Ohio BWC Board Of Directors Takes Steps To Improve Ohio's Group Rating Program

Columbus, OH (CompNewsNetwork) - The new, 11-member Bureau of Workers' Compensation (BWC) Board of Directors took action today on two measures aimed at making Ohio's workers' compensation system more competitive with other states and providing parity in the premiums paid by private and public employers.

First, the BWC Board of Directors in attendance unanimously approved a recommendation from Administrator Marsha Ryan to fully review the Ohio Group Rating Program, with an initial reduction of the group discount to be no less than 80 percent for the 2008 policy year. The current maximum discounts for the program is 90 percent.

Today's action allows the Board's Actuarial Committee to comprehensively review the program and determine the appropriate discount rate. Once formally reviewed and approved, this change could reduce Ohio's base rates by approximately 4 percent overall.

“Ohio's workers' compensation base rates are currently the 12th highest in the country, hindering our state from economic development opportunities,” said BWC Administrator Marsha Ryan. “This action by the BWC Board of Directors demonstrates our commitment to make Ohio's base rates competitive with those of other states, while also providing a level of fairness to employers who are not participating in groups.”

This reduction is a first step in making Ohio's workers' compensation premium rates more competitive with workers' compensation insurers in other states, making Ohio more attractive to businesses considering operations here. BWC will continue to work with the Board and stakeholders to fully review the Ohio group rating program and make further improvements.

BWC's group-rating plan allows employers that operate similar businesses to group together and potentially achieve lower premium rates than they could individually. Groups are sponsored by organizations such as trade associations and third-party administrators. The program provides deep discounts on workers' compensation premiums, which has caused a $200 million premium imbalance between group and non-group employers.

In a separate action, the Board approved an average zero-percent premium rate change for Public Employer Taxing Districts (PEC). PECs represent approximately 3,800 Ohio cities, counties, townships, villages, schools and special districts. This action means that overall premium for PEC entities will not increase for the upcoming year beginning Jan. 1, 2008. Individual PEC entities will see premium decreases or increases based on their own claims, but the total overall will not change from the current year.

“For the past five years, Ohio's public employers have experienced on average increases in their annual workers' compensation premiums totaling more than 20 percent,” said Chairman Bill Lhota. “We recognize that many of our public employers have been challenged in this area. This action demonstrates the commitment of the Board of Directors to ensure rate stability for all Ohio employers.”