Prospective Billing Installment Payments
Ohio Administrative Code (OAC) 4123-17-13,
July 1, 2015
New Policy July 1, 2015.
July 1, 2017
The Bureau of Workers’ Compensation
(BWC) provides coverage to an insured only after the payment of required
premium. BWC will permit customers to pay premium obligations in installments
as outlined in the applicable laws and rules.
policy applies to BWC Finance, Employer Services, Field Operations, Call
Center, private employers (PA), public employer taxing districts (PEC), and
policy does not apply to self-insuring (SI), public state (PES), Black Lung,
Marine Industry employers, or professional employer organizations (PEOs).
billing: A workers’ compensation insurance practice that provides coverage
to the insured only after the payment of premium.
annual premium (EAP): The annual estimate of premium utilizing the
estimated payroll and approved rates. BWC’s premium estimates are based on the
most recently completed policy year of actual payroll multiplied by the
employer’s blended rate for the policy year being estimated. New employers
applying for coverage on or after July 1, 2015, are required to provide twelve
(12) months estimated payroll on the U-3 application.
C. Notice of
estimated annual premium: A letter sent annually, in late spring to private
employers and late fall to public employers, in which BWC documents the
estimated payroll (exposure) for the upcoming policy year. Using the estimated
payroll, assigned manual classifications, and approved rates, BWC provides the
employer with the estimated annual premium, a premium installment schedule, and
a certificate of Ohio workers’ compensation coverage for the upcoming policy
payments: A series of premium amounts to be paid at regular intervals.
A statement BWC mails to employers to bill for premium and non-premium charges
that are owed. BWC will use invoices to bill installment payments.
date: Always the first day of a month. BWC will “bill” the employer on the
first day of the month for each installment payment that is due.
G. Grace period:
A time frame during which BWC will not impose a penalty for installment
payments and true-up payroll reports received after established due dates.
A. BWC will
provide a credit to PA and PEC employers as the agency transitions to
prospective billing. See the Transition
Credit policy for complete details.
PA employers will receive a credit of 1/6 of the calculated blended premium for
the policy year beginning July 1, 2015.
PEC employers will receive a credit of fifty percent (50%) of the calculated
blended premium for the policy year beginning January 1, 2016. A PEC employer
must pay the premium invoice by the following due dates:
or before May 15, 2016, no less than fifty percent (50%) of the premium due.
or before September 1, 2016, the total premium due.
will estimate annual premium based on payroll from the most recently completed
policy year. BWC will estimate payroll for employers without a full year of
will allow an employer to revise estimated payroll for the policy year if the
employer can demonstrate “good cause.” Good cause means a substantial reason,
one that affords a legal justification or a legal excuse.
of good cause include, but are not limited to:
Furlough days, layoffs, division closings, and relocations out-of-state.
Combinations and partial transfers.
Significant expansions or reductions in payroll, with supporting
will revise the estimated annual premium and the balance of installments for
the remainder of the policy year to reflect the new estimated payroll.
BWC will not accept requests to revise estimated payroll for the policy
year after the following dates:
PA: Last business day of March of the current policy year.
PEC: Last business day of September of the current policy year.
C. BWC will provide
PA and PEC employers with an annual notice of EAP.
employers will receive the annual notice:
later than May 31, 2015, for the policy year commencing July 1, 2015.
later than the first day of May preceding the policy year for which such
premium is due for all policy years commencing on or after July 1, 2016.
employers will receive the annual notice:
later than the first day of January for the policy year commencing January 1,
later than the last day of October preceding the start of the policy year, for
policy years commencing on or after January 1, 2017.
notice shall include all of the following:
estimated payroll used by BWC to calculate the employer’s estimated premium due.
who have elected coverage.
The classification codes in which the employer’s payroll is segregated
and the blended rates for each of the classifications identified.
employer’s applied EM (experience modifier) used in determining premium due.
employer’s estimated premium due for the applicable policy year.
