Group Retrospective Rating Program
July 1, 2016
Group Retrospective Rating Program policy revised May 14,
2012; Group Retrospective Rating Program Complaint Policy revised July 23,
Revised October 17, 2016; May 14, 2012; June 28, 2011;
April 8, 2010. New policy issued December 9, 2009.
July 1, 2021
The Ohio Bureau of Workers’
Compensation (BWC) will provide a Group Retrospective Rating Program in
accordance with the applicable laws and rules.
This policy applies to
employers, Sponsoring Organizations, authorized representatives, and BWC
Retro Group: A Retro Group is continuing if more than fifty percent (50%)
of the members in the prior policy year continue to be members for the current
policy year. A change in the name of a Retro Group will not constitute a new
losses” or “total incurred losses (developed)”: Are a component of the
retrospective rating premium formula intended to account for the fact that
total incurred losses in claims are likely to increase over time. This trend
results from a number of factors, including, but not limited to, reactivation
of claims, additional claim awards, and claims that may be incurred but not
reported for a substantial period, and result in costs that would otherwise not
period: The three year period beginning immediately after the end of the
retro policy year. Annual evaluations will occur three times during the
evaluation period at twelve (12), twenty-four (24), and thirty-six (36) months
after the end of the retro policy year.
period: Has the same meaning as defined in OAC 4123-17-03(A)(1).
E. Green period:
The time interval between the last day of the experience period and the
misrepresentation: An act by an employer that would cause financial harm to
the other members of the Retro Group and is limited to any of the following:
Sponsoring Organization discovers the employer applicant has recently merged
with one or more entities without disclosing such merger on the employer’s
application for membership in the Retro Group, and such merger adversely
affects the employer’s risk of future losses, or
Sponsoring Organization discovers the employer applicant has failed to disclose
the true nature of its business pursuit on its application for membership in
the Retro Group and this failure adversely affects the loss potential of the
G. Group Retrospective
Rating or Group Retro Rating: A voluntary workers’ compensation insurance
program designed to provide a financial incentive to employer groups through
improvements in workplace safety and injured worker outcomes that are able to
keep their claim costs below a predefined level.
A requirement for Retro Groups that employers’ businesses in the organization
must be substantially similar such that the risks which are grouped are
losses: Compensation and medical payments paid to date plus open case
reserves on a claim. The total incurred losses, which are the cumulative sum of
all incurred losses on an employer’s policy, will not include surplus costs.
Total incurred losses will be limited to $500,000 per claim.
group: National Council on Compensation Insurance Classification Codes (NCCI
codes) are grouped into ten industry groups, set forth in OAC 4123-17-05,
Employers can have multiple NCCI codes assigned, but for purposes of
homogeneity may only have one primary industry group.
development factor (LDF): Actuarially determined factors that are
multiplied by the incurred losses of non-PTD/Death retro claims to produce
developed losses. LDFs are unique to each retro policy year.
premium ratio: A factor pre-selected by the Retro Group that is multiplied
by the standard premium to determine the maximum retrospective premium. Options
for the maximum premium ratio are set forth in OAC 4123-17-73, Appendix A.
M. Member of a Retro
Group: An individual employer that participates in a Group Retro plan as
authorized under OAC 4123-17-73.
successor: A new employer entity that assumed the operations of a previous
member of the Retro Group, and the new employer entity has established a new
BWC policy. A newly established successor has the option of continued
participation for the remainder of the policy year.
O. New Retro
Group: A Retro Group is new if there is a change in Sponsoring Organization
or the Retro Group is moved to a new Sponsoring Organization or a new Retro
Group is formed.
BWC’s estimate of the future cost of a claim at a specific point in time.
Q. Retro Group:
The member employers who collectively form a group that participates in the
Group Retro plan of a Sponsoring Organization.
R. Retro policy
year: The policy year in which an employer is enrolled in Group Retro Rating.
