Jones-Sawyer, aye. Ortega? Ortega, aye. Rodriguez? Rodriguez, aye. Soria? Aye. Soria, aye. Valencia? Yes. Valencia, aye. Wood? Yes. Wood, yes. Okay, the Bill gets out.

Thank you.

You're welcome. Now we're going to add on Secretary.

Consent calendar. Berman? Aye. Berman, aye. Cervantes? Cervantes, aye. Vince Fong? Vince Fong, aye. Grayson? Grayson, aye. Jones-Sawyer? Jones-Sawyer, aye. Rodriguez? Rodriguez, aye. File item number two. AB 917 Berman? Aye. Berman, aye. Cervantes? Cervantes, aye. Vince Fong? Vince Fong, aye. Grayson? Grayson, aye. Jones-Sawyer? Jones-Sawyer, aye. Rodriguez? Rodriguez, aye. File item number three, AB 1213 Berman? Berman, aye. Cervantes? Cervantes, aye. Vince Fong? Vince Fong, no. Jones-Sawyer? Jones-Sawyer, aye. File item number four.

AB 1278. Vince Fong? Vince Fong. Aye. Okay, we are done. This concludes the Assembly Insurance Committee. Thank you.