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This website publishes administrative rules on their effective dates, as designated by the adopting state agencies, colleges, and universities.

Chapter 4123-17 | General Rating for the State Insurance Fund

 
 
 
Rule
Rule 4123-17-01 | Annual rate revision, method of adoption, effective date, publication.
 

(A) Private employers.

(1) The annual revision of premium rates as provided in division (B) of section 4123.34 of the Revised Code applies to all renewals, reinstatements, and new coverage effective on or after July first of each year, unless otherwise specifically provided. The bureau of workers' compensation may adopt such changes in classification of occupations or industries with respect to their degree of hazard as will best serve to determine the risks of the different classes of occupations and will enable the establishing of appropriate premium rates measured by the hazard involved.

(2) The revised premium rates and changes in classification of occupations or industries with respect to their degree of hazard, as provided in paragraph (A)(1) of this rule, will be adopted by rules recommended by the administrator of workers' compensation and with the advice and consent of the bureau of workers' compensation board of directors as provided under division (F) of section 4121.12 of the Revised Code.

(3) The rule, with any revised premium rates and changes in classification of occupations or industries attached thereto, will be filed in accordance with section 111.15 of the Revised Code. Any revised premium rates and changes in classification of occupations or industries become effective on the date indicated on the filed rule.

(B) Public employers, taxing districts.

(1) The annual revision of premium rates for the taxing districts, as provided in section 4123.39 of the Revised Code, applies to all renewals, reinstatements, and new coverage effective on or after January first of each year, unless otherwise specifically provided. The bureau may adopt such changes in classification of occupations or industries with respect to their degree of hazard, as will best serve to determine the risks of the different classes of occupations and will enable the establishing of appropriate premium rates measured by the hazard involved.

(2) The revised premium rates and changes in classification of occupations or industries with respect to their degree of hazard as provided in paragraph (B)(1) of this rule, will be adopted by rules recommended by the administrator and with the advice and consent of the bureau's board of directors as provided under division (F) of section 4121.12 of the Revised Code.

(3) The rule with any revised premium rates and changes in classification of occupations or industries attached thereto, will be filed in accordance with section 111.15 of the Revised Code. Any revised premium rates and changes in classification of occupations or industries become effective on the date indicated on the filed rule.

(C) Public employers, state of Ohio, its agencies and instrumentalities.

(1) The annual revision of contribution rates for the state of Ohio, its agencies and instrumentalities, as provided in section 4123.40 of the Revised Code, for all state agencies is effective July first of each year.

(2) The revised contribution rates as provided in paragraph (C)(1) of this rule will be adopted by rules recommended by the administrator and with the advice and consent of the bureau's board of directors as provided under division (F) of section 4121.12 of the Revised Code.

(3) The rule with the revised contribution rates will be filed in accordance with section 111.15 of the Revised Code. The revised rates become effective on the date indicated on the filed rule.

Last updated July 27, 2023 at 9:07 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29, 4123.32, 4123.34, 4123.39, 4123.40, 4123.411
Five Year Review Date: 6/1/2028
Prior Effective Dates: 8/5/1980, 9/1/1993, 11/22/2004, 8/1/2018
Rule 4123-17-02 | Successorship.
 

(A) Responsibilities.

(1) Whenever one employer succeeds another employer in the operation of a business in whole or in part, the successor shall notify the bureau of workers' compensation of the succession.

(2) Pursuant to this rule, the bureau will provide to the parties to the transfer of experience the necessary forms and instructions to complete the transfer of the appropriate payrolls and claims. The bureau will review the transfer and if any questions arise, the bureau may conduct a premium audit on each party's account.

(3) The successor must preserve the predecessor's payroll records for the five years preceding the date of succession.

(B) Experience.

(1) Where one legal entity, not having coverage in the most recent experience period, wholly succeeds another legal entity in the operation of a business, the successor's rate will be based on the predecessor's experience within the most recent experience period.

(2) Where a legal entity having an established coverage or having had experience in the most recent experience period wholly succeeds one or more legal entities having established coverage or having had experience in the most recent experience period, the experience of all the involved entities will be combined to establish the rate of the successor.

(3) Where a legal entity succeeds in the operation of a portion of a business of one or more legal entities having an established coverage or having had experience in the most recent experience period, the successor's rate will be based on the predecessor's experience within the most recent experience period, pertaining to the portion of the business acquired by the successor.

(4) When any combination or transfer of experience is indicated under any of the provisions of this rule, the effective date of such combination or transfer to the beginning date of the following policy year. In cases where an entity institutes workers' compensation coverage on the same date it wholly succeeds another entity or in cases where the date of succession is determined to be the first date of the policy year, the experience of the predecessor will be transferred to the successor effective as of the actual date of succession.

(5) For an out of state employer purchasing an existing Ohio operation, the bureau may use the out of state experience of the employer as a factor in determining the employer's experience.

(6) In addition to paragraphs (B)(1) to (B)(5) of this rule, and regardless of whether the predecessor's transfer to the successor was voluntary or through an intermediary bank or receivership, the bureau will transfer the predecessor's experience under the workers' compensation law to the successor if any of the following criteria are met:

(a) The successor expressly or impliedly agrees to assume such obligations;

(b) The succession transaction amounts to a de facto consolidation or merger;

(c) The successor is merely a continuation of the predecessor; or

(d) The succession transaction is entered into for the purpose of escaping obligations under the workers' compensation law.

(7) If all of the following conditions are met, the bureau will not transfer the experience from the predecessor to the successor:

(a) There is a material change in ownership;

(b) There is a change in governing classification; and

(c) There is a change in process and hazard.

(8) In addition to paragraph (B)(7) of this rule, the bureau will not transfer the experience from the predecessor to the successor if both of the following are met:

(a) The time between the predecessor ceasing all operations and the effective date of purchase is greater than six months; and

(b) There is no family relationship or other connection between the predecessor and the successor.

(9) The bureau will consider, but is not bound by, language in a purchase agreement between parties regarding non-assumed liabilities when determining experience transfers.

(C) Rights and obligations.

(1) Where one employer wholly succeeds another in the operation of a business, the bureau will transfer the predecessor's rights and obligations under the workers' compensation law to the successor.

(2) In addition to paragraph (C)(1) of this rule and regardless of whether the predecessor's transfer to the successor was voluntary or through an intermediary bank or receivership, the bureau will transfer the predecessor's rights and obligations under the workers' compensation law to the successor if any of the following criteria are met:

(a) The successor expressly or impliedly agrees to assume such obligations;

(b) The succession transaction amounts to a de facto consolidation or merger;

(c) The successor is merely a continuation of the predecessor; or

(d) The succession transaction is entered into for the purpose of escaping obligations under the workers' compensation law.

(3) If all the following conditions are met, the bureau will not transfer the predecessor's rights and obligations to the successor:

(a) There is a material change in ownership;

(b) There is a change in governing classification; and

(c) There is a change in process and hazard.

(4) In addition to paragraph (C)(3) of this rule, the bureau will not transfer the predecessor's rights and obligations to the successor if both of the following are met:

(a) The time between the predecessor ceasing all operations and the effective date of purchase is greater than six months; and

(b) There is no family relationship or other connection between the predecessor and the successor.

(5) The bureau will consider, but is not bound by, language in a purchase agreement between parties regarding non-assumed liabilities when determining rights and obligations transfers.

(6) The successor will be credited with any credits of the predecessor available at the time the bureau completes the transfer. This paragraph applies where an employer wholly succeeds another employer in the operation of a business on or after September 1, 2006.

(D) No retroactive coverage may be granted except as provided in rule 4123-14-03 of the Administrative Code.

Last updated July 27, 2023 at 9:07 AM

Supplemental Information

Authorized By: 4121.13, 4121.30
Amplifies: 4123.32, 4123.34
Five Year Review Date: 6/1/2028
Prior Effective Dates: 1/10/1978, 11/26/1979, 1/1/2004
Rule 4123-17-03 | Employer's experience rating plan.
 

(A) Definitions.

As used in this rule:

(1) "Experience period" means:

(a) For private employer policy years commencing on or after July 1, 2016, the oldest four of the latest five completed policy years immediately preceding the beginning of the policy year to which a rate is applicable.

(b) For public employer taxing districts policy years commencing on or after January 1, 2016, the oldest four of the last five completed calendar years immediately preceding the beginning of the policy year to which the rate is applicable.

(2) "Inactive employer" means an employer that satisfies all the following criteria:

(a) The employer is assigned a "cancelled" policy status or a "no coverage" policy, and

(b) As of the last day of September for private employers, or the last day of March for public employers, the employer is not paying premiums or assessments to the Ohio state insurance fund under either its own identity, the identity of any successor entity, or as a self-insured entity.

(3) "Significant negative impact" occurs when:

(a) An inactive employer reported ten per cent or more of the payroll in a manual classification during the experience period, and

(b) The base rate for the manual classification is higher by including the payroll and losses of such inactive employer in the calculation of that manual classification base rate, than the manual classification base rate is when the payroll and losses of the inactive employer are excluded. For the purpose of determining "significant negative impact," the bureau shall test each inactive employer separately.

(B) An employer's premium rates shall be the manual classification base rates as provided under rules 4123-17-02, 4123-17-06, and 4123-17-34 of the Administrative Code for each of the employer's manual classifications except as modified by the employer's experience rating, and shall apply for the twelve-month period beginning on the first of July for private employers and for the calendar year beginning on the first of January for public employer taxing districts.

(1) In calculating the manual classification base rate and the expected loss rate under this rule, the bureau shall exclude the experience in a manual classification of an inactive employer if the inclusion of that inactive employer's experience in that manual classification would have a significant negative impact upon the remaining employers in a particular manual classification.

(2) The calculation of the manual classification base rate and the expected loss rate, as modified in paragraph (B)(1) of this rule, shall be applied to all employers reporting payroll in the manual classification.

(C) An experience-rated employer's manual classification experience-modified rate shall be determined by multiplying its experience modification (EM) as defined in paragraph (D) of this rule times the manual classification base rate for each of the employer's assigned manual classifications.

(D) An employer's EM is determined in accordance with the following formula:

TML = Actual losses of the employer for the experience period, limited in accordance with paragraph (E)(1) of this rule.

TLL = Total limited losses = TEL multiplied by LLR

TEL = Total expected losses, determined by applying expected loss rate to the payroll of each manual classification in the employer's experience period, as provided in the appendix to rule 4123-17-05.1 of the Administrative Code for private employers and in the appendix to rule 4123-17-33.1 of the Administrative Code for public employer taxing districts. The total expected losses are then used to determine credibility group, credibility, and the maximum value of a loss.

LLR = Limited loss ratio, calculated for each credibility group within each industry group, as provided in appendix B to rule 4123-17-05 of the Administrative Code for private employers and appendix B to rule 4123-17-33 of the Administrative Code for public employer taxing districts.

C = Credibility given to an employer's own experience, determined by the employer's total expected losses, as provided in the appendix to rule 4123-17-05.1 of the Administrative Code for private employers and in the appendix to rule 4123-17-33.1 of the Administrative Code for public employer taxing districts.

(E) For a private employer that is not a professional employer organization as defined in section 4125.01 of the Revised Code, and who is individually experience rated, individually retrospective rated, group retrospective rated, or in a deductible program under rule 4123-17-72 of the Administrative Code, the employer's EM as calculated in paragraph (D) of this rule is further adjusted by multiplying the EM adjustment factor as provided in appendix A to this rule and the employer's EM.

(F) For a public employer taxing district employer that is not a professional employer organization as defined in section 4125.01 of the Revised Code, and who is individually experience rated, individually retrospective rated, group retrospective rated, or in a deductible program under rule 4123-17-72 of the Administrative Code, the employer's EM as calculated in paragraph (D) of this rule is further adjusted by multiplying the EM adjustment factor as provided in appendix B to this rule and the employer's EM.

(G) An employers' EM shall be subject to the following conditions and limitations:

(1) Actual losses shall include all incurred costs but shall be limited as provided in rule 4123-17-12 of the Administrative Code, and at the claim level to the amounts provided in the appendix to rule 4123-17-05.1 of the Administrative Code for private employers and the appendix to rule 4123-17-33.1 of the Administrative Code for public employer taxing districts according to the total expected losses of an employer; and

(2) An employer shall not be eligible for experience modification of manual classification base rates unless its expected losses are at least the minimum amount as provided in the appendix to rule 4123-17-05.1 of the Administrative Code for private employers and the appendix to rule 4123-17-33.1 of the Administrative Code for public employer taxing districts.