For public employer taxing districts (PEC) the retro policy year is January 1 through
December 31. For private employers (PA) the retro policy year is July 1 through
date: The date BWC captures or “freezes” payroll and claim costs for rate
Organization: An entity (usually a business entity) with governing members,
which has been certified by BWC to sponsor and market Group Experience Rating
and Group Retrospective Rating programs. Certification requirements for
Sponsoring Organizations are set for in OAC 4123-17-61.1.
See also Sponsorship
premium: The total premium paid by, or on behalf of, an employer for a
given policy year, excluding charges for Disabled Workers’ Relief Fund (DWRF)
and the administrative cost fund. In determining standard premium, total
premium paid will not be reduced by any rebates or dividends issued pursuant to
Aggregate standard premium is the sum total of standard premiums for all
employers in the Group.
Party Administrator (TPA): Any person or organization that works with
certified Sponsoring Organizations to administer and facilitate an employer’s
application to Group programs.
A. Retro Group
Retro Group seeking participation in the program must meet the following
Retro Group must be sponsored by a BWC certified Sponsoring Organization.
employers’ primary business pursuit as determined in (i) below must be
homogeneous with the other employers in the Retro Group.
Homogeneity is determined by the main operating manuals of the employers
as determined by the predominant premium obligations for the rating year
beginning two years prior to the retro policy year. Industry groups are
determined by OAC 4123-17-05,
Industry groups seven and nine as well as eight and nine are considered similar.
BWC may allow an employer to move to a more homogeneous group, after
December 31, for private employers and June 30, for public employers (but
before the application deadline), if the employer is:
employer without a full year of recorded premium;
as a result of an audit; or
or partially combined with another employer.
Retro Group of eligible employers must have aggregate standard premium in
excess of $1 million as determined by BWC based upon the last full policy year
premium information is available.
employers without a full year of recorded premium, BWC may use expected premium.
will use the experience modified premium of the individual employers excluding Group
Experience Rating discounts.
Retro Group must have at least two eligible employers.
Retro Group must substantially improve accident prevention and claims handling
for the employers in the Retro Group. BWC will require the Retro Group to
document its safety plan or programs for these purposes. For Retro Groups
reapplying annually for Group Retro coverage, BWC will require the results of
prior programs. The safety plan must follow the criteria outlined in OAC 4123-17-68.
See also the Sponsorship
Certification policy for additional information.
employer must be a PA or PEC employer. Self-insuring employers and state
agencies are not eligible.
employer must have active workers’ compensation coverage defined as follows: As
of the application deadline, the employer must:
current with respect to all payments due BWC as defined in OAC 4123-17-14.
current on the payment schedule of any part-pay agreement into which the employer
entered for payment of premium or assessment obligations.
Not have cumulative lapses in workers’ compensation coverage in excess
of forty (40) days within the prior twelve (12) months, except:
For the policy year beginning July 1, 2015, a PA employer must not have
cumulative lapses of workers’ compensation coverage in excess of forty (40)
days within the prior nine months.
For the policy year beginning January 1, 2016, a PEC employer must not
have cumulative lapses of workers’ compensation coverage in excess of forty
(40) days within the prior nine months.
employer must timely report actual payroll for the preceding policy year and
pay any premium due upon reconciliation of estimated premium and actual
premium. An employer will be deemed to have met this requirement if BWC
receives the payroll report and the employer pays premium associated with such
report before the expiration of any grace period. See the Payroll
True-Up policy for additional information.
employer may not be a member of more than one Retro Group. Further, an employer
cannot be a member of a Group Retro plan and a Group Experience Rating plan in
the same policy year.
employer’s Group Retro Rating application will be rejected if the employer has
been included on a Group Experience Rating roster for the upcoming policy year.
employer must be homogeneous with the Retro Group. There are exceptions to the homogeneity
requirement. These exceptions include an employer:
a continuing Retro Group who initially met the homogeneity requirement. BWC
will not disqualify such employer from participating in the continuing Retro
Group for failure to continue to meet the homogeneity requirement;
a full year of recorded premium;
Reclassified as a result of an audit;
or partially combined with another employer; or
the highest overall premium falling under the standard exception manual
classification(s) has the option to participate in a Retro Group associated
with another operating manual classification.
