The Texas Department of Insurance, Division of Workers Compensation (TDI-DWC) approved one initial application and 13 renewals of certificates of authority, to self-insure for workers compensation claims for a one-year period under the TDI-DWC Self Insurance Program to 14 companies employing approximately 188,000 employees in Texas.
Under Texas law, certain large, private companies can self-insure for workers compensation claims, while retaining the protection of the Texas Workers Compensation Act for the company and for its employees. To qualify, a company must have a minimum workers compensation insurance unmodified manual premium of $500,000 and meet other requirements subject to annual review.(WCxKit)
According to the Texas Department of Insurance, certified self-insurance is a program that allows private employers in Texas to self-insure for their workers compensation losses – it is allowed because workers compensation coverage is not mandatory in Texas. Employers wanting to self-insure apply to the TDI-DWC and, if approved, pays its own workers compensation losses.
The companies affected by the most recent self-insurance certificates are:
- AAA Cooper Transportation, Dothan, AL
- American Electric Power Company Inc., Heath, OH
- Archer-Daniels-Midland Company, Decatur, IL
- Baker Concrete Construction Inc., Monroe, OH (new to program)
- FedEx Ground Package System, Inc., Pittsburgh, PA
- Hyatt Corporation, Chicago, IL
- Limited Brands Inc., Columbus, OH
- Lockheed Martin Corporation, Fort Worth
- Parker-Hannifin Corporation, Cleveland, OH
- Poly-America L.P., Grand Prairie
- Sam Kane Beef Processors Inc., Corpus Christi
- Union Tank Car Company, Chicago, IL
- VF Corporation, Greensboro, NC
- Wal-Mart Associates Inc., Bentonville, AR
Among the qualifications for self-insurance in Texas are the following:
- A private employer with operations in Texas.
- An estimated unmodified manual insurance premium of at least $500,000 in Texas, or at least $10,000,000 nationwide.
- Presentation of audited financial statements.
- Qualifying Credit/Debt ratings.
- A qualifying Tangible Net Worth to Long Term Debt ratio of 1.5 to 1, with Minimum Tangible Net Worth of $5 million.
- Posting of a minimum security deposit of $300,000.
- Posting of excess insurance in the amount of $5 million per occurrence.
- Submission of an “Application for Certificate of Authority” to SIR; and
- Payment of a non-refundable $1,000 application fee.
In other news, the TDI-DWC will be hosting some educational sessions on pharamacy closed formulary. The sessions are open to are for all Texas workers compensation participants, including health care providers, pharmacists, insurance carriers, claim adjusters, case managers, and attorneys. The free sessions provide information on the new TDI-DWC pharmacy closed formulary rules, adopted in December 2010 for both certified workers compensation network (network) and non-network claims with dates of injury on or after Sept. 1, 2011. The sessions will provide information on the definition and application of both the open and closed formularies.(WCxKit)
For more details, visit the TDI-DWC Events and Training Calendar on the TDI website at www.tdi.texas.gov/wc/events/index.html.
- Abilene Nov. 10, 2011
- Amarillo Oct. 25, 2011
- Austin Oct. 20, 2011
- Beaumont Nov. 17, 2011
- Bryan Nov. 30, 2011
- Corpus Christi Nov. 3, 2011
- Dallas* Nov. 8, 2011
- El Paso Oct. 18, 2011
- Houston** Nov. 15, 2011
- Laredo Nov. 3, 2011
- Lubbock Oct. 25, 2011
- Lufkin Nov. 17, 2011
- Midland Nov. 10, 2011
- San Angelo Nov. 10, 2011
- San Antonio Oct. 27, 2011
- Tyler Nove. 30, 2011
- Waco Nov. 30, 2011
- Weslaco Oct. 25, 2011
- Wichita Falls Nov. 30, 2011
This information was provided by attorney
Stuart Colburn, a Shareholder at Downs Stanford in Austin, Texas. Colburn has extensive experience in all phases of dispute resolution before the Texas Department of Insurance, Division of Workers Compensation and in district courts across the state. Stuart represents clients regarding workers compensation, non-subscription, subrogation, and bad faith litigation. He is the founder and the first chairman of the State Bar of Texas (SBOT) Workers Compensation Section; course coordinator for the SBOT the Advanced Workers Compensation Seminar; and course coordinator for the Texas Workers Compensation Forum. He can be reached at:
scolburn@downsstanford.com
Our WORKERS COMP BOOK: www.WCManual.com
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact
Washington State Gov. Chris Gregoire has signed into law a bill that orders the states Department of Labor and Industries to form a statewide medical provider network for injured workers.
The new law will reportedly trim $218 million in spending over four years from Washingtons monopoly workers compensation system by forming a network of doctors who meet a number of standards and apply best practices. (WCxKit)
Additionally, the law allows injured workers to choose their doctor within the network and calls for formulating an electronic system to track “evidence-based quality measures and outcomes,” according to a statement.
“We know we need to help more workers return to good health and back on the job after an injury, as well as reduce costs for our taxpayers and businesses,” Gov. Gregoire remarked in the statement.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. See www.LowerWC.com for more information. Contact:Info@ReduceYourWorkersComp.com or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com.
