Assembly Democrats yesterday thwarted Mayor Bloomberg’s push for legislation to prevent government workers who are injured on the job from suing the city for lost earnings already paid out by accident disability pensions.

For years, the city and other municipalities have urged the Legislature to stop the double payments to injured public employees, saying the legal loophole costs taxpayers $11 million a year.

Assembly Democrats have deferred to trial lawyers, a powerful interest group in Albany that has opposed the legislation because it would decrease plaintiff recoveries. The Democratic speaker of the Assembly, Sheldon Silver, is a trial lawyer and counsel to a personal injury law firm in Manhattan, Weitz & Luxenberg.

This year, the Assembly is advancing a bill that would ostensibly meet the mayor’s demands. It would require that accident disability pensions, which are paid by the city, count against lawsuit damages.

However, Democrats added a separate provision — one that applies to the wider tort arena — that would end up boosting payouts to trial lawyers.

The bill, which is sponsored by Assemblywoman Helene Weinstein, would also prevent health insurance companies from recouping benefits from a personal injury plaintiff’s recovery of damages.

Senate Republicans are strongly opposed to limiting the reimbursement rights of insurance companies. The question of whether insurance companies can go after settlement proceeds is uncertain under case law in New York.

The Bloomberg administration had lobbied heavily for a bill that did not include the separate provision but was rebuffed by the Assembly. Ms. Weinstein’s bill yesterday was approved by the Judiciary Committee and is now being considered by Ways and Means.