BWC to Lower Group Rating Discounts for Ohio Employers

The BWC board members will be meeting later this month to finalize some proposed changes for the 2010 rate year. The BWC is continuing its efforts to establish more rating equity in the system between non-group and group rated employers. Once the BWC finalizes these proposed changes, ORM will begin providing 2010 Group Rating projections and/or rate consultation to our current clients.

Some BWC proposed changes:


1. The BWC is considering reducing the base rates for the 2010 rate year.

2. The maximum Group Rating discount for 2010 will be dropping from 77% to 65% for private employers. Some employers eligible for 2010 group rating may actually find a larger discount remaining outside of group rating, considering the base rate reductions and other program participation.

3. A Break Even Factor (BEF) will be applied again for the 2010 rate year. As you may recall, the BEF’s purpose is to offset the base rate reductions for employers that are eligible for group rating, and is applied after the group rating discount is determined. This means that a private employer with no claims in the experience period qualifying for a maximum 65% discount would actually receive about a 51% discount once the BEF is applied.

4. The BWC is planning to apply reserves to all Medical Only claims within the current and future 5 year experience period to impact rate determination beginning in 2011. This has the potential to include medical claims in the $15K Medical Deductible Program. This potential reserve, coupled with new federal Medicare/Medicaid reporting requirements, dramatically reduce the return on investment value of the $15K program.

If you are currently enrolled in the $15K Program, we strongly encourage careful consideration of continued participation in this program based on these new proposals and regulations.

5. The BWC will begin applying MIRA Reserves to claims where the employer has paid salary continuation in lieu of Temporary Total Compensation, affecting rate determination beginning in 2011. The BWC will not suppress these reserves as they have in the past. Although this will likely decrease overall cost savings seen in previous years for employers utilizing this option, salary continuation may still offer viable savings for some employers.

ORM will continue to provide you with assistance in determining which options are best for your company as we assess this evolving information. We will look at all options to help you determine the best financial solution possible.

If you have questions regarding any of the BWC Programs or proposed changes, please do not hesitate to call Brandy Jordan directly at (614)602-8273.

Stay tuned for further updates as we get them.

Making the Case for an Employer-Preferred Medical Provider Relationship

How many risk management seminars have you gone to over the years that have stated that the secret to successfully managing your workers’ compensation claims cost is early intervention?

This is not a new idea for any of us who have been in this arena for very long but it still remains one of the most challenging to implement within a bureaucratic workers’ compensation system that allows an employee up to two years to report an injury and/or occupational disease. These types of claims are the ones that keep us up at night and can quickly put a small employer out of business.

Experience has taught us that there is no one strategy that will solve all the complex issues that can occur in a workers’ compensation claim.

One Logical Solution: Have you tried developing a Preferred Medical Provider relationship with a local occupational health provider?

What is a Preferred Medical Provider Relationship?

A Preferred Medical Provider relationship between an employer and a local occupational health provider establishes familiarity prior to a work related injury. The Provider is given the opportunity to understand the company, what the employees do, the demands of the jobs, the environment in which work occurs, and what is expected in managing the care of an injured worker.


The Bottom Line

The most beneficial part of the Preferred Medical Provider relationship is the establishment of a trust between the employer, the provider and the injured worker.

1. The Employer trusts that the injured worker is getting quality, appropriate care and that there will be a safe and efficient return-to-work outcome in the claim.

2. The Provider has been informed about the company and their policies and practices and is secure that there will be full support and trust in their professional position.

3. The Injured Worker trusts that they are receiving appropriate treatment and that they have the full support of their employer.

These three players have the most influence in obtaining a successful claim outcome. An important best practice is the establishment of a working relationship of all parties with the mutual goal of ‘optimum services within the optimum evidence based duration of disability time frames’. All parties benefit from this type of relationship.

For assistance in establishing your Preferred Medical Provider relationship or to discuss any part of your risk management program, please call Brandy Jordan at 614.602.8273.

Dale Talks About Why We're Different

What's Driving the New Ohio BWC Premium Rates?

As many of you are aware, the Ohio BWC instituted numerous rate changes this past spring that are affecting your premium for the July 2009 rate year. There are two changes in particular that are driving the new premium rates that employers are facing.

The BWC:

1. Lowered the Base Rates, or “the rate by which the BWC multiplies your payroll to determine your premium” on average by 18%-30% which has a positive impact on an employer’s premium.
2. Also lowered the Allowed Losses, or “the dollar amount that an employer can incur in workers’ comp losses” by an average of 21% which has a negative impact on an employer’s premium.

The combination of these changes actually resulted in many employers paying more in premium despite the reduction in base rates.

Our goal is to assist all of you in understanding and controlling your workers’ compensation cost. OHP can review your workers’ compensation experience with you to see how these changes are going to affect your company moving forward over the next two years. We can then advise on a proactive risk management plan for your company.

Please contact Brandy Jordan at (614) 602-8273 / bjordan@ohpinc.com to have OHP begin this review for you.

NCCI Study Finds Injury Rate Drops During Recessions

The National Council on Compensation Insurance (NCCI) has released a report (June, 2009) that shows compelling evidence that the growth rate of the workplace injury and illness incidence rates drop during recessions. In addition, the study finds that these incidence rates rise during economic recoveries. At the same time, there is a widely held belief that layoffs, which tend to peak in recessions, lead to spikes in workers compensation claims.

The analysis attempts to reconcile the two opposing perceptions of the effect of an economic downturn on the growth rate of the reported workplace injury and illness incidence rate by studying how it is affected by changes in the rates of job creation, which may relate to an increase in the proportion of workers who are inexperienced in their current job and more likely to sustain a workplace injury, and job destruction, as employees affected by layoffs look to workers compensation for wage continuation.

Read the entire report at: www.ncci.com

Productive Integration - With Proven Results

Occupational Health Plan, Inc. (OHP) was founded in 1991 based on the recognition that Workers' Compensation costs were crippling businesses and medical providers were not positioned or empowered to resolve the escalating cost issue for employers. Since inception, OHP has been reducing Workers' Compensation and Disability cost for Ohio employers through the integration of Employer Policies, Claims Administration, and Local Medical Provider Partnerships.

OHP's Mission is to provide integrated Workers' Compensation Risk Management Services to employers that supports: High Quality Medical Care; Objective Disability Management; and Cost Effective Outcomes.

OHP is results oriented. We establish a pro-active risk management environment with the employer, employees, and local providers that changes the culture of claim cost control. We believe that Workers' Compensation cost control is best achieved through a coordinated relationship between medical providers and employers. To better coordinate these relationships and to offer employers and providers a comprehensive and integrated approach to managing Workers' Compensation costs, Vantage Occupatinal Health Plan (VOHP) and Occupational Risk Management (ORM) were created as affiliated companies to help realize the Mission.