OH BWC Continues Progress In Lowering WC Premiums

                               Columbus, OH (CompNewsNetwork) - The Ohio Bureau of Workers' Compensation (BWC) has presented a proposal to the BWC Board of Directors' Actuarial Committee to further lower workers' compensation premiums by 5.5 percent for Ohio's 3,800 Public Employer Taxing Districts (PECs). The proposed reduction in base rates would take effect January 1, 2011, and if approved, would mean a 32.6-percent total reduction in base rates for PECs over the past three years.

BWC's recommendation follows a 24.6-percent base rate decrease during the current calendar year, and a five-percent decrease in 2009. The rate reduction has been proposed by BWC actuaries and representatives of Deloitte Consulting LLP. Lowering the PEC rate is possible due to BWC's now steady financial strength and the declining frequency of workplace injuries/claims.

“Over the past three years, BWC and our Board of Directors have implemented more accurate reserving, improved processes, cut down expenses and we have solidified our investment portfolio. This combination of factors is enabling us to further reduce the cost of workers' compensation insurance for the majority of Ohio employers,” said BWC Administrator Marsha Ryan. “With this proposal, PEC employers will see a 32.6-percent, three-year base rate reduction. Combined with an overall 35-percent base rate reduction for private employers over the same period, Ohio employers are saving money on their overall business costs, allowing them to compete in their industries and create jobs.”

PECs include Ohio cities, counties, townships, villages, schools and special taxing districts. Rates for individual PEC entities differ based on their individual claims history. While the total, overall premium collected could decrease by 5.5 percent from the current year, some employers may see an increase or no change, depending on their loss history. The Board is expected to vote on the staff proposal at its October meeting.

In other business, the Board created an independent Pharmacy and Therapeutics Committee. The Committee of up to 13 working pharmacists and physicians will advise BWC leadership on issues related to the use of medications prescribed to treat conditions related to injured worker claims. To enhance medication therapy for injured workers, the committee will: manage the development of a formulary of approved medications; review the performance of pharmacy providers; develop a list of non-covered medications, prior authorization criteria, medication treatment guidelines; advise the bureau on policies and procedures related to drug utilization; and review performance of BWC's pharmacy benefit manager.

The Board also approved modifications to BWC's Investment Policy Statement to allow for the implementation of a program utilizing qualified minority-owned and/or women-owned (MWBE) investment managers. BWC staff and investment consultant, Mercer, detailed the modifications, which allow MWBE investment managers to be chosen through a Manager-of-Manager (MoM) program that delegates the authority to identify, select and monitor appropriate MWBE investment managers to the MoM. The target asset allocation for MWBE investment managers is one percent of invested assets of the State Insurance Fund. Any selection of a MoM will be accomplished through BWC's standard request for proposal process.

Finally, as part of a comprehensive review of the vocational rehabilitation services provided to Ohio's injured workers, the Board hosted a forum of vocational rehabilitation professionals. The panel addressed a recent BWC study of MCO vocational rehabilitation referral patterns, and provided their views and suggestions for improving the administration of vocational rehabilitation programs and improving provider performance for the benefit of injured workers.

The next meeting of the BWC Board of Directors will be held Friday, October 22, 2010 at 8 a.m. in Room 3, Level 2 of the William Green Building, located at 30 W. Spring St., Columbus.  

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