(3) The year-over-year increase in an employer's EM may be limited pursuant to rule 4123-17-03.2 of the Administrative Code.

(4) Actual losses where COVID-19 was contracted by an employee arising during the period between the emergency declared by executive order 2020-01D, issued March 9, 2020 and July 2, 2021 which is fourteen days after the Executive Order was repealed, shall be excluded from employer's experience for the purpose of experience rating calculations.

(5) Actual losses occurring on or after March 23, 2022 but before March 23, 2024 where a student is a participant of the work-based learning pilot program shall be excluded from an employer's experience for the purpose of experience rating calculations if both of the following conditions apply:

(a) The employer provides work-based learning experiences for students enrolled in a careertechnical education program approved under section 3317.161 of the Revised Code; and

(b) The claim is based on a student's injury, occupational disease, or death sustained in the course of and arising out of the student's participation in the employer's work-based learning experience.

View AppendixView Appendix

Last updated July 1, 2022 at 1:30 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13
Amplifies: 4121.12, 4121.121, 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/2/1978, 7/1/1983, 7/1/1987, 7/1/1988, 1/1/1992, 9/8/1997, 2/7/2009, 5/21/2009
Rule 4123-17-03.2 | Experience modification cap.
 

(A) Definitions.

As used in this rule:

(1) "Experience modification" or "EM" means the experience modification as determined under rule 4123-17-03 of the Administrative Code.

(2) "Eligibility determination date" means the March first immediately preceding the policy year for which the EM is being calculated for private employers, and the September first immediately preceding the policy year for which the EM is being calculated for public employer taxing districts.

(3) "Safety requirement completion date" means the last business day of March for private employers and the last business day of September for public employer taxing districts.

(B) Except as provided for in paragraph (D) of this rule, the bureau shall limit the increase in EM of an employer meeting the eligibility requirements of this rule to hundred per cent of the initial EM calculated for that employer in the preceding rating year.

(1) Twenty-five per cent of the initial EM calculated for that employer in the preceding rating year if the employer is either individually experience rated or base rated in both the current and preceding rating years for any policy years for private employers beginning July 1, 2023 and ending June 30, 2027 or for any policy years for public employer taxing districts beginning January 1, 2023 and ending December 31, 2027, and

(2) One hundred per cent of the initial EM calculated for that employer in the preceding rating year for all other employers.

(C) Eligibility requirements.

(1) As of the eligibility determination date:

(a) The employer must be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code; and

(b) The employer must not have cumulative lapses in workers' compensation coverage in excess of forty days within the preceding twelve months.

(2) To be eligible for the one hundred per cent cap, an employer must annually complete a safety program prescribed by the division of safety and hygiene no later than safety requirement completion date during each policy year in which the cap applies. If the employer fails to comply with these requirements, the bureau will remove the cap for the policy year in which the requirements were not met and use employer's uncapped EM for that policy year.

(3) An employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later eligibility determination date.

(D) An employer removed from the EM cap program for failure to meet the criteria set forth in paragraph (C)(3) of this rule will be rerated for the full policy year at the employer's base rate or experience-modified rate as determined by the employer's expected losses for the policy year.

(E) Opt-out provision.

The bureau will automatically apply the cap to an employer that meets the eligibility requirements of paragraphs (C)(1)(a) and (C)(1)(b) of this rule. An employer may voluntarily withdraw from the EM cap program by providing written notice to the bureau.

(F) Application of cap to successor policies.

(1) Where a transfer of experience occurs pursuant to rule 4123-17-02 of the Administrative Code, the resulting EM is not subject to limitation under this rule unless one of the following apply:

(a) The transfer is a combination as a result of bankruptcy proceedings, when the transaction is a change in policy number without any change in exposure; or

(b) A base-rated successor wholly or partially succeeds a single policy.

(2) If the criteria in paragraph (F)(1)(a) or (F)(1)(b) of this rule are met, the predecessor's published EM in the preceding rating year will be the EM published for the successor in the same rating year for purposes of determining whether the cap applies under this rule.

Last updated July 1, 2022 at 1:30 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13
Amplifies: 4121.12, 4121.121, 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/2014, 7/1/2016
Rule 4123-17-03.3 | Employer premium size factors.
 

(A) The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, hereby sets the premium size factors in the appendix to this rule to be effective July 1, 2019.

(B) A private employer is eligible for the premium adjustment under this rule provided the private employer is not a professional employer organization as defined in section 4125.01 of the Revised Code, and the private employer is individually experience rated, individually retrospective rated, group retrospective rated, or participating in a deductible program under rule 4123-17-72 of the Administrative Code.

(C) The premium size factors in the appendix to this rule will be applied using the following formula to determine an employer's initial premium:

Initial premium equals payroll multiplied by base rate multiplied by EM multiplied by EM adjustment factor where:

Payroll equals the amount of payroll reported by the employer as required under agency 4123 of the Administrative Code;

Base rate equals the rate that an employer who is not experience rated pays as a percentage of their payroll;

EM equals experience modification as defined in rule 4123-17-03 of the Administrative Code; and

EM adjustment factor equals experience modification adjustment factor as defined in rule 4123-17-03 of the Administrative Code.

(D) The following limitations apply to the initial premium calculated in paragraph (C) of this rule:

(1) For an employer that is individually experience rated, group retrospectively rated, or participating in a deductible program under rule 4123-17-72 of the Administrative Code, the initial premium is adjusted by the following formula:

Premium equals initial premium multiplied by premium size factor where:

Initial premium equals initial premium as calculated in paragraph (C) of this rule; and

Premium size factor equals the appropriate premium size factor obtained from the table in the appendix to this rule when applying the initial premium as calculated in paragraph (C) of this rule to the experience rated premium range.

(2) For individual retrospective rated employers, the premium size factors will only apply to the minimum premium and not to any payments on annual evaluation billings made by the employer.

(3) For employers participating in the deductible program, the premium size factors will only apply to the post deductible credited premium and not to any deductible claim cost reimbursement payments made by the employer.

View Appendix

Last updated May 31, 2023 at 11:58 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13
Amplifies: 4121.12, 4121.121, 4123.29, 4123.34
Five Year Review Date:
Rule 4123-17-04 | Classification of occupations or industries.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve the classification of occupations or industries pursuant to sections 4121.12, 4121.121, and 4123.29 of the Revised Code. The administrator hereby establishes the following classifications of occupations or industries to be effective July 1, 2020, as indicated in appendix A to this rule, the classification of occupations or industries that is based upon the national council on compensation insurance as required by division (A)(1) of section 4123.29 of the Revised Code.

View Appendix

Supplemental Information

Authorized By: 4121.11, 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 7/1/1992, 7/1/1993, 7/1/1995, 7/1/1997, 7/1/2000, 7/1/2006, 7/1/2007, 7/1/2010, 7/12/2012, 7/1/2015, 7/1/2017, 7/1/2019
Rule 4123-17-05 | Private employer industry group and limited loss ratio tables.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to sections 4121.121, 4123.29, and 4123.34 of the Revised Code. The administrator hereby sets the industry group assignment and limited loss ratio tables parts A and B, to be effective July 1, 2023, applicable to the payroll reporting period July 1, 2023, through June 30, 2024, for private employers as indicated in appendices A and B to this rule.

View AppendixView Appendix

Last updated July 27, 2023 at 8:38 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1995, 7/1/1998, 7/1/1999, 7/1/2000, 7/1/2002, 7/1/2003, 7/1/2004, 7/1/2007, 7/1/2011, 7/1/2015, 7/1/2017, 7/1/2018, 7/1/2020, 7/1/2021, 7/1/2022
Rule 4123-17-05.1 | Private employer credibility table.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to sections 4121.121, 4123.29, and 4123.34 of the Revised Code. The administrator hereby sets the experience rating table part A, "credibility and maximum value of a loss," to be effective July 1, 2019, applicable to the payroll reporting period July 1, 2019 through June 30, 2020, for private employers as indicated in appendix A to this rule.

View Appendix

Last updated March 16, 2023 at 10:30 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1995, 7/1/1996, 7/1/1999, 7/1/2002, 7/1/2003, 7/1/2004, 7/1/2006, 7/1/2007, 7/1/2008, 7/1/2010, 7/1/2012
Rule 4123-17-06 | Private employer contributions to the state insurance fund.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to sections 4121.121, 4123.29, and 4123.34 of the Revised Code. The administrator hereby sets the private employer class code base rates, and private employer class code expected loss rates per one hundred dollar unit of payroll to be effective July 1, 2023, applicable to the payroll reporting period July 1, 2023, through June 30, 2024, for private employers as indicated in appendices A and B to this rule.

View AppendixView Appendix

Last updated July 27, 2023 at 8:39 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1991 (Emer.), 7/1/1993, 7/1/1994, 7/1/1998, 7/1/1999, 7/1/2002, 7/1/2003, 7/1/2006, 7/1/2008, 7/1/2009, 7/1/2010, 7/1/2011, 7/1/2013, 7/1/2020, 7/1/2021, 7/1/2022
Rule 4123-17-07 | Officers of corporations, elective coverage entities, and ministers.
 

(A) Definitions.

As used in this rule:

(1) "Church" means an established and legally recognized church, congregation, denomination, society, corporation, fellowship, convention, or association that is formed primarily or exclusively for religious purposes.

(2) "Elective coverage persons" means a sole proprietor, a member of a partnership, a member of a limited partnership, an individual incorporated as a corporation with no employees, or an officer of a family farm corporation.

(3) "Elective coverage entity" means a sole proprietorship, a partnership, a limited partnership, an individual incorporated as a corporation with no employees, or a family farm corporation.

(4) "Family farm corporation" has the same meaning as defined in division (E) of section 4123.01 of the Revised Code.

(5) "Minister" means a duly ordained, commissioned, accredited, or licensed minister, member of the clergy, rabbi, priest, or Christian science practitioner.

(B) Officers of corporations.

(1) The actual remuneration of an executive officer of a corporation, such as president, vice president, secretary, treasurer, and any other executive officer enumerated in and empowered by the corporate charter or any regularly adopted bylaws of the corporation and elected or appointed and empowered by the directors to perform duties for the corporation, shall be included in the payroll report of the corporation pursuant to rule 4123-17-14 of the Administrative Code, subject to the weekly minimum and maximum provided in rule 4123-17-30 of the Administrative Code. Such remuneration is to be assigned to the classification code applicable to the duties performed.

(2) Paragraph (B)(1) of this rule does not apply to family farm corporations. The remuneration of the officers of such corporation will not be reported as part of the payroll of such employer, unless such employer elects to include as an "employee," within Chapter 4123. of the Revised Code, any officer of the family farm corporation, in which case the procedure outlined in paragraph (C) of this rule applies.

(C) Elective coverage entities.

(1) Remuneration of an elective coverage person shall not be reported as part of the payroll of an elective coverage entity unless that entity elects to include any such person as an employee.

(2) Upon the filing of notice pursuant to paragraph (E) of this rule, the actual remuneration of an elective coverage person shall be reported and included in the payroll report of the employer pursuant to rule 4123-17-14 of the Administrative Code, subject to the weekly minimum and maximum provided in rule 4123-17-30 of the Administrative Code. Such remuneration is to be assigned to the highest rated classification code applicable to the duties performed.

(D) Ministers.

(1) Division (A)(2)(a) of section 4123.01 of the Revised Code excludes from coverage ministers, assistant ministers, or associate ministers in the exercise of their ministry. The remuneration for such persons shall not be reported as part of the payroll of a church employer, unless the church elects to include such persons as employees.

(2) Upon the filing of notice pursuant to paragraph (E) of this rule, the actual remuneration of a minister, assistant minister, or associate minister shall be reported and included in the payroll report of the employer. Such remuneration is to be assigned to the classification code applicable to the duties performed.

(E) An employer may elect to include an elective coverage person or minister, assistant minister, or associate minister as an employee under paragraph (C) or (D) of this rule by notifying the bureau of workers' compensation on a form prescribed by the bureau. After proper election notice, and payment of premium, elective coverage persons or ministers, assistant ministers, or associate ministers will be entitled to receive compensation and benefits as provided in Chapter 4123. of the Revised Code.

(1) Coverage for such persons will not be effective until notice has been filed and the mandatory payment made with the bureau.

(2) Coverage will remain in effect, and the employer will be responsible for the payment of estimated premium thereon, until the bureau receives written notice from the employer requesting termination of coverage for the elective coverage persons or ministers, assistant ministers, or associate ministers.

