Recently a Supreme Court hearing allowed a settled claim to be reopened due to the inappropriate claimant interpretation of value and future benefit needs. This has caused major concern among the Ohio Bureau of Workers’ Compensation employers, injured workers, and their representatives. (See the attached story Ruling on BWC Case Settlement)
However, I feel that settlements in the Ohio state insurance fund are like putting a Band-Aid on an infected cut. The problem in the Ohio state fund is the inappropriately high reserves assigned to claims that increase the premiums to the employers.
If the claim reserves appropriately mirrored the objective activity of the claim, settlements would not be required in most cases. Everyone, including the Ohio BWC, has been seeking settlements for the simple purpose of removing inappropriate reserves on claims.
Most recently, it is our understanding that the Bureau is initiating a settlement letter very early in the claim. The Bureau settled 255,266 claims between 1997 and 2007. We have heard that there are eight times more settlements in Ohio state fund workers’ compensation claims than any other state in the country. This undeniably reflects the inappropriate reserving in the claims. These settlements seem to be a temporary solution rather than fixing the actual reserve problem.
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