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BWC Updates and Overview of Prospective Billing for Public Employers
James R. BlazerJames R. Blazer
Regional Business Development Manager
Todd L. Spence
Regional Business Consultant
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Reform
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Recent Rebates to Employers
o In 2013 and 2014, BWC returned $2 billion in rebates to Ohio employers.employers.
o BWC to provide $1.2 billion transition credit to Ohio employers to ease the transition to a prospective billing system.
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Increased Commitment to Safety
o Expansion of Safety Council Program
o Creation of a research-to-practice program
o Partnership with State Fire Marshall
Development of safety curricula and funding for o Development of safety curricula and funding for skilled labor training program.
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Increased Commitment to Safety
o Safety Intervention Grants Program
o Workplace Wellness Grant Program
o Drug-Free Safety Program (DFSP) grants
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o Transitional Work Grants
o In fiscal year 2014, BWC awarded 849 grants totaling
$14,991,330 to 765 employers.
Safety Grants
o Assist in purchasing equipment that will substantially reduce or eliminate injuries
o 3-to-1 matching funds (up to $40,000)
o Payroll based grant request eligibility cycleso Payroll based grant request eligibility cycles
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Workplace Wellness Grant
o Purpose: To assist employers with the development and
implementation of workplace wellness program
o Goal: To control escalating costs of claims by o Goal: To control escalating costs of claims by
addressing health-risk factors
o $300 per participating
employee
o $15,000 per employer.
BWC claims paid out by decadeDecade Claims Payments in 2014
1940's 10 $107,425
1950's 231 3,021,109
1960's 1,810 26,927,823
1970's 6,266 86,239,016
1980's 13,048 177,707,172
1990's 18,739 250,260,564
2000's 42,965 551,426,047
2010's 147,828 611,786,125
Totals 230,897 $1,707,475,282
Customer"Focused Service
DeliveryNational view – private employer results
Safety programs are working
• Bureau of Labor Statistics • The national injury rate per 100 workers = 3.5.
• Private and public employers
• Ohio is 3.0.
• The 0.5 difference is important• 27,000 fewer injuries in Ohio!
• $540,000,000 / year savings to the fund
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Enhanced Care Pilot
•Removing barriers and impediments that delay care11
Enhanced Care Program
AshtabulaCarrollColumbianaCuyahogaGeaugaHolmesLakeLorainMahoningMahoningMedinaPortageStarkSummitTrumbullTuscarawasWayne
Pilot Region
Public Employer Rate Cuts Public employer taxing district rate reductions (2012 – 2016)
• Total average decrease to local government rates of 26.5% since 2011
• Total average decrease to local of 26.5% since 2011
• Lowest rates in more than 30 years
government rates of 26.5% since 2011
• Lowest rates in more than 30 years
Overview of Prospective BillingProspective Billing
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What is Prospective Billing?
o Prospective Billing is the process of paying workers’ compensation premiums in ADVANCE of receiving the coverageof receiving the coverage
o Previously, BWC premiums were paid AFTER the covered period is overo Public Employers: 1/1/2014-12/31/2014: May/Sept. 2015
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Why Transition to Prospective
Billing?
o Industry standard
o More flexible payment options
o Decrease in base rates by 4% for public o Decrease in base rates by 4% for public employers
o Increased ability for us to detect non-compliance and fraud
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Public Employer General Overview
(Transition Year)
o Prospective billing begins for public employers effective Jan. 1, 2016
• In 2016, payment time frames will remain the same as they are today. they are today.
o This year, BWC will send the 2016 Notice of Estimated Annual Premium December 31, 2015.
• In subsequent years, BWC will send it in late October.
o You will also receive your 2015 payroll report in December as normal.
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Notice of Estimated Annual Premium
o The 2016 EAP will use payroll from Jan. 1, 2014 –Dec. 31, 2014.
o Notice of EAP:• Cover letter• Cover letter
• Definition page
• Calculation/installment schedule page
• Certificate of coverage
o Deadline to modify 2016 estimated payroll/EAP is March 15, 2016 (must call BWC).
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PEC Transition Credit
Two transition credits:
o 2015 payroll transition credit – 50% of actual premium for Jan. 1, 2015, through Dec. 31, 2015, and;and;
o 2016 prospective transition credit – 50% of estimated premium for Jan. 1, 2016, through Dec. 31, 2016.
o Eligibility
• Active status on Jan. 1, 2016
• 2015 payroll report must be filed by Dec. 31, 2016 19
Public Employer General Overview
(Transition Year)
o 2016: Semi-Annual (2) Payment Plan for all PEC’s
o By March 31, 2016, we will send the first prospective invoice. invoice.