(3) An employer's failure to pay estimated premiums timely will terminate or lapse coverage for its elective coverage persons or ministers, assistant ministers, or associate ministers in accordance with bureau policy. Reinstatement of coverage will also be determined in accordance with bureau policy. No retroactive coverage may be granted except as provided in rule 4123-14-03 of the Administrative Code.

(F) Household workers.

Coverage that is extended to a person who, in his or her household, employs household worker(s) pursuant to section 4123.01 of the Revised Code, does not include such person himself.

Last updated July 27, 2023 at 9:07 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30, 4123.05
Amplifies: 4123.01, 4123.24, 4123.26, 4123.34
Five Year Review Date: 6/1/2028
Prior Effective Dates: 7/1/1962, 12/1/1978, 8/1/2018
Rule 4123-17-08 | Classifications according to national council on compensation insurance.
 

In accordance with division (A)(1) of section 4123.29 of the Revised Code, the purpose of this rule is for the bureau of workers' compensation to conform the classifications of industries according to the categories the national council on compensation insurance (NCCI) establishes that are applicable to employers in Ohio. This rule is based upon "Rule 1, Classification Assignment," effective January 1, 2002, of the classification rules of the NCCI and "Rule 2G, Interchange of Labor." The rule is used with the permission of the NCCI and is modified to conform to the requirements of the Ohio administrative code and the bureau of workers' compensation. Where the NCCI scopes of basic manual classifications contains additional rules and information relating to the reporting of payroll or classification of industries under the manual classifications, such scopes and rules shall apply under the rules of the bureau of workers' compensation, unless otherwise specifically excepted.

(A) Classification system.

(1) The purpose of the classification system is to group employers with similar operations into classifications so that:

(a) The assigned classification reflects the exposures common to those employers.

(b) The rate charged reflects the exposure to loss common to those employers.

(2) Subject to certain exceptions, it is the business of the employer within a state that is classified, not separate employments, occupations or operations within the business.

(B) Explanation of classifications.

Classifications are divided into two types - basic classifications and standard exception classifications.

(1) Basic classifications.

Basic classifications describe the business of an employer. This term is applied to all classifications listed in this manual, except for the standard exception classifications.

Examples of classifications that describe the business of the employer include:

(a) Business: manufacture of a product = classification: furniture manufacturing.

(b) Business: a process = classification: engraving.

(c) Business: construction or erection = classification: carpentry.

(d) Business: a mercantile business = classification: hardware store.

(e) Business: a service = classification: beauty salon.

(2) Standard exception classifications.

Standard exception classifications describe occupations that are common to many businesses. These common occupations are not included in a basic classification unless specified in the classification working. The standard exception classifications are described as follows:

(a) Clerical office or drafting employees NOC (code 8810); clerical office or drafting telecommuter employees (code 8871).

The noted classifications are assigned when all the following conditions are met: the basic classification(s) wording applicable to the business does not include clerical office, drafting or telecommuting employees; other rules do not prohibit the assignment of code 8810 or code 8871; and the employee meets the duties, site and other requirements listed as follows:

(i) Duties.

Duties must be limited to one or more of the following work activities:

(a) Creation or maintenance of employer records, correspondence, computer programs, files.

(b) Drafting.

(c) Telephone duties, including telephone sales.

(d) Data entry or word processing.

(e) Copy or fax machine operations, unless the insured is in the business of making copies or faxing for the public.

(f) General office work similar in nature to those noted in this paragraph.

(ii) Site.

(a) Code 8810 - the noted duties must take place in a work station that is separated from the operative hazards of:

(i) Factories.

(ii) Stores;

(iii) Shops;

(iv) Construction sites;

(v) Warehouses;

(vi) Yards;

(vii) Any other work areas such as:

(A) Work or service areas.

(B) Areas where inventory is located.

(C) Areas where products are displayed for sale.

(D) Areas to which the purchaser customarily brings the product from another area for payment.

(b) Work stations or service areas as described in paragraph (B)(2)(a)(ii)(a) of this rule must be physically separated by:

(i) Floors.

(ii) Walls.

(iii) Partitions.

(iv) Counters.

(v) Other physical barriers that protect the clerical employee from the operating hazards of a business.

(c) Code 8871 - the noted duties must take place in a clerical work area located within the home of the clerical employee. It must be separate and distinct from the location of the employer.

(iii) Other requirements.

(a) Employees who otherwise meet the requirements for code 8810 or code 8871 will not be disqualified from assignment to this classification if they perform certain incidental duties directly related to that employee's duties in the office. These duties include:

(i) Depositing of funds in a bank.

(ii) Pickup or delivery of mail.

(iii) Purchase of office supplies.

(iv) Entering an area exposed to the operative hazards of the business for clerical purposes, such as delivering paychecks.

(b) Employees who otherwise meet the requirements for code 8810 or code 8871 will be disqualified from assignment to this classification if their duties involve:

(i) Outside sales or outside representatives.

(ii) Direct supervision of nonclerical employees not performed in an eligible site according to paragraph (B)(2)(a)(ii)(a) of this rule.

(iii) Physical labor.

(iv) Any work exposed to the operative hazards of the business, such as a stock or tally clerk, that is necessary, incidental, or related to any operations of the business other than a clerical office.

(b) Drivers, chauffeurs and their helpers NOC - commercial (code 7380).

This classification is assigned to employees who perform work on or in connection with a vehicle. This code includes garage employees and employees using bicycles as part of their work duties. Duties include, but are not limited to, delivering goods owned by the employer.

Code 7380 does not apply when the basic classification wording includes drivers.

(c) Salespersons, collectors or messengers - outside (code 8742).

This classification is assigned to employees who perform these duties away from the employer's premises.

This code excludes employees who:

(i) Deliver merchandise.

(ii) Use vehicles to deliver or pick up goods, even if they collect or sell. These employees must be assigned to the classification applicable to the business for drivers.

(iii) Use public transportation or walk to deliver goods, even if they collect or sell. These employees must be assigned to the governing classification applicable to the business.

Code 8742 does not apply when the basic classification wording includes outside salespersons, collectors or messengers.

(d) Automotive salespersons (code 8748).

This classification is assigned to employees who perform these duties on or away from the employer's premises. These employees are subject to the same rules and treatment as salespersons, collectors, or messengers - outside.

(3) General inclusions.

Some operations appear to be separate businesses but are included within all basic classifications. These are called general inclusions. These operations are not separately classified. They include the following:

(a) Restaurants or cafeterias operated by the insured for employee use. Exception: if these operations are conducted in connection with construction, erection, lumbering or mining operations, they must be separately classified.

(b) Manufacture of containers by the insured, such as bags, barrels, bottles, boxes, cans, cartons or packing cases for sole use in the operations insured by the policy.

(c) Hospitals or medical facilities operated by the insured for its employees.

(d) Maintenance or repair of the insured's buildings or equipment by the insured's employees.

(e) Printing or lithographing by the insured on its own products.

Some employees may perform general inclusion duties for more than one basic classification. In such cases, refer to paragraph (F) of this rule for classification treatment.

Exceptions:

A general inclusion operation must be separately classified if:

(i) The operation is conducted as a separate and distinct business of the insured (refer to paragraph (D)(3) of this rule.)

(ii) The operation is specifically excluded in the wording of the basic classification.

(iii) The principal business is described by a standard exception classification.

(4) General exclusions.

Some operations in a business are so unusual for the type of business described by the applicable basic classification, that they are separately classified even though the operations are not conducted as a secondary business. These are called general exclusions. They are:

(a) Aircraft operations - all operations of the flying and ground crews.

(b) New construction or alterations.

(c) Stevedoring.

(d) Sawmill operations.

(e) Employer-operated day care service.

(5) Governing classification.

The governing classification at a specific job or location is the classification, other than a standard exception classification, that produces the greatest amount of payroll.

If a basic classification is not applicable, the governing classification is the standard exception classification that produces the greatest amount of payroll.

The governing classification is used to determine the classification treatment of:

(a) Miscellaneous employees.

(b) Local managers.

(c) Executive officers who regularly engage in duties that are ordinarily performed by a superintendent, foreperson or worker.

Example of a governing classification: a business has the following payroll amounts assigned to the following classifications: $220,000 for code 2003 (bakery); $120,000 for code 8017 (store; retail); and $240,000 for code 8810 (clerical).

The governing code for this business is code 2003 because it is the classification code, other than the standard exception code (code 8810), with the greatest amount of payroll.

(6) Principal business.

Principal business is described by the classification, other than a standard exception or general exclusion, with the greatest amount of payroll.

If the business is best described by a standard exception operation, and there is no basic classification other than the general inclusion or exclusion operations, then the standard exception operation that produces the greatest amount of payroll for the business is considered the principal business.

(C) Classification wording.

The following list provides an explanation of classification wording usage.

(1) Classification captions and notes.

The "caption" is the heading that precedes the classification itself and is part of the classification wording.

The "note" is the phrase that follows the classification and is part of the classification wording.

The classification wording, including captions and notes, controls, restricts or explains the classification usage.

Example of a classification entry:

Store: fruit or vegetable - retail. No handling of fresh meats; "store" is the caption in the example and "no handling of fresh meats" is the note.

(2) Words and phrases.

(a) All employees, all other employees, all operations, or all operations to completion.

If a classification includes any of these phrases, no other classification can be assigned unless noted in the classification wording. This applies even if some operations or employees are at a separate location.

Examples of classifications that include "all employees," "all other employees," all operations," or "all operations to completion":

(i) Code 9186 (carnival, circus or amusement device operator - traveling - all employees & drivers); all employees must be assigned to this classification.

(ii) Code 7382 (bus co.: all other employees & drivers); all employees, other than garage employees, must be assigned to code 7382, not 8385;

(iii) Code 5402 (greenhouse erection-all operations); all work for the erection of a greenhouse must be assigned to this classification.

(iv) Code 6005 (jetty or breakwater construction-all operations to completion & drivers); all work for the construction of a jetty from the beginning to the end of the project must be assigned to this classification.

Exceptions:

The following operations within the business must be classified separately even if the classification wording includes "all employees," "all other employees," "all operations," or "all operations to completion":

(a) Construction or erection permanent yard (code 8227).

(b) Contractor - executive supervisor or construction superintendent (code 5606).

(c) Classifications describing an operation that is a standard exception unless the basic classification includes the standard exception operation.

(d) Classifications describing an operation that is a general exclusion.

(e) Any separate and distinct business (refer to paragraph (D)(3)(c) of this rule).

(b) Clerical.

Clerical means clerical office employees and drafting employees as defined in paragraph (B)(2)(a) of this rule.

Clerical includes clerical telecommuters as defined in paragraph (B)(2)(a) of this rule.

(c) Drivers.

Drivers means drivers, chauffeurs, and their helpers as defined in paragraph (B)(2)(b) of this rule.

(d) "Includes" or "&."

If the classification wording uses the terms "includes" or "&," the operation or employees cited after those terms must not be assigned to a separate classification. This applies even though the operation or employees may be described by another classification or are at a separate location.

Examples of classification that include the terms "includes" or "&":

(i) Code 0005 (farm: nursery employees & drivers); all drivers must be assigned to this classification.

(ii) Code 4829 (chemical mfg. NOC - all operations & drivers - includes blending or mixing); all drivers and all blending and mixing operations must be assigned to this classification.

(iii) Code 8832 (physician & clerical); all clerical employees must be included in this classification.

Note: if an insured's operations are assigned to more than one basic classification, an employee's payroll may be allocated among codes appropriate for each operation. This procedure is provided under paragraph (F) of this rule, interchange of labor.

(e) Local manager.

Local manager is an employee, regardless of title, who is in direct charge of the operative procedures in the yard of a business. This employee is subject to the hazards of the business. Therefore, the payroll of the local manager must be assigned to the governing classification unless another basic classification assigned to the business specifically includes this employee.

(f) "No" or "Not."

A classification that includes a restrictive phrase beginning with "no" or "not" must not apply to any risk that conducts any operation described in the restrictive phrase.

Examples of classifications that include the terms "no" or "not":

(i) Code 2143 (fruit juice mfg.-no bottling of carbonated liquids); this code cannot be assigned to a business that manufactures fruit juice if it also bottles carbonated liquids.

(ii) Code 4611 (drug, medicine or pharmaceutical preparation-no mfg. of ingredients); this code cannot be assigned to a business preparing drugs, medicines, or pharmaceuticals if the business also manufactures the ingredients.

