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BWC Settles Group Rating Suit

BWC Settles Group Rating Suit

The Ohio Bureau of Workers’ Compensation (BWC) recently agreed to a $420 million settlement of the San Allen case, a class action lawsuit filed in 2007 against the state of Ohio over the BWC’s setting of premiums related to the group rating program.  Several Court decisions leading up to this settlement ruled that BWC overcharged a significant amount of Ohio employers on their workers’ compensation premiums over the period 2001-2008.  In essence, group rated employers received premium discounts while those not in group rating plans were charged more to subsidize the group discounts.

BWC has made significant changes to its rate making policies and system to address the issues that were at the heart of this suit.  BWC improvements to many areas within its system, including how premium discounts are calculated and how they invoice have allowed the BWC to achieve premium rate decreases while at the same time realizing stability and even growth with the State Fund.

The state has agreed to create a $420 million fund to pay claims to eligible employers.  Claims will be filed with a third-party administrator appointed to manage the claims process.  Final details are still being discussed; however, here are some of the initial timeframes:

  • August 22, 2014 – claim notification forms were sent to employers, which require employers to fully complete and return
  • October 22, 2014 – claim forms are due to the designated claims administrator (postmarked by Oct 22)
  • December 10, 2014 – Cure Period – the claim administrator will check for errors or omissions and provide employers opportunity to correct through December 10
  • January 7, 2015 – claims administrator must complete claim process and compile report with all claim amounts for the class members that submitted claim notification forms
  • Mid to Late January 2015 – final discharge from the judge and then checks can be released

We’re told that employers should be able to see and verify their restitution amounts when they receive their claim notification forms.  Please note that the above timeline has not been finalized and Matrix will continue to provide updates and information as it’s released. There is quite a bit of misinformation in the marketplace regarding this settlement, so please contact Matrix for any guidance and assistance. Let Matrix be your guide.  Contact us at 513.351.1222 or toll free at 877.550.7973.