A Reader Asks:
If an employer is in a non-monopolistic state and the employee’s residence is in a non-monopolistic state, but may work from time to time in a monopolistic state, what state should work hours be reported in?
Workers Comp Kit Blog Replies:
Normally, the state where the employee is domiciled is where the employee is counted for workers comp purposes.
If the employee is traveling on business in a monopolistic state, and if the employee is not there long enough to qualify to pay that state’s income tax, then the workers comp premium is based on the employee’s home state. (WCxKit)
On of our claims experts is in Kentucky this week and next week doing an audit for a for a large pool. Kentucky is not a monopoistic state. To be an employer subject to WC laws,. you must have two or more employees who work 20 weeks or more during the year. While each state sets their own requirements, the casual worker (like our consultant) here for two weeks would not require an employer to purchase wc coverage.
All four of the monopolistic states have a "help line" to answer such questions, but they will, of course, want the employer’s identity so the state can decide whether or not to assess a premium. To find those help line go to
http://reduceyourworkerscomp.com/workers-compensation-state-laws-and-regulations.phpNote: Our answer is a generalization. Do not rely on the above! Call your broker and ask someone well acquainted with your circumstances.
\ Author Rebecca Shafer, J.D./ Consultant, President, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: Info@ReduceYourWorkersComp.com or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
The question was recently asked: “Will cost containment work if my business is located in a monopolistic state?” The answer is an absolute YES! [If you are wondering, a monopolistic state is a state where the employer is required to purchase Workers compensation insurance from the state government]. All four of the monopolistic states (Ohio, North Dakota, Washington, and Wyoming) have state sponsored programs encouraging employers to reduce the number of work related injuries.
The largest monopolistic state, Ohio, uses the employer's claim experience to determine the rate the employer will be charged for work comp coverage. The Ohio Bureau of Workers Compensation operates along the same principles as a standard workers compensation insurance company. It uses an experience modifier factor to determine the workers comp insurance rate for each employer. Employers with higher than average claim history pay higher than average workers comp insurance rates, while employers with lower than average claim history pay lower rates. (WCxKitz)
North Dakota's Department of Workforce Safety & Insurance places a very strong emphasis on the cost containment approach of having a transitional work plan – also known as a return-to-work program or a modified duty program. The state government of North Dakota encourages employers to put injured workers back to work on light duty and for employees to return-to-work on light duty as soon as the treating physician agrees the employee is capable of working light duty.
North Dakota uses a retrospective rating plan to lower the cost of workers comp coverage for the employers with a better than average loss experience. With a retrospective rating plan, if the cost of claims is better than expected, the employer receives a partial refund of the workers comp premium. The lower the cost of claims, the greater the refund.
Washington State Department of Labor & Industries emphasizes the need for each employer to have a safety program and a return-to-work program. Washington's L&I has a slogan — “Prevent Injuries & Save Money.” Washington State also uses a retrospective rating plan refunding a portion of the workers comp premium to the employers who have a better than average loss history.
Wyoming's Department of Employment Workers Safety and Compensation Division promotes their safety discount program. Wyoming uses a cost benefit analysis to show the employer the cost of providing a safe work place is less than the cost of higher work comp rates. Wyoming also has a Risk Management Services department to assist the employer in quantifying the benefits, methods and cost of various cost containment measures.
All four of the monopolistic states want employers to take active steps to mitigate and contain costs. Each of the monopolistic states rewards the employers with lower workers comp cost when they reduce the number of workers comp injury claims.
The following are recommendations for employers in the monopolistic states (and employers everywhere) on workers comp cost containment measures:
1. Have an established return-to-work program providing modified duty or light duty work for your employees before the injury occurs. This will allow you to get an injured employee back to work as soon as the treating doctor will allow. Request the work restrictions from the medical provider at the time of the initial treatment.
2. Have an established protocol of on-going communications with every injured worker until the worker is back on the job.
3. Have a strong safety program to eliminate injuries before they occur. Constantly promote job safety and preventive measures. Be sure employees are properly trained to operate equipment or machinery, and know proper lifting techniques.
4. Be a drug-free workplace with an active drug-testing program.
5. When the medical provider will not permit the employee to return to work on modified duty, assign a nurse case manager (NCM) to the claim to provide medical management. NCM has a positive impact on the medical cost.
6. If your business operation is large enough, employ a staff nurse or doctor to treat workers comp injuries on-site. (WCxKitz)
7. Have a pre-employment screening program.
8. Have an active fraud prevention program.
Summary
Cost containment, whether you are in a monopolistic state or one of the other 46 states, is an absolute for any employer who wants to have a positive impact on the cost of workers compensation insurance. Your company will be rewarded with lower workers comp insurance costs with the added benefit of your employees knowing you care about their safety and their return to work when they are injured.
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Author Rebecca Shafer, P PPPresident, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: RShafer@ReduceYourWorkersComp.com or 860-553-6604.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
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Employment Law Issues, Insurance Issues, Rates, Premiums, Monopolistic States |