(iii) Code 8106 (steel merchant-not applicable to junk dealers); this code cannot be assigned to a steel merchant if that business also deals in junk.

Exception: for mercantile, mining or construction operations, this rule applies to each job or location.

(g) "NOC."

"NOC" means "not otherwise classified." If the classification wording uses the term "NOC", that classification applies only if no other classification more specifically describes the insured's business.

Examples of classification that include the term "NOC":

(i) Code 2688 (leather goods mfg. NOC).

(ii) Code 3022 (pipe or tube mfg. NOC & drivers).

(iii) Code 8017 (store: retail NOC).

None of the listed codes will be assigned to a business if there is another code that more specifically and accurately applies to that business.

(h) "Or" or "And."

The terms "or" or "and" mean and/or.

Examples of classifications that include the term "or" or "and":

(i) Code 2586 (cleaning or dyeing); a business that does cleaning and/or dyeing is classified to this code.

(ii) Code 4720 (soap or synthetic detergent mfg.); a business that manufactures soap and/or synthetic detergents is classified to this code.

(iii) Code 7600 (Telecommunications Co. - cable TV/satellite - all employees and drivers); a business that installs overhead telephone and/or cable TV lines is classified to this code.

(i) Salespersons.

Salespersons means salespersons, collectors, and messengers as defined in paragraph (B)(2)(c) of this rule.

(j) Stories in height.

Certain classification wording refers to "stories in height." A story is defined as fifteen feet in height. It is measured from the lowest point above ground level to the highest point above ground level. Some of these classifications are:

(i) Code 5037 (painting: metal structures - over two stories).

(ii) Code 5059 (iron or steel-erection-frame structures not over two stories).

(k) To be separately rated.

Certain classification wording contains the phrase "to be separately rated." Operations or employees referenced in those classifications must be separately classified.

Examples of classifications that include the term "to be separately rated":

(i) Code 2111 (cannery NOC can mfg. to be separately rated as code 3220); in a business that cans foods, the manufacturing of the cans must separately classified to code 3220.

(ii) Code 4131 (mirror mfg.-mfg. of glass, frames, backs, or handles to be separately rated); in a business that makes mirrors, the work of producing glass, or fabricating frames, backs, or handles must be separately classified.

(iii) Code 8107 (machinery dealer NOC-store or yard & drivers, operations away from premises, other than demonstration or repair, to be separately rated); in a business that is a machinery dealer, work other than demonstrating or repairing the equipment that is not done at the insured's location must be separately classified.

Rules regarding the assignment of more than one basic classification apply. Refer to paragraph (D)(3) of this rule.

(D) Classification procedures.

The purpose of the classification procedure is to assign the one basic classification that best describes the business of the employer within a state. Subject to certain exceptions described in this rule, each classification includes all the various types of labor found in a business.

It is the business that is classified, not the individual employments, occupations or operations within the business.

Certain exceptions apply as noted:

(1) Separate legal entities.

Classification rules apply separately to each legal entity operating in a state even if multiple entities are insured under a single policy.

(2) Businesses not described by a classification.

If no basic classification clearly describes the business, the classification that most closely describes the business must be assigned. All the rules pertaining to the assigned basic classification apply to this operation.

(3) Assignment of more than one basic classification.

More than one basic classification may be assigned to an insured who meets conditions set forth in paragraphs (D)(3)(a) to (D)(3)(c) of this rule. Operation means activities, enterprises, processes, secondary businesses or undertakings.

(a) The insured's principal business is described by a basic classification that requires certain operations or employees to be separately rated.

(b) The insured conducts one or more of the following operations:

(i) Construction or erection.

(ii) Farming.

(iii) Employee leasing, labor contracting, temporary labor services.

(iv) Mercantile business.

(c) The insured conducts more than one operation in a state.

(i) For purposes of this rule, an insured is conducting more than one operation in a state if portions of the insured's operations in that state are not encompassed by the classification applicable to the insured's principal business. To qualify for a separate classification, the insured's additional operation must:

(a) Be able to exist as a separate business if the insured's principal business in the state ceased to exist.

(b) Be located in a separate building, or on a separate floor in the same building, or on the same floor physically separated from the principal business by structural partitions. Employees engaged in the principal business must be protected from the operating hazards of the separate additional operations.

(c) Maintain proper payroll records. Refer to paragraph (F)(2) of this rule on maintenance of proper payroll records.

Example of two operations that could qualify as two separate businesses: an insured operates bowling lanes and a movie theater. These distinct operations can qualify as two separate businesses for classification purposes because:

(i) The operations of bowling lanes and movie theaters are not ordinarily conducted as one business, and therefore, are not included within each other's scope.

(ii) Either the bowling lane (if the movie theater ceases to exist) or the movie theater (if the bowling lane cease to exist) can be expected to continue its operations.

Examples of operations that must be separately classified because they are specifically excluded in the wording of a classification considered to be the insured's principal business:

(A) Code 0251 (irrigation works operation & drivers); code 0251 and the farm classification cannot be assigned to the same risk unless the operations described by these classifications are conducted as separate and distinct businesses. Irrigation system construction must be separately rated as code 6229.

(B) Code 5059 (iron or steel: erection-frame structures not over two stories in height); code 5040-iron or steel: erection-frame structures cannot be assigned to the same job or location that code 5059 applies to.

(C) Code 8265 (iron or steel scrap dealer & drivers); wrecking or salvaging must be separately rated. This code cannot be assigned to a risk engaged in an operation described by another classification unless the operations subject to Code 8265 are conducted as a separate and distinct business.

(ii) If the separate additional operation is not encompassed in the classification applicable to the insured's principal business and meets all the conditions listed in paragraph (D)(3)(c)(i) of this rule, the insured is considered to be engaged in an additional operation. If this is the case, a separate basic classification may be assigned to each operation that qualified as a separate additional operation.

(iii) If the additional operation does not meet all conditions listed in paragraph (D)(3)(c)(i) of this rule and is not encompassed in the classification applicable to the insured's principal business and has a rate:

(a) Lower than the insured's principal business, assign this operation to the same classification as the insured's principal business.

(b) Higher than or equal to the insured's principal business, assign this operation to the classification that describes the additional operation.

(iv) Policies with more than one classification may include employees working under several classifications. Payroll assignment for these employees is subject to the interchange of labor rule. Refer to paragraph (F) of this rule.

(d) Construction or erection operations.

These operations are identified by a "circle" immediately following the code number.

Each distinct type of construction or erection operation must be assigned to the class that specifically describes the operation only if separate payroll records are maintained for each operation.

If separate payroll records are not maintained for any construction or erection operation, the highest rated classification that applies to the job or location where the operation is performed must be assigned.

If a construction or erection operation is included in the scope of another classification, a separate code must not be assigned.

(i) Insured subcontractors.

An insured subcontractor who performs a single type of work on a construction project or job just be classified based on the classification that describes the particular work involved.

Example of how to classify the work performed by an insured subcontractor:

The insured subcontractor who performs only excavation work in connection with the construction of a sewer is classified under code 6217 (excavation) rather than under code 6306 (sewer construction).

Exception: all operations in conjunction with concrete construction including making and erecting forms, placing reinforcing steel and stripping forms, when done by subcontractors, must be assigned to the appropriate concrete construction classification.

(ii) Uninsured subcontractors.

Uninsured subcontractors covered under the principal or general contractor's policy are classified on the basis of the classification that would apply if the work were performed by the principal's own employees.

Example of how to classify the work performed by an uninsured subcontractor:

The uninsured subcontractor who performs only excavation work, but is covered under the policy of the principal contractor who is performing the construction of a sewer, is classified under code 6306 (sewer construction).

(e) Farm operations.

These operations are identified by a "square" immediately following the code number.

A farm is defined as any parcel(s) of land used for the purpose of agriculture, horticulture, viticulture, dairying, or stock or poultry raising as a business or commercial venture.

If separate payroll records are maintained, a division of payroll is allowed for each separate and distinct type of commercial farm operation.

If payroll records of the farm classification are not clear, and separate payroll records are not maintained, the entire payroll of the farm must be segregated on the basis of proportionate acreages.

Each farm classification includes:

(i) All employees.

(ii) Drivers.

(iii) All normal repair and maintenance of buildings or equipment performed by the employees of the insured.

(iv) Operations usual and incidental to a farm, such as:

(a) Maintenance of cows, hogs or chickens for family use.

(b) A family orchard or truck garden.

(c) Hay or grain crops raised for the purpose of maintaining work animals on the farm.

(d) Outside domestic workers at the farm location.

Each farm classification excludes inside domestic workers at the farm location.

(f) Employee leasing, labor contractors and temporary labor services.

(i) Workers assigned to clients must be classified the same as direct employees of the client performing the same or similar duties.

(ii) If the client has no direct employees performing the same or similar duties, leased employees are classified as if they were direct employees of the client entity.

Example of how to classify workers assigned to clients of employee leasing companies, labor contractors, and temporary labor services:

The client is a retail store classified to code 8017:

(a) Code 8017 is applicable to the worker assigned as a cashier, just as it is applicable to the client's employee who works as a cashier.

(b) Code 7380 is applicable to the worker assigned as a delivery truck driver, just as it is applicable to the client's employee who drives a delivery truck.

(g) Mercantile businesses.

These operations are identified by a "diamond" immediately following the code number.

A mercantile business is any store or dealer engaged in the sale of goods or merchandise, or in the sale of services.

For mercantile businesses, the classification is assigned separately for each location.

Store operations are classified based on the principal type of merchandise sold and whether the operations are wholesale or retail. For purposes of the rule, principal means more than fifty per cent of gross receipts, excluding receipts derived from the sale of lottery tickets.

The following definitions and instructions must be used to determine the appropriate store classification.

(i) Type of merchandise sold.

If a store sells a variety of goods, each of which may be subject to a different classification, the store must be assigned to the classification that best describes the merchandise that generates more than fifty per cent of the gross receipts.

(ii) Wholesale vs. retail.

Retail applies to the sale of merchandise to the general public for personal or household consumption or use and not for resale.

Wholesale applies to the sale of merchandise for resale to others; or sale to manufacturers, builders, contractors, or others for use in their business or as raw materials.

Exception: if a store's sales are clearly retail in nature, the appropriate retail store classification may be assigned regardless of the definition of retail.

Examples of store sales that are clearly retail in nature:

(a) A store selling artwork in a shopping mall whose majority of sales are for artwork purchased by businesses.

(b) A store selling art supplies in a shopping mall whose majority of sales are to artists who use the materials in their business.

(iii) Combination of retail and wholesale.

A store that sells merchandise on a combined wholesale and retail basis must be assigned to the appropriate store classification depending on whether the majority of gross receipts come from wholesale or retail sales.

(4) Standard exceptions.

Standard exceptions must be separately classified unless specifically included in a classification assigned to the business.

Classifications for standard exceptions apply even if the basic classification includes phrases such as "all employees" or "all operations."

Examples of classifications that include "all employees" or "all operations" but do not specifically refer to any standard exception employees:

(a) Code 6260 (tunneling-pneumatic-all operations); this classification does not specifically include any standard exception employees. Those employees are separately classified to codes 8810, 8871, 8742, and 7380.

(b) Code 8829 (convalescent or nursing home-all employees); this classification does not specifically include any standard exception employees. Those employees are separately classified to codes 8810, 8871, 8742, and 7380.

Examples of classifications that specifically include standard exception employees:

(i) Code 4361 (photographer-all employees & clerical, salespersons, drivers); this classification specifically includes clerical employees, salespersons, and drivers. For this type of business, those employees are not separately classified to codes 8810, 8871, 8742, and 7380.

(ii) Code 9061 (club NOC & clerical); this classification specifically includes clerical employees. For this type of business, those employees of this type of business are not eligible for classification to code 8810 or 8871.

(5) Businesses described by a standard exception classification.

If the principal business is described by a standard exception classification, the operations of all employees not included in the definition of standard exception classification must be assigned to the separate basic classification that most closely describes their operation.

Example of principal business that is described by a standard exception code: the insured is a public museum:

(a) Professional and clerical employees are assigned to code 8810.

(b) Maintenance employees are assigned to code 9101.

(c) Gift shop employees are assigned to code 8017.

(6) Classifications limited to separate businesses.

The assignment of certain classifications is limited by their notes to separate and distinct businesses because the notes may describe an operation that frequently is an integral part of a business described by another classification.

