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OhioBWC - Basics: (Policy library) - File

 

Policy Name:

Transition Credit

Policy #:

EP-20-03

Code/Rule Reference:

Board of Directors (BOD) Resolution March 25, 2015.

Effective Date:

July 1, 2015

Origin:

Employer Policy

Supersedes:

N/A

History:

Revised June 7, 2016. New policy issued July 15, 2015.

Review Date:

July 1, 2017

 

I.       Policy Purpose

 

The Bureau of Workers’ Compensation (BWC) will provide a premium credit to private employers (PAs) and public employer taxing districts (PECs) as the agency transitions from retroactive to prospective premium billing.

 

II.     Applicability

 

This policy applies to PA and PEC employers, all BWC staff, and authorized representatives.

 

III.    Definitions

Transition Credit: A BWC provided premium credit to ease the transition for employers from a method of paying premium in arrears (retrospective) to one of paying premium before (prospective) coverage is extended.

IV.   Policy

A.     During the conversion from retrospective to prospective billing; BWC will provide a Transition Credit to all eligible employers to prevent the double billing of premiums.

B.     Eligibility criteria.

1.     PA employers must be in an active, reinstated or debtor-in-possession status as of July 1, 2015.

2.     Employers must file all required payroll reports to receive a transition credit.

3.     PEC employers must be in an active, reinstated or debtor-in-possession status as of December 31, 2015.

4.     Ineligible PA Employers:

a.     Employers cancelling coverage on or before August 31, 2015.

b.     Employers billed premium for the reporting period from January 1, 2015, through June 30, 2015, and granted the privilege of Self Insurance on or before to August 31, 2015

5.     Ineligible PEC employers:

a.     Employers that cancel coverage on or before May 15, 2016.

b.     Employers billed premium for the reporting period from January 1, 2015, through December 31, 2015, and granted the privilege of Self Insurance on or before May 15, 2016.

C.    Transition credit calculation. PA employers:

1.     For the period January 1, 2015, through June 30, 2015, one hundred percent (100%) of the calculated blended premium; except for:

a.     Individual retrospective rated employers shall be defined as minimum premium for the reporting period.

b.     Group retrospective rated employers shall be defined as individual, experience rated premium for the reporting period.

c.      Deductible program shall be defined as discounted premium for the reporting period.

d.      Employers reporting zero payroll or reporting more than zero payroll but billed for less than minimum premium, may receive the transition credits for the reporting period,

2.     For the period July 1, 2015, to July 1, 2016, 1/6th of the calculated blended premium; except for:

a.     Individual retrospective rated employers shall be defined as the annual minimum premium for the policy period.

b.     Group retrospective rated employers shall be defined as the annual individual experience rated premium for the policy period.

c.      Deductible program shall be defined as the annual discounted premium for the policy period.

d.     Employers reporting zero payroll or reporting more than zero payroll but billed for less than minimum premium, may receive the transition credits for the estimated annual minimum premium for the policy period.

3.     BWC will not reduce the premium used to calculate the transition credit for bonuses or credits already earned, including, but not limited to Lapse-Free, Go Green, and Safety Council.

4.     BWC will adjust the transition credits related to the July 1, 2015, through June 30, 2016, policy period for PA employers and the January 1, 2016, through December 31, 2016, policy period for PEC employers, based on the reporting of actual payroll for these policy periods.

5.     BWC will make no adjustment to an employer’s transition credit amount for any other reason, including, but not limited to, audits, rate adjustments, and appealed balances.

6.     Prior to coverage premiums are not eligible for Transition Credit.

D.    Transition credit calculation. PEC employers:

1.     For the period January 1, 2015, through December 31, 2015, fifty percent (50%) of the calculated blended premium.

a.     Individual retrospective rated employers shall be defined as minimum premium for the reporting period.

b.     Group retrospective rated employers shall be defined as individual, experience rated premium for the reporting period.

2.     For the period January 1, 2016, through December 31, 2016, fifty percent (50%) of the calculated blended premium.

a.     Individual retrospective rated employers shall be defined as the annual minimum premium for the policy period.

b.     Group retrospective rated employers shall be defined as the annual individual experience rated premium for the policy period.

3.     Premium base shall not be reduced by bonuses/discounts already earned including, but not limited to, Lapse-Free, Go Green, and Safety Council for policy years beginning January 1, 2015, and January 1, 2016.

4.     Eligible employers whose premium is estimated for the January 1, 2015, through December 31, 2015, reporting period will not receive the transition credit until a completed payroll report is received and any associated penalties and interest are paid.

E.     Transition Credit Exceptions:

An employer granted the privilege of self-insurance or an employer who participates in a client relationship with a self-insured PEO effective before March 25, 2014, that elects state fund coverage on or after March 25, 2014, through August 31, 2015, will be required to repay the transition credits if the employer reapplies and is granted the privilege of self-insurance or the employer enters into a client relationship with a self-insured PEO on or before July 1, 2017.

F.     Resolution of complaints.

1.     Employer complaints should be processed under the General Employer Complaint Policy.

2.     BWC has not identified any policy-specific extenuating circumstances that apply to the Transition Credit.

 


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