The standard exception manuals included in this rule are:
Clerical Office Employees;
Clerical Telecommuter Employees;
Drivers, Chauffeurs, and their Helpers;
Salespersons, Collectors or Messengers, Outside; and
The standard exception does not apply in every case and is determined by
the true nature of the employer’s business.
Professional Employer Organizations and temporary service agencies are
ineligible for the standard exception manual rule.
groups seven and nine as well as eight and nine are considered similar.
However, industry groups seven and eight are not considered similar and premium
from industry group seven or eight cannot be combined with premium from
industry group nine make industry group seven or eight the dominant industry.
requirements / BWC evaluation of application.
application deadline for PA employers is the last business day of January.
application deadline for PEC employers is the last business day of July.
apply for the Group Retro Program through Sponsoring Organizations that are
certified by BWC.
employers who are not included on the final Employer Roster for Group
Retrospective Rating Program (U-152) or who do not have an Employer Statement
for Group Retrospective Rating Program (U-153) for the same Sponsoring
Organization on file by the application deadline will not be considered for the
Group Retro plan for that policy year. BWC may waive this requirement for good
cause shown due to clerical or administrative error so long as no employer is
added to a Retro Group after the application deadline.
BWC may request additional information from individual employers, as
needed, in order to process an application and determine an employer’s
eligibility for participation.
Retro Group’s application is applicable to one policy year. The Retro Group
must reapply each year for Group Retro Rating.
of a Retro Group for subsequent policy years is subject to timely filing of an
application and meeting eligibility requirements each year.
The Sponsoring Organization must:
Apply for Group Retro by submitting a completed Application for Group
Retrospective Rating Program (U-151) to BWC with all required documentation by
the application deadline. The U-151 must be signed by an officer of the Sponsoring
Organization. BWC will reject the application if all relevant information is
Select a maximum premium ratio on the U-151.
Identify each individual employer in the Retro Group by submitting the
U-152 to BWC.
to BWC a U-153 for each employer participating in the Sponsoring Organization’s
the employer files a U-153 within sixty (60) days prior to the application
deadline, it will be presumed that the latest filed U-153 indicates the
employer’s intentions for Group Retro for the upcoming policy year.
U-153 will remain in effect until the end of the policy year indicated on the
U-153 must be signed by the chief executive officer, owner/partner, or
designated management representative of the employer.
may request additional information from the Sponsoring Organization. Failure or
refusal by the Sponsoring Organization to provide the information on the forms
or computer formats provided by BWC will be sufficient grounds for BWC to
reject the application and deny the Retro Group’s participation.
evaluation of application:
will take the following actions upon receipt of an application for Group Retro
Determine the industry classification of the Retro Group based upon the composition
of employers in the Retro Group.
Screen individual employers to ensure they fit within the Retro Group’s
If BWC determines an individual employer does not meet the eligibility
requirements, BWC will notify the individual employer and the Sponsoring
Organization of this fact. The Retro Group may continue its application for
Group Retro without the disqualified employer.
will only honor changes to the original application that are filed on a U-153
and filed with BWC prior to the application deadline.
Rescissions must be made in writing and signed by an officer of the
BWC will use the latest application form, or rescission received, in
determining Group Retro Rating participation.
D. Operation of
Retro Group may not voluntarily terminate a Group Retro plan after application
has been made.
employer who sustains a claim within the “green period” must complete one of
the following during the policy year of participation:
two hours of safety training.
