Ohio: Workers' comp bureau appeals order to repay 'overcharged' premiums
The statement came in response to a Cleveland judge's order to pay back 264,000 employers for allegedly overcharging them in premiums.
The payment order in mid-March followed the December decision by Cuyahoga County Common Pleas Court Judge Richard McMonagle in favor of business owners who had filed a class action. They argued they were charged excessive rates to pay for discounted premiums given to companies that joined group insurance plans. The program provides discounts to companies with good safety records and few claims.
The lawsuit began in 2007 and said the BWC did not charge premiums that covered the losses for the companies paying group rates, which forced other companies to cover the difference. The plaintiffs said the inflated premiums were charged from 2001 to 2009.
Some companies are owed $5,000 while others are due more than $100,000, according to the decision. But the BWC says its actions were lawful and restitution "is not warranted in this case."
The BWC issued a statement and cited:
- The actual claims costs and expenses of the companies in the class exceeded their premiums paid to BWC at a disproportionately higher rate than those companies not in the class. These employers' claims' costs were $861 million more than the premiums they paid during the period, and BWC's net assets decreased by $2.5 billion over that period.
- On a dollar-for-dollar basis, for every dollar of premium collected during the class period, the class members as a whole had $1.26 in claims costs.
- Every dollar BWC collects from employers is spent on the prevention of workplace accidents and the care of those Ohioans injured on the job.
"Ohio's private employers have saved an estimated $210 million in premiums over the past two years, during which time BWC reduced base rates and reduced its administrative budget," the statement said.
Read more at the WorkersComp Forum homepage.
April 15, 2013
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