Example of assignment of a classification limited by a note:

(a) Code 4511 (Analytical laboratories or assaying - including laboratory, outside employees, collectors of samples, and drivers); cannot be assigned to a risk engaged in operations described by another classification unless the operations subject to code 4511 are conducted as a separate and distinct business.

(7) Repair operations.

Risks with shop operations that involve the repair of a product for which there is no repair classification are assigned to the classification that applies to the manufacture of the product, unless this repair work is specifically referred to by another classification, footnote, or definition in the manual.

Example of repair operations that are classified to the manufacturing code:

(a) A pump repair business is assigned to code 3612 (pump mfg.). There is no separate code for pump repair.

(b) A motor repair business is assigned to code 3643 (electric power or transmission equipment mfg.). There is no separate code for motor repair.

(8) Recycling operations.

(a) The collection, sorting and handling of recyclable materials for resale to others must be assigned to the appropriate store or dealer classification, or to the classification that most closely describes the business.

(b) Risks with operations that involve the reuse of materials for the production of a new product must be assigned to the classification that applies to the manufacture of the product unless such work is specifically referred to another classification, footnote, or definition in the manual.

(E) Payroll assignment: miscellaneous employees.

(1) Miscellaneous employees who perform duties that are commonly conducted for separate operations that are subject to more than one basic classification must be assigned to the governing classification.

(2) Miscellaneous employees include general superintendents (other than construction superintendents), maintenance or power plant employees, shipping or receiving clerks, and yard workers (other than construction).

Refer to paragraph (D)(5) of this rule if the governing classification is a standard exception.

Example of classification for miscellaneous employees:

The insured has two separate operations, a machine shop (code 3632) on one floor of the building and a plastics manufacturing business (code 4452) on another floor. If it is determined that code 3632 is the governing classification, all elevator operators, porters, cleaners, superintendents, and shipping clerks serving both operations are assigned to code 3632.

(F) Payroll assignment: interchange of labor.

Some employees may perform duties directly related to more than one properly assigned classification according to paragraph (D)(3) of this rule. Their payroll may be divided among the properly assigned classifications provided that:

(1) The classifications can be properly assigned to the employer according to the rules of the classification system.

(2) The employer maintains proper payroll records, which show the actual payroll by classification for that individual employee.

(a) Records must reflect actual time spent working within each job classification and an average hourly wage comparable to the wage rates for such employees within the employer's industry.

(b) Estimated or percentage allocation of payroll is not permitted.

Note: if payroll records do not show the actual payroll applicable to each classification, the entire payroll of the individual employee must be assigned to the highest rated classification that represents any part of his or her work.

(3) Payroll for holiday, vacation, sick pay, overtime and all other forms of payroll that are not directly attributable to a specific classification code must be allocated to the classification code with the greatest amount of payroll applicable to the individual employee.

If none of the classification codes applicable to the employee has the greatest amount of payroll, the payroll for holiday, vacation sick pay, overtime and all other forms of payroll that are not directly attributable to a specific classification code must be allocated to the highest rated classification code applicable to the employee.

(4) Some employees qualify for division of payroll between two or more basic classification codes and also engage in operations that are classified by codes 8810, 8742, 8748 or 8871. The payroll for these standard exception operations must be allocated to the basic classification code with the largest amount of payroll applicable to that employee.

(5) An executive order from the governor requires a business to change its standard means of operations.

For the duration of the executive order, if an employer has employees work from home, the appropriate classification for the operations performed will be assigned to the employer, and a division of payroll will be allowed between two or more classifications including standard exception classifications.

Examples of division payroll allowed under an executive order:

(a) Any operational employee sent home to telework and performs clerical duties or assigned no duties, all payroll is reported to 8871.

(b) When operational employees are sent home and continue to perform the same task or job duty as they performed at their employer's location the classification assigned to those operations does not change and reporting to class code 8871 is prohibited. Example, the employer manufactures surgical masks. The employees are sent home and continue to sew masks to meet customers' needs. The operational classification of 2501 cloth, canvas and related product manufacturing NOC still applies to these operations. The exposures for the employee do not change.

Exceptions:

Code 8810 (clerical office employees), code 8871 (clerical telecommuter employees), code 8742 (salespersons, collectors, or messengers-outside) and code 8748 (automobile salespersons) are not available for division of payroll under this rule. However, when an interchange of labor exists between code 8810 and code 8871:

(i) Code 8871 will be assigned when the employee spends more than fifty per cent of the time worked telecommuting as described by paragraph (B)(2)(a)(ii)(c) of this rule.

(ii) Code 8810 will be assigned when the employee spends fifty per cent or less of the time worked telecommuting as described by paragraph (B)(2)(a)(ii)(c) of this rule.

(c) The distribution of payroll for the employee may result in no single basic classification code that represents the largest amount of that employee's payroll. In such cases, the payroll included in the standard exception codes (8810, 8742, 8748 and 8871) will be assigned to the highest rated classification code that represents any part of the employee's work.

This rule does not apply to miscellaneous employees. Refer to paragraph (E) of this rule for these employees.

Examples of instances of interchange of labor where an employee's payroll may be divided between two or more classifications:

(i) In a business that manufactures clocks, all employees must be assigned to either code 3385 (clock mfg.), code 8810 (clerical), code 8742 (salespersons-outside), or code 7380 (drivers). In this example, division of payroll is only allowed for employees whose work is divided between activities described by codes 3385 and 7380. Codes 8810 and 8742 are not eligible for division of payroll.

(ii) In a business that sells furniture, all employees must be assigned to either code 8044 (store: furniture & drivers), code 8810 (clerical), or code 8742 (salespersons-outside). No division of payroll is allowed in this example, since drivers are already included in the basic classifications. Codes 8810 and 8742 are not eligible for division of payroll.

(iii) In a business that manufactures paper and also further processes this paper into wallpaper, all employees must be assigned to either code 4239 (paper mfg.), code 4279 (wallpaper mfg.), code 8810 (clerical), code 8742 (salespersons-outside), or code 7380 (drivers). A division of payroll is allowed for employees whose work is divided among activities described by codes 4239, 4279, and 7380. Codes 8810 and 8742 are not eligible for division of payroll.

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 7/1/1997, 7/12/2012
Rule 4123-17-09 | Clerical office payroll.
 

Clerical office payroll shall include only the payroll of those employees whose duties are confined to keeping the books and records of the risk, and conducting correspondence, and drafting, or who are engaged wholly in office work where such books and records are kept, having no other duties of any nature in or about the risk's premises.

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date:
Prior Effective Dates: 7/1/1962, 12/14/1976, 7/24/1989
Rule 4123-17-10 | Excess premiums.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to sections 4121.121, 4123.29, 4123.32, and 4123.34 of the Revised Code. Pursuant to sections 4123.29 and 4123.34 of the Revised Code, the administrator is to keep premiums at the lowest level consistent with the maintenance of a solvent state insurance fund and of a reasonable surplus. Pursuant to section 4123.321 of the Revised Code, in the event there is developed as of any given premium rate revision date a surplus of earned premium over all losses which, in the judgment of the bureau's board of directors, is larger than is necessary adequately to safeguard the solvency of the fund, the bureau's board of directors may return such excess surplus to the subscriber to the fund in either the form of cash refunds or a reduction of premiums, regardless of when the premium obligation has accrued. The bureau's board of directors has full discretion and authority to determine whether there is an excess surplus of premium; whether to return the excess surplus to employers; the nature of the cash refunds or reduction of premiums; the employers who are subscribers to the state insurance fund who are eligible for the cash refunds or reduction of premiums; the payroll period or periods for which a reduction of premium has accrued and the premium payment for which the reduction of premium applies; the applicable date of the cash refunds or reduction of premiums; and any other issues involving cash refunds or reduction of premiums due to an excess surplus of earned premium.

Last updated July 27, 2023 at 9:08 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.32, 4123.34
Five Year Review Date: 6/1/2028
Prior Effective Dates: 10/16/2008
Rule 4123-17-11 | Rule of merit rating controlling the employee having but one eye, one hand, etc.
 

Should any employee having but one hand, arm, eye, foot or leg thereafter lose any one of the foregoing members in an industrial accident or as the result of an occupational disease the same shall be merit-rated, not as a permanent total disability, but as a permanent partial disability, based upon the loss of the last member only. The remaining cost shall not be charged against the accident experience of the employer.

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date:
Prior Effective Dates: 7/1/1962
Rule 4123-17-12 | Catastrophe claims.
 

(A) A "catastrophe" is defined as an occurrence in which two or more employees of one employer are killed or receive injuries resulting in permanent and total disability.

(B) "Catastrophe cost" is defined as the total medical, compensation, and other costs, including reserves for future compensation costs, as a direct result of a catastrophe.

(C) Catastrophe cost in excess of two hundred fifty thousand dollars shall not be included in the experience of a classification or of an employer.

(D) Catastrophe cost in excess of two hundred fifty thousand dollars for a retrospective policy year as defined in rule 4123-17-41 of the Administrative Code, shall not be included in the annual evaluation or final settlement of that retrospective policy year.

(E) Notwithstanding the provisions of this rule, the administrator may consider any special circumstances which may affect the determination of a catastrophe.

Supplemental Information

Authorized By: 4121.121, 4121.13, 4121.30
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1982, 7/1/1991
Rule 4123-17-13 | Employer application for workers' compensation coverage.
 

(A) An employer may institute workers' compensation coverage under this rule by submitting an application for coverage that completely provides all the information necessary for the bureau of workers' compensation to establish coverage for the employer.

(1) The application for coverage shall be submitted on a form designated by the bureau that includes, at a minimum, the following information:

(a) The legal name and business entity type, for example corporation, limited liability company, sole proprietorship, or partnership;

(b) Address of the employer;

(c) The federal tax identification number or social security number of the employer;

(d) Information related to the description of the employer's operations, including:

(i) A description of the work done or industry conducted by the employer,

(ii) The estimated average number of employees in each kind of work, and

(iii) The estimated wages of employees in each kind of work over the next twelve months.

(e) Information related to whether the applicant for coverage has purchased an existing business or has another associated policy;

(f) Name of the owners or corporate officers, and, where applicable for elective coverage, the name and necessary identifying information of the sole proprietor, partners, ministers, or officers of the family farm corporation;

(g) Signature of the person completing the application for coverage; and

(h) A non-refundable application fee equal to the minimum administrative annual charge set forth in rule 4123-17-26 of the Administrative Code.

(2) If the bureau receives an application for coverage that does not contain all of the information specified by paragraph (A)(1) of this rule, the bureau will attempt to contact the employer to obtain the necessary information. If the applicant does not provide the necessary information, the bureau will deny the employer's application for coverage based upon the employer's failure to provide all the information specified by paragraph (A)(1) of this rule.

(3) When an applicant fails to provide the information specified by paragraph (A)(1) of this rule and has employed one or more persons, the employer may be considered a non-complying employer under rule 4123-14-01 of the Administrative Code, and the bureau may recover premium and penalties from the employer under rule 4123-14-02 of the Administrative Code.

(B) Upon receipt of the application, the bureau will assign payroll to the classification codes applicable to the duties performed. The bureau will provide the employer notice of its determination regarding the employer's classification codes and division of the employer's payroll within those classification codes, the rates for those classification codes, and estimated premium due for the remainder of the policy year in which the employer applies for initial coverage.

(C) If the bureau determines, after reviewing the information submitted with the application provided for in paragraph (A) of this rule, that the employer was subject to division (B)(2) of section 4123.01 of the Revised Code but failed to comply with the law in matters of workers' compensation coverage, the bureau will notify the employer in writing of such a finding and request any additional information necessary to make a determination of the period for which the employer was not in compliance with the law. Upon such determination, the bureau will notify the employer of the premium and assessments due for the period of noncompliance.

(D) If the bureau determines, after reviewing the information submitted with the application provided for in paragraph (A) of this rule, that the employer is essentially the same employer, regardless of entity type for which workers' compensation coverage previously had been provided, the bureau may do either of the following:

(1) Transfer the prior policy to the employer, and if necessary reactivate a previously cancelled policy in order to complete the transfer, pursuant to rule 4123-17-02 of the Administrative Code, and the employer will assume any outstanding obligations under the prior policy; or

(2) Deny or rescind the application, and the employer will maintain the prior or existing policy.

(E) Upon receipt of the application fee, the bureau will issue a notice of workers' compensation coverage pursuant to section 4123.83 of the Revised Code. The notice will indicate that coverage is contingent on payment of estimated premium and assessments due.