BWC’s online accident analysis training and submit a DFSP-1
accident analysis report on the claim(s) that occurred in the green period.
employer participating in the Group Retro Program may participate in other
compatible BWC discount programs during its participation in the Group Retro
Program. Employer compatibility for Group Retro Rating is outlined in OAC
4123-17-74, Appendix C.
Retro Group that has been established and accepted by BWC may select an
authorized representative as follows (see the Employer
Authorized Representatives policy for additional information):
permanent authorized representative may be selected to represent the Retro
Group and the individual employers of the Retro Group for all risk-related
matters relating to BWC and the Industrial Commission.
Sponsoring Organization will select an authorized representative by submitting
a U-151 to BWC. The U-151 must be signed by an officer of the Sponsoring
Organization. An authorized representative may be changed or terminated only by
the subsequent submission of a U-151.
employer pays its individual premium during Group Retro Rating participation.
will consider the Retro Group as one entity when calculating the Group
Group Retrospective premium calculation will occur three times during the
evaluation period; at twelve (12), twenty-four (24), and thirty-six (36) months
following the end of the Group Retro policy year.
the evaluation date, BWC will evaluate all claims with dates of injury during
the Group Retro policy year where the policy of record was a Retro Group member
on the date of injury. The incurred losses and reserves for these claims
will be captured. An actuarially determined LDF will be applied to the total
incurred losses and reserves for the entire group. The LDFs can be found in OAC
4123-17-73, Appendix C.
The Retro Group’s premium will be calculated based on the developed incurred
losses and reserves of the group.
Group Retrospective premium will be compared to the standard premium and all
subsequent Group Retro refunds/assessments.
The difference between Group Retrospective premium and standard premium will
be distributed or billed to the employers as a refund or assessment.
Assessments will be limited by the maximum premium ratio selected by the
Retro Group at the time of application.
BWC will not apply any reserving method that suppresses some portion of
the employer’s costs for the purpose of calculating an experience modification
BWC may hold a portion of refunds or defer assessments owed in the first
and second evaluation periods to minimize the volatility of refunds and
assessments. BWC will fully distribute any net refund or assessment in the
third evaluation period.
claims of a Retro Group’s members enrolled in Salary Continuation at the time
of evaluation, the full indemnity reserve will be included in the incurred
losses but no amount will be included for indemnity paid.
and assessments will be distributed directly to eligible individual employers
based on the percentage of the total group standard premium paid by the
employer at the time of the evaluation. This percentage will be multiplied by
the refund or assessment and the resulting amount distributed or billed to the
BWC will send premium credits within four months of the evaluation date
to eligible participants.
If additional premium is owed, it will be included in the employer’s
next invoice and must be paid by the due date on the invoice. BWC will charge
penalties on additional premium not paid when due.
If an employer has an outstanding balance with BWC, BWC will deduct such
monies from the credit. BWC will then refund the difference, or if a premium
balance is still due, send a bill for the balance.
the application deadline, but before the end of the policy year, the Sponsoring
Organization may notify BWC it wishes to remove an employer from the Retro
Sponsoring Organization may request the employer be removed from the Retro
Group after the application deadline only for the employer’s gross
misrepresentation on its application to the Retro Group.
Sponsoring Organization must notify the employer of its request to remove the
employer from the Retro Group for gross misrepresentation.
burden of proof is on the Sponsoring Organization to provide sufficient documentation
as determined by BWC.
will review the request and the employer will only be removed with BWC’s approval.
F. BWC will
remove an employer from the Group Retro program for the current policy year if
the employer fails to comply with section IV.B.3 above and the following will
costs for all injuries incurred from the beginning date of the policy year
through the date of removal from the program will be included in the Group
Retrospective calculation, and
premium paid from the beginning date of the policy year through the date of removal
will be included in the Group Retrospective calculation for the participation
G. Resolution of
complaints should be processed under the General
Employer Complaint Policy.
extenuating circumstances that apply to the Group Retrospective Rating Program:
A new employer is not homogeneous with the Retro Group to which
Extenuating circumstance: An employer, having no reported payroll and
premium during the period specifically mentioned in the Group Retro Rating
rules, is rejected because it is not homogeneous with the Retro Group to which
it applied. BWC may permit the employer to participate in a Retro Group that is
homogeneous with the employer’s operation as long as the Retro Group is with
the same Sponsoring Organization. The employer, Sponsor Organization, and TPA
must be in agreement with the decision.
