OhioBWC - Employer - Service: Experience period data

OhioBWC - Employer - Service: Experience period data

Experience period data

This service offering encompasses nine different screens, showing information such as premium rate calculations, experience modifier calculations, payroll and claims data, and an administrative cost breakdown. The rates are displayed per manual classification and any participating rating plans and/or discount plans. Additionally, you can view and/or download the rate letter and accompanying experience exhibit you receive each year.

Below you'll find some additional information, including definitions to help you better use this service offering. Click on the link below that corresponds to the details you want.
Rating period
Experience exhibit
Calculation of premium rates
Calculation of experience modifier (EM)
Experience period claims data
Experience period payroll
Administrative cost breakdown

How does BWC calcuate my insurance rate?

Experience-rated employer - an employer expected to have $2,000 or more in expected losses
Experience modification - applied as the result of a credit for an employer with a better than average loss experience (credit rating) or a penalty for an employer with a poor loss experience (penalty rating)

Rating period
On this screen you can view the your experience modifier, rating plan and program information for a period you select. If you're participating in a rating plan and/or program, you'll see a message at the bottom of the screen with the name of the plan or program and the accompanying discount.
Note: Beginning July 1, 2009, you'll be able to see whether or not your policy qualifies for the experience modifier cap.

Summary of an experience exhibit
An employer's experience is a statistical snapshot of claims costs and payroll for the oldest four of the most recent five-year period. BWC generates rate letters and experience exhibits for state-fund employers in July and for public employer taxing districts in January. The experience exhibit:

Shows all lost-time claims within the experience period, including compensation awards, medical payments and claim reserves;
Lists the base rates for each manual classification;
Shows any experience modification e.g., the percentage applied to the base rate used to determine premium.

Experience exhibit definitions

Rating year - the year where the first effective date of the merit period falls.
Example: For private employers, the merit period is July 1, 2009, through June 30, 2010. The rating year is 2009. For public employers, the merit period is Jan. 1 through Dec. 31. The rating year is 2010.
Experience period - the oldest four of the most recent five-year period
Merit periods - Private employers' merit period is July 1 through June 30 and public employers' is Jan. 1 through Dec. 31.
As of survey date - The month, day and year BWC took the snapshot of the experience data
Individual experience calculation (non-group employers)

Total modified losses (TML) - Total claims costs for the experience period as of the survey date. A private employer's snapshot date is Dec. 31 for the year prior to the rating year. A public employer's snapshot date was Sept. 30 for years 2002 through 2005 and is now June 30 for the year prior to the rating year.
Note: If a single claim in the experience period has costs that exceed the maximum value, we only include the claim costs up to the maximum in the TML. That's why the claims costs are referred to as modified losses.
Total limited losses (TLL) - Reflects the claims costs we expect for you, based on size and industry, to incur during the four-year experience period
Ratio (TML-TLL)/TLL - The TLL (what an employer is expected to incur) is compared to the TML (what the employer actually incurred) and the difference is divided by the TLL which produces a ratio indicating how much better or worse an employer is than average.
Credibility percentage - Factor used in the experience modification calculation to separate random occurrences from true expectations. Once we determine your total expected losses (TEL), we assign a credibility percentage based on the amount of your TEL. This also determines the maximum value per claim for which you are responsible. The larger the employer, the easier it is for the employer to absorb the effects of a high-cost claim. However, a small employer who experiences a high-cost claim cannot absorb the costs easily. An employer's size determines its credibility factor. The larger the employer is, the higher the credibility percentage. The ratio multiplied by the credibility percentage equals the total modifier (TM).
Uncapped EM - The calculated experience modifier not limited by the cap. EM capping started in policy year 2009 for private employers.
EM for rates - The EM we use to set your rates. It's possible for individual employers to have more than one EM calculation, a calculated EM and a capped EM. The EM for rates will be the lower of the two.

EM cap calculation (for non-group employers)

(A) Current year published EM - Calculated EM for the current year
(B) Previous year published EM - Calculated EM for the previous year
(C) Previous year EM with cap - If current EM (A) is above 1.01, a non-group employer qualifies for the 100 percent cap. The capped EM calculation is an employer's previous EM (B) doubled.
Lower of A & C - the lower number of the current published EM and capped EM. This is the same as the EM for rates.