(F) Upon receipt of the application fee,, the employer's coverage begins.

(1) Unless the provisions of paragraph (D) of this rule apply, such coverage is effective from the date of receipt of the application for coverage pursuant to paragraph (A) of this rule.

(2) A credit in an amount equal to the application fee will be applied to the employer's account upon receipt of the first estimated premium payment.

(3) If the first estimated premium payment is not made, the employers coverage will lapse back to the effective date of the policy.

Last updated July 27, 2023 at 9:08 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29, 4123.32, 4123.34
Five Year Review Date: 6/1/2028
Prior Effective Dates: 6/30/1974, 11/26/1979, 12/20/2007
Rule 4123-17-14 | Reporting of payroll and reconciliation of premium due.
 

(A) Definitions.

(1) As used in this chapter of the Administrative Code:

(a) "Applied EM" means the experience modification, or "EM," as set forth in rule 4123-17-03 of the Administrative Code, except where such EM is modified by participation in the group experience rating program set forth in rules 4123-17-61 to 4123-17-66 of the Administrative Code, the one-claim program set forth in rule 4123-17-71 of the Administrative Code, or the EM cap program set forth in rule 4123-17-03.2 of the Administrative Code. In such cases, "applied EM" means the experience modifier resulting from participation in those programs.

(b) "Current" with respect to payments due the bureau of workers' compensation means not more than forty-five days past due.

(c) "Payments due the bureau" means any premiums, administrative costs, assessments, fines or monies otherwise due to any fund administered by the bureau for which the employer has not submitted a dispute of the obligation to the bureau's adjudicating committee as set forth in rule 4123-14-06 of the Administrative Code.

(d) "Payroll" or "wages" means the entire remuneration allowed by an employer to employees in the employer's service for the applicable period.

(e) "Public employer taxing district" means an employer that is not the state itself and subject to the provisions of sections 4123.38 and 4123.39 of the Revised Code.

(f) "Remuneration" has the same meaning as defined in division (H) of section 4141.01 of the Revised Code.

(i) The definition of remuneration applies to all persons of such employers considered to be employees under the statutes or rules of the bureau, regardless of whether the employer is required to report payroll or remuneration to the Ohio department of job and family services under Chapter 4141. of the Revised Code or whether the employer reports payroll or remuneration to the Ohio department of job and family services for such persons considered to be employees by the bureau.

(ii) For employees who customarily receive tips or gratuities, remuneration includes all actual wages paid and all tips and gratuities.

(2) All other terms have the same meaning as prescribed in section 4123.01 of the Revised Code.

(B) Private employers: notice of estimated premium.

(1) Except as otherwise provided in paragraph (E) of this rule, the bureau will notify private employers of the development of estimated premium no later than the first day of May preceding the policy year for which such premium is due.

(2) The bureau will provide all of the following:

(a) The estimated payroll used by the bureau to calculate the employer's estimated premium due;

(b) The classification codes in which the employer's payroll is allocated and the base rates for each of the classification codes identified;

(c) The employer's applied EM used in determining premium due; and

(d) The employer's estimated premium due for the applicable policy year.

(3) An employer may revise the estimated payroll amount used to calculate estimated premium due for the policy year for good cause shown, as determined by bureau policy.

(a) The estimated premium will be revised for the policy year and the balance of installments for the remainder of the policy year will be adjusted to reflect the new estimated premium amount.

(b) Requests will not be accepted to revise payroll for a policy year after the last business day of March in that policy year; the adjustment to premium due will be upon the employer's report of actual payroll pursuant to paragraph (D) of this rule.

(C) Private employers: invoice and estimated premium payments.

(1) Except as otherwise provided in paragraph (E) of this rule, the bureau will provide private employers with an invoice for estimated premium no later than the first day of June immediately preceding the policy year for which the estimated premium is charged. The bureau will provide subsequent invoices according to a schedule made available with the notice of estimated premium.

(2) Payment of invoices will be due no later than the date indicated on each invoice.

(3) The administrator of workers' compensation may assess penalties and late fees on payments received after the deadlines set forth in paragraph (C)(2) of this rule, pursuant to rule 4123-17-16 of the Administrative Code.

(D) Private employers: payroll report and reconciliation of premium due.

(1) Except as otherwise provided in paragraphs (D)(5) and (E) of this rule, after the conclusion of each policy year, every private employer shall submit a payroll report to the bureau containing the number of employees employed within each of the employer's assigned classification codes and the aggregate amount of wages paid to such employees over the relevant time period.

(2) The bureau will establish an electronic payroll reconciliation process to address the difference between estimated gross payroll and actual gross payroll immediately upon the filing of the payroll report.

(3) The payroll report shall report data for the full policy year. The report must be filed by, and any payment due the bureau paid by the fifteenth day of August, and effective the policy year beginning July 1, 2024, by the thirty-first day of August, immediately following the conclusion of the policy year. Any balance due the employer will be credited to the employer's account.

(4) An employer may elect to provide payment other than through the electronic reconciliation process, provided payment is received by the fifteenth day of August, and effective the policy year beginning July 1, 2024, by the thirty-first day of August, immediately following the conclusion of the policy year.

(5) The administrator may waive the provisions of paragraph (D)(1) of this rule for private employers who:

(a) Are not subject to the provisions of paragraph (E) of this rule;

(b) Do not have any employees in the policy year, including no employees subject to rule 4123-17-07 of the Administrative Code; and

(c) Have reported no payroll on the payroll report for the three previous policy years.

(E) Alternate employer organizations and professional employer organizations.

(1) Each employer that is recognized by the administrator as an alternate employer organization ("AEO"), as defined in section 4133.01 of the Revised Code, or as a professional employer organization ("PEO") as defined in section 4125.01 of the Revised Code, shall submit a monthly payroll report.

(2) The AEO or the PEO shall electronically report data for each month no later than the fifteenth day after the last day of the month for which payroll is being reported and pay all monthly premium and assessments concurrently with the filing of the monthly payroll report.

(3) If an AEO or a PEO fails to make timely payment of premiums and assessments pursuant to this rule, coverage will lapse, and the administrator will proceed to revoke the registration of the AEO or the PEO pursuant to rule 4123-17-15.7 of the Administrative Code.

(F) Public employer taxing districts: notice of estimated premium.

(1) The bureau will notify public employer taxing districts of the development of estimated premium due no later than the last day of October preceding the start of the policy year.

(2) The bureau will provide all of the following:

(a) The estimated payroll used by the bureau to calculate the employer's estimated premium due;

(b) The classification codes in which the employer's payroll is allocated and the base rates for each of the classification codes identified;

(c) The employer's applied EM; and

(d) The employer's estimated premium due for the applicable policy year.

(3) An employer may revise the estimated payroll amount used to calculate estimated premium due for the policy year for good cause shown, as determined by bureau policy.

(a) The estimated premium will be revised for the policy year and the balance of installments for the rest of the year will be adjusted to reflect the new estimated premium amount.

(b) Requests will not be accepted to revise payroll for a policy year after the last business day of September in that policy year; the adjustment to premium due will be upon the employer's report of actual payroll pursuant to paragraph (H) of this rule.

(G) Public employer taxing districts: invoice and estimated premium payments.

(1) The bureau will provide public employer taxing districts with an invoice for estimated premium no later than the first day of December immediately preceding the policy year for which the estimated premium is charged. The bureau will provide subsequent invoices according to a schedule made available with the notice of estimated premium.

(2) Payment of invoices will be due no later than the date indicated on each invoice.

(3) The administrator may assess penalties and late fees on payments received after the deadlines set forth in paragraph (G)(2) of this rule pursuant to rule 4123-17-16 of the Administrative Code.

(H) Public employer taxing districts: payroll report and reconciliation of premium due.

(1) After the conclusion of each policy year, every public employer taxing district shall submit a payroll report to the bureau containing the number of employees employed within each of the employer's assigned manual classifications and the aggregate amount of wages paid to such employees over the policy year.

(2) The employer shall submit its payroll report electronically and remit any payments due the bureau no later than the fifteenth day of February, and effective the policy year beginning January 1, 2025, no later than the last day of February, immediately following the conclusion of the policy year. Immediately upon receipt of the payroll report, the bureau will adjust the premium and assessments charged to each employer for the difference between estimated gross payrolls and actual gross payrolls. At the conclusion of the payroll and premium reconciliation, each employer shall remit any payments due the bureau. If the reconciled premium results in a credit, the bureau will post such credit to the employer's account.

(I) Allocation of payroll.

(1) If an employer elects under section 4123.292 of the Revised Code to obtain other-states' coverage directly from an other-states' insurer for employment relationships localized in Ohio, the employer shall notify the bureau of the election on a form prescribed by the bureau and provide the bureau with a copy of the other-states' coverage policy.

(2) An employer that elects to obtain other-states' coverage directly from an other-states' insurer under section 4123.292 of the Revised Code shall include on the payroll report required by this rule only the remuneration for work the employees performed in Ohio and other work not covered by the other-states' policy. The employer will maintain documentation of the amount of remuneration paid to its employees for work performed outside of Ohio and covered by the other-states policy and provide it to the bureau upon request.

(3) If an employer employs an employee covered under a federal Longshore and Harbor Workers' Compensation Act policy, the employer shall include on the payroll report the remuneration for work the employees performed in Ohio for which the employees are eligible to receive compensation and benefits under Chapters 4121. and 4123. of the Revised Code. The employer will maintain documentation of the amount of remuneration for work covered by an insurer under the federal Longshore and Harbor Workers Compensation Act and provide it to the bureau upon request.

Last updated July 27, 2023 at 9:08 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30
Amplifies: 4123.24, 4123.26, 4123.29, 4123.32, 4123.34
Five Year Review Date: 6/1/2028
Prior Effective Dates: 6/30/2003 (Emer.), 7/1/2016
Rule 4123-17-14.1 | Misrepresentation of payroll.
 

(A) No employer shall knowingly misrepresent to the bureau of workers' compensation the amount or classification of payroll upon which the premium under this chapter is based. No self-insuring employer shall knowingly misrepresent to the bureau the amount of paid compensation paid by such employer.

(B) As used in the rule, "knowingly" means that the employer had actual knowledge of the misrepresentation and was aware that the misrepresentation would cause a certain result. An employer will not be deemed to have knowingly misrepresented its payroll, its classification of payroll, or its paid compensation where the employer's determination of how to report was based on:

(1) The employer's reasonable interpretation of a law, rule, or classification code; or

(2) Prior reporting instructions or written advice received from the bureau.

(C) Whenever the bureau finds that an employer violated division (A) of section 4123.25 of the Revised Code by knowingly misrepresenting its payroll or classification of payroll to the bureau, the administrator of workers' compensation or the administrator's designee may impose a penalty that the administrator or the administrator's designee deems appropriate upon the employer based on the following criteria:

(1) Amount of difference between the premium the employer paid and the amount the employer should have paid;

(2) The frequency with which the employer has misrepresented its payroll or classification of payroll to the bureau;

(3) The number of misrepresentations or misclassifications the employer has made to the bureau;

(4) The duration for which the employer made such misrepresentations or misclassifications;

(5) Whether the bureau has found misclassified or underreported payroll in a premium audit on prior occasion; and

(6) Any additional circumstances that warrant consideration in determining the penalty amount.

(D) The penalty imposed under paragraph (C) of this rule will not exceed ten times the amount of the difference between the premium the employer paid and the amount the employer should have paid.

(E) Whenever the self-insuring employers evaluation board finds that a self-insuring employer violated division (B) of section 4123.25 of the Revised Code by knowingly misrepresenting its paid compensation to the bureau, the self-insuring employers evaluation board may impose a penalty upon the employer as provided under section 4123.25 of the Revised Code.

(F) Except for a self-insuring employer, an employer may appeal a penalty imposed under this rule to the adjudicating committee under section 4123.291 of the Revised Code.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.25
Five Year Review Date: 6/1/2028
Prior Effective Dates: 9/23/2013
Rule 4123-17-14.2 | Installment payments.
 

(A) An employer may elect to pay its estimated premium due in equal installments of two, four, six, or twelve in number.

(1) Employers paying in advance of the installment schedule will not incur a penalty for early payment.

(2) Employers paying the minimum administrative charge shall not be eligible for an installment plan.

(B) Initial installment plans.

(1) All eligible private employers will be invoiced on the six-payment installment plan.

(2) All eligible public employer taxing districts will be invoiced on the twelve-payment installment plan.