• We will apply a 50% transition credit to both the 2015 payroll report (upon reporting) and the 2016 invoice.
o Employers must report all of their payroll for the 2015 calendar year and will need to pay at least 50% of the premium due as well as their first prospective invoice by May 16, 2016.
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Public Employers – Jan. 1, 2016 to
Dec. 31, 2016
o BWC will send second invoice in August with a Sept. 1, 2016 due date (for the remaining 2015 and 2016 policy years).• The invoice will include the transition credit.• The invoice will include the transition credit.
o The 2017 Notice of Estimated Annual Premium will be sent by Oct. 31, 2016.
o The first invoice will then be sent by Dec. 1, 2016.• First installment payment will be due by Jan. 3, 2017.
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Installment Options – Starting 2017
• Annual (1);
• Semi-annual (2); 2016 default installment selection
• Quarterly (4);
• Bi-monthly (6);• Bi-monthly (6);
• Monthly (12)- 2017 default installment selection
o 2016 installment plan cannot be changed
o 2017 installment plan can be changed until Sept. 30, 2017
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Deferred Payment Option
o Beginning in policy year 2017, public employers may choose to defer the first payment until April 30 of each year.• Employer must elect this option (online or over the
phone) on or before Nov. 15 of each year for the phone) on or before Nov. 15 of each year for the upcoming policy year.
o This option requires the employer to pay the January-May premium by April 30 each year.
o BWC will charge a deferment fee based on the established discount rate. • This fee will make up for the interest BWC will not earn
on the premium during this time period.23
Payroll True"up Reporto Prospective billing requires an annual payroll
true-up report.
o BWC will remind employers of this true-up requirement in January each year (beginning in 2017). First Public true-up due Feb. 15, 20172017). First Public true-up due Feb. 15, 2017
o The employer must report actual payroll for the previous year.• Online or over the phone only
• If additional premium is calculated, it is due by Feb. 15.
• If credit calculated, it will be released in normal process.
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Payroll True"up Report
o Actual payroll is critical for rate setting. For that reason, any outstanding true-ups will result in:• Immediate disqualification from rating plans and • Immediate disqualification from rating plans and
programs for that current policy year;
• Ineligibility to receive any rebates for the programs completed in the previous policy year;
• Ineligibility for rating plan or programs in the upcoming program year.
Rating Plan and Program
Enrollment Dates
o Group-experience rating – Last business day in May
o Group retro, One Claim Program, Deductible, o Group retro, One Claim Program, Deductible, Individual retro – Last business day in July
o Destination: Excellence – Last business day in November (Nov. 30, 2015)
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Nov. 30, 2015
Destination:
Excellence
enrollment
Public Employer Timeline
March 31,
2016
2016 invoice
mailed May 31, 2016
Group
enrollment
Jan. 1, 2017-
May 16, 2016
2015 payroll
report (min.
50% due) and
2016 invoice
due
Dec. 2015
2016 notice
of estimated
annual
premium and
2015 payroll
report mailed
July 29, 2016
Group retro,
one claim
program,
Deductible and
Individual retro
Sept. 1, 2016
Remaining
2015 and 2016
premium due
enrollment
•Destination: Excellence enrollment – Last business day of November•Dual premium billings: Payroll report and prospective invoice due May 16 – transition credit on both
•2nd invoice in 2016 for both policy year 2015 and 2016 due Sept. 1 (again, transition credits on both)
Jan. 1, 2016
MCO open enrollmentMCO open enrollment
Jan. 1, 2017-
Dec. 31, 2017
Transition creditTransition credit
July 1, 2016
Nov. 30, 2016
Destination:
Excellence
Public Employer Timeline
Dec. 1, 2016
Invoice
mailed for
policy year
2017
Oct. 31, 2016
Notice of
estimated
annual premium
mailed for 2017
policy year
Jan. 3, 2017
1st installment
due**
Jan. 3, 2017
Payroll true-
up report
notice sent
Feb. 15, 2017
Payroll true-up
dueExcellence
enrollment
• Policy year 2017 notice of estimated annual premium sent late October.• Policy year 2017 invoice sent Dec. 1; due Dec. 31.• Payroll true-up report sent Jan. 2, due Feb. 15.
**Deferred payment option can be used.
2017
Transition creditTransition credit
notice sent
January 2017
Web Resources
For more information, visit www.bwc.ohio.gov, click Employers, then click the Prospective billing link
o Overview document (with key dates)o Overview document (with key dates)
o Frequently asked questions, document and videos
o Timelines
o How-to videos coming soon
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