Group-experience calculation

Rating plan - Identifies the rating plan in which you are enrolled. The rating plans are experience rated (EXP), base rated (BASE), group rated (GROUP), group-retro rated (GROUP RETRO).
Group code - Code we use to determine under what group you are filed.
Group EM - Calculated EM for the group under which you are filed
Individual EM (if not in group) - Individual calculated EM for the current year

Calculation of premium rates (individual or group)

Manual number - Industry classification number assigned to you
Base rate - Base rate for the manual number for that rating period. This is the basic rate all employers with this manual number pay.
Individual EM (if not in group) - Individual calculated EM for the current year
Group EM (group-experience-rated employers only) - Calculated EM for the group under which you are filed
Group break even factor (group-experience-rated employers only) - a factor we use to calcuate the premium rate for group-experience-rated employers to restore premium rates back to 2008 levels plus a 9.6-percent premium increase due to the change in the credibility table to 77 percent that was approved June 2008.
Modified premium rate - Rate that experience-, group-experience- or individual-retrospective-rated employers pay as a percentage of their payroll. Base rate X experience modifier
Admin cost - This is an employer's portion of the operating costs for BWC and the Industrial Commission of Ohio. All employers are assessed an administrative cost as a percentage of their base or modified premium rate. The Ohio workers' compensation system is paid for completely by employers. No state general revenue funds support the Ohio workers' compensation system.
Disabled Workers' Relief Fund (DWRF) - Supplemental payments to injured workers with dates of injury or disability prior to Jan. 1, 1987, to help with the cost of living We calculate this by multiplying the DWRF rate by the payroll for base-rated or experience-rated employers.
Additional DWRF - Payments to injured workers with dates of injury on or after Jan. 1, 1987. We calcuate this by multiplying the DWRF2 rate by the base-rated premium for base-rated employers and for experience-rated employers.
Deductible Program discount - Discount employers participating in this program receive
Premium rate per $1 of payroll - Rate that appears on the payroll report. It consists of the base rate, modified premium rate or discounted premium rate, the administrative cost, the DWRF and additional DWRF assessments, and Deductible Program discount (after June 30, 2009, if applicable).

Individual experience period payroll

Experience period payroll - Payroll reported for each manual classification for the oldest four of the last five years, as of the survey date.
Expected loss rate per $100 payroll - An average of claims costs determined at the manual class level for the four-year experience period.
Average = Raw losses for the manual from the four-year experience period- Surplus costs/Total period payroll for the manual class
Expected losses - Four-year payroll for each manual classification X Expected loss rate for that manual
Limited loss ratio - Spreads the amount of claim costs above and beyond the individual employer's assigned maximum claim value up to $250,000 across all employers within their industry
Limited losses - Expected losses for each manual are limited or reduced by applying the limited loss ratio our actuarial department determines for each combination of industry group and credibility

Individual experience period losses

Claim number - BWC-assigned number used to identify and track an injured worker's injury
Injured worker name - Name of individual associated with the claim number listed
Injury date - Date the injury or occupational disease occurred
Claim type - Depending on the number of workdays missed, the claim will be coded as lost time (LT) or medical only (MO). MO claims have seven or fewer days missed from work and LT claims have eight or more days missed from work.
Handicap % - a percentage of the claim's costs charged to the statutory surplus fund instead of the employer's experience.
In the event a handicapped employee suffers a lost-time industrial injury/disease and files a workers' compensation claim, you may submit an Application for Handicap Reimbursement (CHP-4A) for consideration. If the application is granted, we will make the appropriate adjustment to your EM calculation.
Unlimited medical paid - Costs we pay for medical services associated with the claim; can be reduced by a handicap award
Unlimited reducible indemnity paid - Compensation costs used within the experience calculation; can be reduced by a handicap award
Unlimited non-reducible indemnity paid - Compensation costs used within the experience calculation that cannot be reduced by a handicap award
Unlimited reserve amount - Estimate of the future costs of the claim used within the experience calculation; can be reduced by a handicap award
Total unlimited claim losses - Total cost of the claim, including all indemnity, medical and reserves
Total modified losses - Total claims costs for the experience period as of the survey date. A private employer's snapshot date is Dec. 31 for the year prior to the rating year. A public employer's snapshot date was Sept. 30 for years 2002 through 2005 and is now June 30 for the year prior to the rating year.

Calculation of premium rates
On this screen you can view details on the calculation of your premium rate for each manual classification assigned to your policy. For rating years prior to 2009, you'll see each element in the premium rate calculation on the Web page. For rating years 2009 and beyond, you'll only see some of the elements. You'll need to click the download button to see all the elements. We'll also show if the experience modifier cap applies to your policy for selected rating period.

Calculation of experience modifier (EM)
This screen shows details on the calculation of your experience modifier. For rating years prior to 2009, you'll see the same data elements whether or not you're in a group-rating plan. If you're looking up calculations for a non-group policy, you'll see the calculation for the individual EM. If searching on a group policy, you'll see the calculation for the group EM.
Note: For rating years 2009 and beyond, there will be two different views depending on whether or not you're in a group-rating plan. For non-group policies, you'll see calculations for the individual EM and whether the EM is capped. If the EM cap applies, you'll see the calculation at the bottom of the screen. For group policies, you'll see calculations for the group EM.