(C) An employer may change its installment plan upon request.

(1) A private employer must request a change in installment plan no later than the fiftheent day of May preceding the start of the policy year.

(2) A public employer taxing district must request a change in installment plan no later than the fifteenth day of November preceding the start of the policy year.

(D) Each installment shall be due by the date indicated on the invoice.

(E) In making payment arrangements with an employer, the bureau may alter an installment plan if it determines such change is appropriate.

(F) Election of installment payments under this rule shall not disqualify an employer from participation in the rating plans and discount programs established in this chapter, but any lapse periods imposed on an employer for failure to timely pay installments shall be counted toward the maximum number of days during which an employer is permitted to be lapsed in the eligibility criteria for such rating plans and discount programs.

(G) A public employer taxing district may elect to defer payment of installments due prior to April thirtieth in that policy year until April thirtieth. Such election must occur on or before November fifteen of the previous policy year. If an employer makes such election, the bureau will apply a deferment fee of 0.94 per cent to the total amount of the installments that are deferred.

(H) The bureau will grant an early payment discount to an employer that pays the full twelve month estimated annual premium by the due date for the first installment for each policy year. The employer must be in an active policy status as of the due date for the first installment to be eligible for this discount. For purposes of this rule, "active policy status" does not include a policy that is a no coverage policy or a policy that is lapsed. If an employer elects to pay all installments in a single payment, the bureau will grant a discount to the eligible employer for that policy period as set forth in this rule. The discount cannot reduce the total amount due below the minimum required premium as provided in rule 4123-17-26 of the Administrative Code.

(1) A discount of two per cent will be available to private employers for the policy years commencing on July 1, 2017.

(2) A discount of two per cent will be available to public employer taxing districts for the policy years commencing on January 1, 2017.

Last updated June 20, 2023 at 9:10 AM

Supplemental Information

Authorized By: 4121.30, 4121.121, 4121.12
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Rule 4123-17-14.4 | Lapse-free rebate.
 

(A) The administrator may offer a rebate to employers that do not have a lapse in coverage for a period of sixty consecutive months.

(B) For purposes of this rule, "rebate eligibility evaluation date" means:

(1) For the private employer policy year, the July first immediately after the policy year.

(2) For the public employer taxing district policy year, the January first immediately after the policy year.

(C) Eligibility requirements.

(1) To receive the lapse-free rebate, an employer must:

(a) Be in active status;

(b) As of the rebate eligibility evaluation date, not have had any lapse in coverage during the sixty months preceding the rebate eligibility evaluation date; and

(c) Report actual payroll for the applicable policy year and pay any premium due upon reconciliation of estimated premium and actual premium no later than the date set forth in rule 4123-17-14 of the Administrative Code.

(2) The following employers shall not be eligible for the lapse-free rebate:

(a) Employers paying the minimum administrative charge for the applicable payroll reporting period as set forth in rule 4123-17-26 of the Administrative Code.

(b) State agencies.

(c) Self-insuring employers providing compensation and benefits pursuant to section 4123.35 of the Revised Code.

(D) The rebate shall be the amount identified in the appendix to rule 4123-17-75 of the Administrative Code times the employer's blended premium costs in the applicable policy year, subject to any limits set forth in such appendix.

Last updated January 11, 2024 at 8:38 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13
Amplifies: 4121.12, 4121.121, 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 9/4/2014
Rule 4123-17-15 | Alternate employer organizations and professional employer organizations.
 

(A) Definitions.

As used in rules 4123-17-15 to 4123-17-15.7 of the Administrative Code:

(1) "Alternate employer organization" or "AEO" has the same meaning as defined in section 4133.01 of the Revised Code. "Alternate employer organization" or "AEO" does not include a service agency that is in the business of employing individuals for the purpose of utilizing the services of the individuals for a temporary period of time.

(2) "Professional employer organization" or "PEO" has the same meaning as defined in section 4125.01 of the Revised Code. PEOs that coemploy a part of a client employer's workforce are to comply with the provisions set forth in paragraph (C) of this rule. "Professional employer organization" or "PEO" does not include a service agency that is in the business of employing individuals for the purpose of utilizing the services of the individuals for a temporary period of time.

(3) "Client employer" has the same meaning as defined in section 4125.01 of the Revised Code for client employers of a PEO and section 4133.01 of the Revised Code for client employers of an AEO. "Client employer" does not mean an employer who is a noncomplying employer as defined in rule 4123-14-01 of the Administrative Code.

(4) "AEO agreement" means an alternate employer organization agreement as defined in section 4133.01 of the Revised Code. On entering into an AEO agreement all worksite employees of a client employer are covered under the workers compensation policy of the AEO.

(5) "PEO agreement" means a professional employer organization agreement as defined in section 4125.01 of the Revised Code.

(6) "PEO reporting entity" means a professional employer organization reporting entity as defined in section 4125.01 of the Revised Code.

(7) "Assurance organization," "coemploy," and "shared employee" have the same meaning as defined in section 4125.01 of the Revised Code.

(8) "Trade secret" has the same meaning as defined in section 1333.61 of the Revised Code.

(9) "Working capital" means the excess of current assets over current liabilities as determined by generally accepted accounting principles.

(10) "Worksite employee" has the same meaning as defined in section 4133.01 of the Revised Code.

(11) "Policy number," is a term synonymous with "risk number," meaning the identification number that the bureau of workers' compensation assigns to an employer.

(B) Where an AEO or a PEO is required to give notice, register, or make a report to the bureau under rules 4123-17-15 to 4123-17-15.7 of the Administrative Code, the AEO or the PEO shall do so on forms prescribed by the bureau. Forms are to be completed in full, as determined by the bureau, for such notice, registration, or report to be effective.

(C) Partial leases.

(1) A PEO may enter into a PEO agreement to coemploy part of a client employer's workforce, provided the client employer is not a temporary agency, for workers' compensation purposes only to the extent wages are paid by and reported under the tax identification number of the PEO for federal tax purposes.

(2) Under such partial lease agreement, the PEO shall report under its workers' compensation policy number the payroll associated with the wages paid by and reported by the PEO for federal tax purposes under the PEO's tax identification number. The client employer shall report under its workers' compensation policy number all payroll associated with wages not paid by and not reported under the PEO's tax identification number.

(3) All of a client employer's payroll within a classification code is to be reported in its entirety under either the workers' compensation policy number of the PEO or client employer; such payroll cannot be split between the PEO and client employer.

(D) Obligations of an AEO.

An AEO must perform all of the following functions:

(1) Annually provide written notice to each worksite employee an AEO assigns to perform services to a client employer of the relationship between and the responsibilities of the AEO and the client employer;

(2) Process and pay all wages and applicable state and federal payroll taxes associated with the worksite employee under the federal tax identification tax number of the client employer, either directly by the AEO or through a third party vendor contracted by the AEO that is not a client employer, irrespective of payments made by the client employer, pursuant to the terms and conditions of compensation in the AEO agreement between the AEO and the client employer.

(3) Pay all related payroll taxes associated with a worksite employee under the federal tax identification number of the client employer independent of the terms and conditions contained in the AEO agreement between the AEO and the client employer.

(4) Annually certify to the bureau that all client employer federal payroll taxes have been timely and appropriately paid and provide proof of payment to the bureau upon request.

(5) In any AEO agreement between an AEO and a client employer, list the client employer on the W-2 of all worksite employees, but the AEO remains jointly and severally liable for all applicable local, state, and federal withholding and employer-paid taxes with respect to the worksite employees.

(6) File federal payroll taxes entirely under the tax identification number of the client employer but remain jointly and severally liable for all wages and payroll taxes associated with worksite employees.

(7) If any client employer of an AEO fails to transmit payment to the AEO sufficient to cover payment of all wages and employer-paid taxes, keep a record of the nonpayment or underpayment and a record that the AEO nonetheless paid the wages and taxes owed.

(8) Maintain workers' compensation coverage, pay all workers' compensation premiums, and manage all workers' compensation claims, filings, and related procedures associated with the worksite employee in compliance with Chapters 4121. and 4123. of the Revised Code under the AEO's policy number, except that when worksite employees include elective coverage persons as those terms are defined in rule 4123-17-07 of the Administrative Code, payroll reports are to include the entire amount of payroll associated with those persons and are not subject to the weekly minimum and maximum provided in rule 4123-17-30 of the Administrative Code.

(9) Maintain complete records separately listing the classification codes of each client employer and the payroll reported to each classification code for each client employer for each payroll reporting period during the time period covered in the AEO agreement. Payroll is to be kept in a manner that clearly identifies the appropriate classification codes assigned to each client employer, the payroll reported in each classification code, and the amount of premiums paid for each client employer for each payroll period covered in the AEO agreement.

(10) Maintain a complete record of workers' compensation claims for each client employer, with claims separately identified according to the client employer.

(11) Report individual client employer payroll, claims, and classification data under a separate and unique subaccount to the bureau.

(12) Within fourteen days of receiving notice from the bureau that a dividend, refund, or rebate will be applied to workers compensation premiums, provide a copy of that notice to any client employer to whom that notice is relevant.

(13) Within thirty days after receiving a dividend, refund, or rebate that is applied to workers compensation premiums, either fully redistribute or fully credit the client employer to whom that dividend, refund, or rebate is relevant.

(14) Not provide partial or split workers' compensation coverage for worksite employees in which the client employer provides that coverage for some, but not all, of the client employer's worksite employees.

(E) Obligations of a PEO.

A PEO must perform all of the following functions:

(1) Provide written notice to each shared employee it assigns to a client employer of the relationship between and the responsibilities of the PEO and the client employer.

(2) Pay wages and payroll taxes associated with shared employees as established within the PEO agreement, either directly by the PEO or through a third party vendor contracted by the PEO that is not a client employer. The responsibility for making payments under this section is not contingent on receipt of payment from the client employer. Shared employee wages are to be paid by and reported under the tax identification number of the PEO for federal tax purposes. A PEO may only enter into agreements in which all employees of the client employer are shared and reported under the PEO's tax identification number for federal tax purposes, but reported under the client employer's policy number for workers' compensation purposes, when:

(a) The client employer's payroll is wholly reported under the PEO employer's tax identification number for federal tax purposes; and

(b) The client employer's payroll is wholly reported under the client employer's policy number for workers' compensation purposes.

(3) Be responsible for maintaining both adequate and required employment-related records for employees, and for reporting such information as may be required by appropriate governmental agencies.

(4) Comply with applicable state laws regarding workers' compensation insurance coverage.

(5) Maintain complete records, separately listing the payroll and claims of its client employers for each payroll reporting period. Payroll is to be kept in a manner that clearly identifies the appropriate classification codes assigned to each client employer, the payroll reported in each classification code, and the amount of premiums paid for each client employer for each payroll period covered in the PEO agreement. Claims are to be separately identified according to the client employer.

(6) Report individual client employer payroll, claims, and classification data under a separate and unique subaccount to the bureau.

(7) Maintain workers' compensation coverage, pay all workers' compensation premiums and manage all workers' compensation claims, filings, and related procedures associated with a shared employee in compliance with Chapters 4121. and 4123. of the Revised Code, except that when shared employees include ministers or elective coverage persons as those terms are defined in rule 4123-17-07 of the Administrative Code, payroll reports are to include the entire amount of payroll associated with those persons and are not subject to the weekly minimum and maximum provided in rule 4123-17-30 of the Administrative Code. The PEO must maintain workers' compensation coverage under its workers' compensation policy number for all payroll reported under its tax identification number for federal tax purposes, except as provided in paragraph (D)(2) of this rule.

(8) Within fourteen days after receiving notice from the bureau that a dividend, refund, or rebate will be applied to workers' compensation premiums, provide a copy of that notice to any client employer to whom that notice is relevant.

(9) Within thirty days after receiving a dividend, refund, or rebate that is applied to workers compensation premiums, either fully redistribute or fully credit the client employer to whom that dividend, refund, or rebate is relevant.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30, 4123.05, 4125.02, 4133.02
Amplifies: 4123.34, 4125.01, 4125.02, 4125.03, 4133.01, 4133.02, 4133.03
Five Year Review Date: 6/1/2028
Prior Effective Dates: 7/1/1997, 2/17/2014, 1/13/2022
Rule 4123-17-15.1 | AEO agreements and PEO agreements.
 

(A) Where a client employer enters into an AEO or a PEO agreement:

(1) Each client employer must establish and maintain an individual account with the bureau of workers' compensation.