Supporting documentation required:
employer has no reported payroll;
appropriate Group Retro Rating forms were timely filed;
employer is not rejected for any other reason; and
same Sponsoring Organization has another group the employer could be placed
into that would resolve the homogeneity issue.
Employer rejected from Group Retro Rating after being accepted
into Group Experience Rating for the same policy year.
Extenuating circumstance: An employer is listed on a Group Experience Rating
roster that is submitted to BWC. After the application deadline for Group Experience
Rating, the employer requests removal from Group Experience Rating in order to
apply for the Group Retro Rating for the same policy year. BWC denies the
employer request to be removed from Group Experience Rating because the request
was made after the application deadline. BWC denies the employer’s application
for the Group Retro Rating program because the employer is enrolled in Group Experience
BWC will grant the employer’s request to be removed from Group Experience
Rating after the application deadline date and to be placed in Group Retro Rating
if all of the following requirements are met:
employer, Group Experience Sponsoring Organization, and Group Retro Sponsoring
Organization provide BWC with a written request to remove the employer from Group
Experience Rating and add the employer to Group Retro Rating. All three
requests must be submitted on company letterhead and be signed by an authorized
letters must be received by BWC no later than thirty (30) days after the
notification of the denial to the Group Retro Rating program.
removal of the employer from Group Experience Rating does not change the Group
Experience Rating group’s calculated EM. The removal of the employer must
result in no financial impact to the balance of the Group Experience Rating group
employer must meet all other eligibility requirements of the Group Retro Rating
transfers and changes of ownership; as set forth in OAC 4123-17-73(S).
wholly succeeds predecessor: The successor will be responsible for all existing
or future rights and obligations stemming from predecessor’s current or past
participation in the Group Retro Program, as outlined in OAC 4123-17-02(C).
transfer: If predecessor has any Group Retro policy years in the evaluation
period, it will retain rights, liabilities, and obligations set forth in OAC
involving a newly-established successor.
Full transfer of operations to single, newly-established successor:
Predecessor’s eligibility for Group Retro Rating will transfer to successor.
Partial transfer of operations to single, newly-established successor:
Predecessor’s eligibility for Group Retro Rating will transfer to successor; successor
determines whether it will participate.
Transfer during the current policy year, or sixty (60) days prior to the
application deadline: The successor may be considered a member of the Group
Retro Program if agreed to by both the successor and Sponsoring Organization.
The successor and the Sponsoring Organization must submit a written agreement
to BWC within thirty (30) days of the date BWC updates the predecessor’s policy
status to combine.
participation is dependent on meeting Group Retro eligibility requirements.
or part of predecessor’s operations are merged with existing operations of
successor: Predecessor’s eligibility for Group Retro Rating will not transfer
to successor. Predecessor’s Group Retro plan(s) will terminate as of the ending
date of the evaluation period.
cancels coverage: The employer’s premium and losses will remain with the Retro
Group. The resulting refunds or assessments will be disbursed to or collected
from the remaining members of the Retro Group. The Sponsoring Organization and its
authorized representative have the right to represent the interest of the
canceled employer on behalf of the Retro Group for claims which occurred during
the year(s) the cancelled employer was in the Sponsoring Organization’s Retro
files bankruptcy: If a current or past Group Retro Program employer with open
retro policy years files a petition for bankruptcy, the employer must notify
BWC Legal by certified mail within five working days from the date of the bankruptcy
filing. BWC will petition the bankruptcy court to take appropriate action to
protect the state insurance fund and other related funds.