Ohio Bureau of Workers Compensation (BWC) Administrator/CEO Steve Buehrer recently proposed a reduction in workers compensation rates for Ohio local governments by an overall average of nine percent beginning Jan. 1, 2016.
The reduction, combined with decreases implemented during the past five years, would result in a total average decrease to local government rates of 26.5 percent since 2011.
“BWC is pleased to once again propose an overall reduction for these public employers, saving them another $17.7 million and freeing up more resources for the programs and services that keep these communities thriving,” said Buehrer. “I encourage Ohio’s public employers to use some of their savings to invest in safety, which helps protect their workers and further reduce workers’ comp costs in the future.”
The new rates will cover 3,800 cities, counties, townships, villages, schools and special districts. The recommendation represents a reduction to the average of the collectible rates for these employers. Actual premium changes for individual public entities will differ based on several factors including their manual classification (the exact type of public entity), as well as their own recent claims history and program participation.
All Classifications Would See Lower Base Rates
Each of the 14 classifications associated with public employer taxing districts would see a decrease in base rates under the proposal. The base rate for townships would decrease by an overall 12.7 percent; villages by 8.8 percent; cities by 6.9 percent; counties by 6.2 percent; and school districts would fall by 7.9 percent.
The Jan. 1, 2016 effective date for the new public employer rates is the same day local governments will begin paying premiums under a new prospective billing system. Under the new system, which began July 1 for Ohio’s private employers, public employers will pay in advance for the upcoming year of coverage. Currently, they pay retroactively for the previous year of coverage.
Savings from the ability to collect premiums in advance of coverage accounts for 3.9 percent of the proposed overall reduction of nine percent.
Additionally, BWC is providing a premium credit to all employers totaling $1.2 billion to avoid double-billing during the transition; an estimated $200 million of that total will be credited to the accounts of local government employers beginning next May.
Author Kori Shafer-Stack, Editor, Amaxx Risk Solutions, Inc. is an expert in post-injury response procedures and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. www.reduceyourworkerscomp.com. Contact: [email protected].
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