Experience period claims data
This screen allows you to download and view detailed claims information for the period selected.

Group name - Name of the group sponsor
Group code - Number assigned to the group for the policy
TPA - Name of company responsible for management of group-experience-rating plan and designated as the authorized representative of each employer in the group for both policy and claim-related issues
Policy number - BWC-assigned number used to identify and track an employer's policy
Rate period - Reporting period for which you are viewing calculations
Current EM - Most recently calculated experience modifier
Experience claims data

Claim number - BWC-assigned number used to identify and track an injured worker's injury
Injured worker name - Name of individual associated with the claim number listed
Injury date - Date the injury or occupational disease occurred
Claim type - Depending on the number of workdays missed, the claim will be coded as lost time (LT) or medical only (MO). MO claims have seven or fewer days missed from work and LT claims have eight or more days missed from work.
Manual class - Industry number that matches the injured worker's job description
Reserve code - Used to identify a formula for calculating the reserve amount for a claim based upon the latest type of compensation awarded (not paid)
Limited medical paid - Cost BWC pays for medical services associated with the claim; limited to max value; can be reduced by a handicap award
Limited reducible indemnity paid - Compensation costs used within the experience calculation; limited to max value; can be reduced by a handicap award
Limited non-reducible indemnity paid - Compensation costs used within the experience calculation; limited to max value, cannot be reduced by a handicap award
Limited reserve amount - Estimate of the future cost of the claim used within the experience calculation; limited to max value; can be reduced by a handicap award
Total modified losses - Total claims costs for the experience period as of the survey date. A private employer's snapshot date is Dec. 31 for the year prior to the rating year. A public employer's snapshot date was Sept. 30 for years 2002 through 2005 and is now June 30 for the year prior to the rating year.
Unlimited medical paid - Costs we pay for medical services associated with the claim; can be reduced by a handicap award
Unlimited reducible indemnity paid - Compensation costs used within the experience calculation; can be reduced by a handicap award
Unlimited non-reducible indemnity paid - Compensation costs used within the experience calculation that cannot be reduced by a handicap award
Unlimited reserve amount - Estimate of the future costs of the claim used within the experience calculation; can be reduced by a handicap award
Total unlimited claim losses - Total cost of the claim, including all indemnity, medical and reserves
Max value - Maximum amount per claim charged to employer's experience
Handicap percent - a percentage of the claim's costs charged to the statutory surplus fund instead of the employer's experience.
In the event a handicapped employee suffers a lost-time industrial injury/disease and files a workers' compensation claim, you may submit an Application for Handicap Reimbursement (CHP-4A) for consideration. If the application is granted, we will make the appropriate adjustment to your EM calculation.
Subrogation percentage - Subrogation lets BWC recover some claims costs from a liable third party, but not at the expense of the injured worker. When subrogation is successful, you will receive a credit for the claim based on the recovery amount as compared to the total cost of the claim, and we'll make the appropriate adjustment to your EM calculation.

Experience period payroll
On this screen you'll see detailed payroll information for the period selected.

Group name - Name of the group sponsor
Group code - Number assigned to the group for the policy
TPA - Name of company responsible for management of group-experience-rating plan and designated as the authorized representative of each employer in the group for both policy and claim-related issues
Policy number - BWC-assigned number used to identify and track an employer's policy
Rate period - Reporting period for which you are viewing calculations
Current EM - Most recently calculated experience modifier
Total limited losses (TLL) - Reflects the claims costs we expect for you, based on size and industry, to incur during the four-year experience period
Experience period payroll

Manual - An industry classification number used for premium rate making
Payroll reporting period - Six-month period for which you are reporting payroll
Payroll - Reportable wages for an employer's operations

Experience period payroll detail

Manual class - An industry classification number used for premium rate making
Total experience period payroll - Total payroll reported in the four-year experience period used to calculate the experience modifier
Expected loss rate (ELR) - An average of claims costs determined at the manual class level for the four-year experience period
Total expected losses (TEL) - Four-year payroll for each manual classification X Expected loss rate for the manual
Limited loss ratio - Spreads the amount of claim costs above and beyond the individual employer's assigned maximum claim value up to $250,000 across all employers within their industry
Total limited losses (TLL) - Reflects the claims costs we expect for you, based on size and industry, to incur during the four-year experience period

Administrative cost breakdown
This screen will show the administrative cost breakdown for each manual assigned to the policy. We calculate the administrative cost breakdown by multiplying the administrative cost rate by the base-rated premium for base-rated employers or the modified rate premium for experience-rated employers.