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For Immediate Release: Dec. 21, 2007
BWC Board of Directors Holds Final Meeting of 2007
Agency Continues Commitment to Accountability, Fairness and Improved Service
COLUMBUS – The Ohio Bureau of Workers’ Compensation (BWC) Board of Directors held its final meeting of 2007 this
week. Board actions included rule changes to the Marine Industry Fund and the Coal Workers Pneumoconiosis Fund, as well
as approvals to issue a Request for Proposals (RFP) for investment management services.
With the board’s guidance, BWC has made significant progress toward building a system that is fair, reliable and
equitable for Ohio employers and injured workers throughout 2007.
A year in review
Shortly after taking office, Governor Ted Strickland made reformation of BWC’s governance and oversight structure a
priority in his fiscal years 2008 and 2009 biennium budget bill (HB 100). That reformation included the creation of
the position of deputy inspector general, specifically appointed within the BWC and the Industrial Commission of
Ohio (IC). Deputy Inspector General Joe Montgomery began his duties on Sept. 17. His role includes the investigation of
wrongful acts or omissions committed by BWC and IC officers and employees.
House Bill 100 also called for the creation of an independent board of directors, including business and labor
representatives, financial experts and four non-voting legislative members. Strickland said, “We must rebuild trust
and accountability in the BWC ... to be successful, we must ensure integrity, professionalism and efficiency in the
BWC system.”
To lead this effort, Strickland announced the appointment of Marsha P. Ryan as administrator of BWC, citing her
professionalism and years of public and private sector experience as strengths in carrying out the bureau’s important
obligations “efficiently and effectively.” Ryan officially began her duties as administrator on May 1, 2007.
“The strength of Ohio’s economy is rooted in the success of our business community and the well-being of its work
force,” said Administrator Ryan. “By providing a stable, fair and equitable workers’ compensation system, we can ensure
that employers will have an unwavering confidence in their premium investment, and injured workers will receive
quality care and compensation that will allow them to maintain their quality of life.”
As directed in HB 100, 11 non-legislative members of the BWC Board of Directors were appointed to represent the
interests of Ohio workers, employers and the public at large. The board also includes members with professional
expertise in financial accounting, investments and securities and actuarial management. The newly-formed board held
its first meeting on Aug. 23, 2007. One month later, it approved a zero-percent change in average premium rates for
public employers. Also in that Sept. 27 meeting, the BWC Board of Directors agreed to Administrator Ryan’s
recommendation to reduce the group-rating discount from 90 percent to no less than 80 percent for the upcoming
program year.
“Ohio’s group-rating program has lacked actuarial soundness since its inception,” said Administrator Ryan. “The
program was designed to allow like businesses to pool their experience and pay lower workers’ compensation premiums.
Because the 90-percent discount is so deep, and Ohio’s workers’ compensation system is revenue neutral, we see non
group-rated employers shouldering the additional $200 million needed to subsidize the current 90-percent group
discount.”
At a November public forum, more than 60 employers and employer representatives presented their positions on
lowering the group discount. The BWC Board of Directors then requested further study on the issue, asking staff to
present a plan by June 30, 2008, that addresses rules related to the composition and continuity of groups. Pending
further study, at its Nov. 21 meeting, the BWC Board of Directors made a significant decision to lower the group-rating
discount from 90 percent to 85 percent, effective July 1, 2008. The reduction is expected to save non group-rated
employers approximately $50 million and reduce Ohio’s premium base rate by approximately 2.5 percent.
“Reducing the group discount to 85 percent is a positive first step toward improving the group-rating program and
to ensure that all Ohio employers are paying their fair share for workers’ compensation coverage,” said Administrator
Ryan.
HB 100 also requires BWC to more accurately calculate reserves for Ohio employers. Lawmakers approved
funding that will allow BWC to invest in a new claims reserving system. This new system will be an advanced and
transparent reserving system that will more accurately estimate claim reserves that impact employer premiums.
The new BWC focuses on providing outstanding customer service to Ohio’s injured workers and Ohio employers. On
Dec. 7, BWC delivered a newly restructured contract to 25 managed care organizations (MCOs). The new contract
significantly increases performance requirements of the MCOs and enhances service to injured workers.
Additionally, the agency is working to streamline operations and reduce administrative costs. BWC recently
announced it will merge its Cincinnati Customer Service Office with its Governor’s Hill (Hamilton County) Customer
Service Office; and the Bridgeport Customer Focus Center with the Cambridge Customer Service Office, effective
Dec. 28. The resulting cost savings for these consolidations will be more than $1.48 million over the remainder of
the biennium budget cycle (fiscal years 2008 and 2009).
BWC helps employers and employees cope with workplace injuries by providing medical and compensation benefits for
work-related injuries, diseases and deaths, providing insurance to about two-thirds of Ohio's work force. In calendar
year 2007, BWC provided workers’ compensation coverage to more than 271,200 employers, processed more than 196,000 new
claims and paid more than $1.2 billion in benefits to Ohio’s injured workers.
Contact: Keary McCarthy
mccarthy.keary@bwc.state.oh.us
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