An installment schedule that outlines installment due dates and installment
D. Operation of
installment payment plans.
will offer employers premium installment options consisting of one, two, four,
six, or twelve payments.
paying the minimum administrative charge are not eligible for an installment
plan. The minimum administrative charge must be paid in full prior to the start
of the policy year.
is no penalty for employers paying in advance of the installment payment
employers with pure premium above the minimum administrative charge will
initially default to a bi-monthly six (6) payment installment plan for the
policy year beginning July 1, 2015.
employer taxing districts with pure premium above the minimum administrative
charge will initially default to a monthly twelve (12) payment installment plan
for the policy year beginning January 1, 2017.
January 1, 2017, BWC will permit PEC employers to defer installment payments
due prior to April 30 of the policy year.
employer must elect to defer payments by the November 15 preceding the
beginning date of the policy year.
will charge an administrative fee equal to the discount rate set by the BWC
Board of Directors times the total dollar amount of the deferred payments.
with the policy year that starts July 1, 2015, for PA employers, and January 1,
2017, for PEC employers, BWC will establish an installment plan for a new
employer if the prorated pure premium for the remainder of the current policy
period is greater than the minimum administrative charge. BWC will not prorate
the minimum administrative charge.
will require the new employer to estimate total payroll for twelve (12) months
and select an installment payment plan on the Application for Ohio Workers’
Compensation Coverage (U-3).
partial policy years, BWC will match, as closely as possible, the installment
plan selected by the employer.
will create an invoice on the bill date for each installment payment that is
payment due dates.
installment payment due dates.
PA employers: By the June 30 preceding the policy year, i.e.
twenty-nine (29) days after the June 1 bill date.
PEC employers: By the December 31 preceding the policy year, i.e.,
thirty (30) days after the December 1 bill date.
If either of the above due dates falls on a weekend or holiday, the
first installment payment due date will be the next business day.
subsequent installment payment due dates: Thirty (30) days after the first of
the month bill date, unless such date falls on a weekend or holiday. In such
case the installment payment due date will be the next business day after the
weekend or holiday.
E. Changes in
installment payment plans.
private employer may change its installment payment plan by logging on to its
account on www.bwc.ohio.gov, and making
the change, by the following deadlines:
the policy year beginning July 1, 2015, the deadline is July 15, 2015.
policy years beginning on or after July 1, 2016, the deadline is the May 15
preceding the beginning date of the policy year.
policy years beginning on or after January 1, 2017, a public employer taxing
district may change its installment plan by logging on to its account on www.bwc.ohio.gov, and making the change, by the
November 15 preceding the beginning date of the policy year.
employer requesting a change to its installment payment plan after the
deadlines set forth above must contact BWC.
will not consider changes to installment payment plans after the following
employers: Last business day of March of the current policy year.
employers: Last business day of September of the current policy year.
may alter an installment payment plan if it determines such change is
F. Default in
employer paying an installment after the due date, but prior to the expiration
of any grace period, will not have its coverage lapsed. The payment must be
posted to the employer’s account prior to the expiration of the grace period.
employer paying an installment after the grace period will have its coverage
lapsed. Such lapse will be effective the first day of the month following the
bill date, regardless if such date occurs prior to the installment due date.
new employer that fails to pay its initial installment payment before the
expiration of any grace period will have its coverage lapsed back to the
initial date of coverage.
will assess penalties for installment payments made after the grace period.
Penalties will be assessed at the interest rate established by the state tax
will certify installment payments to the Ohio Attorney General seventy-five
(75) days after the payroll true-up due date. See the Payroll
True-Up policy for additional information.
G. Combinations and
will recalculate an employer’s EAP when it becomes the successor in a combination.
successor employer’s estimated payroll and remaining installment payments will
be adjusted for the remainder of the policy year.
will transfer the experience of the predecessor to the successor effective the
beginning date of the following policy year.
H. Resolution of
has not identified any extenuating circumstances that apply to installment
complaints related to installment payment plans should be processed under the General
Employer Complaint Policy.
complaints related to the default of an installment payment should be processed
under the Retroactive
Coverage and Penalty Abatement policy.