(2) The AEO or the PEO is considered the succeeding employer, solely for purposes of workers' compensation experience, and is subject to rule 4123-17-02 of the Administrative Code.

(3) If the AEO agreement or the PEO agreement between a client employer and the AEO or the PEO is terminated, or if the AEO or the PEO declares bankruptcy or ceases operation in Ohio, the AEO or the PEO must notify the bureau and each client associated with that AEO or that PEO within thirty days from the effective date of termination, and identify on forms prescribed by the bureau the portion of the experience of the AEO or the PEO related to the client employer that will be transferred to the client employer.

(4) An AEO or a PEO shall report any transfer of employees between related AEO entities, PEO entities or PEO reporting entities to the bureau within fourteen calendar days after the date of the transfer. The AEO, the PEO, or the PEO reporting entity shall include in the report all client payroll and claim information regarding the transferred employees and a notice of all workers' compensation claims that have been reported to the AEO, the PEO, or the PEO reporting entity in accordance with the internal reporting policies of the AEO, the PEO or the PEO reporting entity.

(B) An AEO or a PEO shall notify the bureau within thirty days when entering into an AEO agreement or a PEO agreement, or when changing the type of a PEO agreement. The AEO, or the PEO for payroll reported under the PEO's policy, must list payroll within the existing classification codes of the client employer. If the bureau is not notified within thirty days, the bureau will recognize the AEO agreement or the PEO agreement on the date the bureau receives notice and the client employer is responsible for reporting payroll and claims under the client employer's individual policy until the recognized effective date of the agreement.

(C) An AEO or a PEO which enters into an AEO agreement or a PEO agreement with a noncomplying employer or an AEO or a PEO which fails to comply with rules 4123-17-15 to 4123-17-15.7 of the Administrative Code will not be considered the employer for workers' compensation purposes. In these instances, the payroll of the shared employees is to be reported by the client employer under its workers' compensation policy number for workers' compensation premium and claims purposes, unless barred by federal law. Claims that are filed by the client employer's shared employees will be charged to the experience of the client employer.

(D) The bureau will not recognize an AEO agreement or a PEO agreement between an out of state client employer and an AEO or a PEO where the employees of the out of state client employer do not have sufficient contacts with Ohio to meet the jurisdictional conditions for coverage.

(E) An AEO agreement or a PEO agreement, or a change in an AEO agreement or a PEO agreement, filed with the bureau will have the following effective date with the bureau for workers' compensation premium and claims purposes:

(1) For a self-insured AEO or self-insured PEO entering into an AEO agreement or a PEO agreement, the commencement date of the AEO agreement or PEO agreement; or

(2) For a state fund AEO or state fund PEO entering into an AEO agreement or a PEO agreement or changing an AEO agreement or a PEO agreement, and for a self-insured AEO or self-insured PEO changing an existing AEO agreement or PEO agreement:

(a) If the commencement date of the AEO agreement or the PEO agreement, or change in the AEO agreement or the PEO agreement, is January first or July first, the commencement date; or

(b) If the commencement date of the AEO agreement or the PEO agreement, or change in the AEO agreement or the PEO agreement, is not January first or July first, the next January first or July first, whichever is earlier.

(F) An AEO or a PEO cannot enter any AEO agreement or PEO agreement where the client employer is an AEO or a PEO, and the bureau will not recognize any AEO agreement or PEO agreement where the client employer is an AEO or a PEO.

(G) The following acts are not permitted:

(1) A PEO from entering into an AEO agreement with any client employer, and

(2) An AEO from entering into a PEO agreement with any client employer.

(H) For each occurrence of the following, an AEO or a PEO will be assessed fifty dollars as a late processing fee:

(1) The AEO or the PEO fails to notify the bureau within thirty days when entering into, or changing, an AEO agreement or a PEO agreement;

(2) The AEO or the PEO fails to notify the bureau or client employer within thirty days of termination of an AEO agreement or a PEO agreement;

(3) The AEO or the PEO fails to notify the bureau or a client employer within thirty days of declaring bankruptcy; and

(4) The AEO or the PEO fails to notify the bureau or a client employer within thirty days of ceasing operations in Ohio.

(I) An AEO or a PEO may appeal any late processing fees assessed by the bureau under paragraph (H) of this rule pursuant to the administrative hearing procedure set forth in section 4123.291 of the Revised Code.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30, 4123.05, 4123.291, 4125.02, 4133.02
Amplifies: 4123.34, 4123.54, 4125.03, 4125.04, 4125.05, 4125.07, 4133.03, 4133.04, 4133.07, 4133.10
Five Year Review Date: 6/1/2028
Prior Effective Dates: 1/13/2022
Rule 4123-17-15.2 | Registration and reporting requirements.
 

(A) The AEO or the PEO shall register with the bureau of workers' compensation no later than thirty days after the formation of the AEO or the PEO. An AEO or a PEO operating in this state shall register annually with the administrator of workers' compensation.

(1) The AEO or the PEO will submit an initial registration fee as set forth in the appendix to this rule with its initial application. The AEO or the PEO will submit an annual renewal fee as set forth in the appendix to this rule to the bureau on or prior to December thirty-first of each year.

(2) The AEO or the PEO will submit the following information when registering with the bureau:

(a) A list of each of the client employers of the AEO or the PEO that is current as of the date of registration for purposes of initial registration or current as of the date of annual registration renewal, or within fourteen days of adding or releasing a client, that includes the client employer's name, address, federal tax identification number, and bureau of workers' compensation policy number;

(b) The name or names under which the AEO or the PEO conducts business;

(c) The address of the principal place of business of the AEO or the PEO and the address of each office it maintains in this state;

(d) The taxpayer or employer identification number of the AEO or the PEO;

(e) A list of each state in which the AEO or the PEO has operated in the preceding five years, and the name, corresponding with each state, under which the AEO or the PEO operated in each state, including any alternative names, names of predecessors, and if known, successor business entities, and whether the entity is an AEO or PEO in the other state(s);

(f) A list of all corporate officers of the AEO or the PEO;

(g) A list of all related corporate entities;

(h) An attestation of the accuracy of the data submissions from the chief executive officer, president, or other individual who serves as the controlling person of the AEO or the PEO;

(i) Security pursuant to sections 4125.05 and 4133.07 of the Revised Code; and

(j) The most recent financial statement prepared and audited in accordance with rule 4123-17-15.4 of the Administrative Code, and such financial statement is to be no older than thirteen months at the time it is submitted to the bureau.

(B) On an annual basis, on a date determined by the bureau, the AEO or the PEO shall provide an annual report of its client employers and total workforce to the bureau. The report will list all individual employees, by client employer. For each employee, the AEO or the PEO will provide employee identification information, quarterly payroll, associated classification code, title or position, and department.

(C) A PEO reporting entity that will complete the financial reporting mandates of this chapter for commonly owned or controlled PEOs must register with the bureau and pay an initial registration fee as set forth in the appendix to this rule.

(1) The PEO reporting entity shall submit the following information when registering with the bureau:

(a) A list of each of the PEOs for which the PEO reporting entity will complete financial reporting mandates;

(b) The name or names under which the PEO reporting entity conducts business;

(c) The address of the PEO reporting entity's principal place of business and the address of each office it maintains in this state;

(d) The PEO reporting entity's taxpayer or employer identification number;

(e) A list of all corporate officers of the PEO reporting entity;

(f) The most recent financial statement prepared and audited in accordance with rule 4123-17-15.4 of the Administrative Code, and such financial statement is to be no older than thirteen months at the time it is submitted to the bureau;

(g) Security pursuant to section 4125.05 of the Revised Code; and

(h) An attestation of the accuracy of the data submissions from the chief executive officer, president, or other individual who serves as the controlling person of the PEO reporting entity.

(2) The PEO reporting entity will renew such registration and pay an annual renewal fee as set forth in the appendix to this rule no later than December thirty-first of each year.

(D) The administrator may grant limited registration to an AEO or a PEO for reasons specified by the administrator in the certificate of limited registration if the AEO or the PEO provides all of the following items:

(1) A properly executed request for limited registration on a form prescribed by the bureau;

(2) A limited registration fee as set forth in the appendix to this rule;

(3) All information set forth in paragraphs (A)(2)(a) to (A)(2)(h) of this rule; and

(4) Information and documentation necessary to show that the AEO or the PEO satisfies all of the following criteria:

(a) The AEO or the PEO is domiciled outside of Ohio and does not maintain an office in the state;

(b) The AEO or the PEO is licensed or registered as an AEO or a PEO in another state;

(c) The AEO or the PEO does not participate in direct solicitations for client employers located or domiciled in Ohio; and

(d) The AEO or the PEO has fifty or fewer shared employees employed or domiciled in Ohio on any given day. For purposes of this paragraph, an AEO or a PEO is not domiciled outside of Ohio if a commonly owned or otherwise related corporate entity is domiciled in Ohio or maintains an office in the state.

(5) The administrator may demand security of the limited registration AEO or the limited registration PEO pursuant to sections 4125.05 and 4133.07 of the Revised Code.

(E) The bureau will maintain a list of AEOs, PEOs, and PEO reporting entities registered under this rule that is readily available to the public.

(F) The following acts are not permitted:

(1) Beginning on and after January 1, 2022, an AEO, that is currently registered in Ohio under this rule, owning, co-owning, or commonly controlling an AEO, a PEO, or a PEO reporting entity that is registered in Ohio under this rule, and

(2) Beginning on and after January 1, 2022, a PEO or a PEO reporting entity, that is currently registered in Ohio under this rule, owning, co-owning, or commonly controlling an AEO that is registered in Ohio under this rule.

(G) Except to the extent necessary for the administrator to administer the statutory duties of the administrator and for employees of the state to perform their official duties, all records, reports, client lists, and other information obtained from an AEO, a PEO or a PEO reporting entity under this rule are confidential and are considered trade secrets and will not be published or open to public inspection.

View Appendix

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30, 4123.05, 4125.02, 4133.02
Amplifies: 4125.05, 4133.07
Five Year Review Date: 6/1/2028
Prior Effective Dates: 1/5/2019, 1/13/2022
Rule 4123-17-15.4 | Financial mandates.
 

(A) An AEO, a PEO, or a PEO reporting entity shall prepare financial statements in accordance with generally accepted accounting principles and submit them electronically for registration and registration renewal pursuant to sections 4125.05 and 4133.08 of the Revised Code.

(1) The financial statements shall be audited by an independent certified public accountant authorized to practice in the jurisdiction in which that accountant is located.

(a) The resulting report of the auditor is not to include either of the following:

(i) A qualification or disclaimer of opinion as to adherence to generally accepted accounting principles; or

(ii) A statement expressing substantial doubt about the ability of the AEO, the PEO, or the PEO reporting entity to continue as a going concern.

(b) If an AEO or a PEO does not have at least twelve months of operating history on which to base financial statements, the financial statements are to be reviewed by a certified public accountant.

(2) A PEO reporting entity may submit a combined or consolidated financial statement for its member PEOs to satisfy this paragraph. If the combined or consolidated financial statement includes entities that are not PEOs or that are not in the PEO reporting entity, the controlling entity of the PEO reporting entity that is submitting the consolidated or combined financial statement shall guarantee that the PEOs of the PEO reporting entity have completely satisfied paragraph (B) of this rule.

(B) An AEO, a PEO, or a PEO reporting entity is obligated to maintain positive working capital at initial or annual registration, as reflected in the financial statements submitted to the bureau of workers' compensation under paragraph (A)(2)(j) of rule 4123-17-15.2 of the Administrative Code. If a deficit in working capital is reflected in the financial statements submitted to the bureau, the AEO, the PEO, or the PEO reporting entity shall:

(1) Submit to the bureau a quarterly financial statement for each calendar quarter during which there is a deficit in working capital, accompanied by an attestation of the chief executive officer, president, or other individual who serves as the controlling person of the AEO, the PEO, or the PEO reporting entity that all wages, taxes, workers' compensation premiums, and employee benefits have been paid by the AEO, the PEO, or members of the PEO reporting entity.

(2) Obtain a bond, irrevocable letter of credit, or securities with a minimum market value in an amount sufficient to cover the deficit in working capital. Such security is to be held by a depository designated by the administrator of workers' compensation to secure payment by the AEO, the PEO, or the PEO reporting entity of all taxes, wages, benefits, or other entitlements due or otherwise pertaining to shared employees, if the AEO, the PEO, or the PEO reporting entity does not make those payments when due.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30, 4123.05, 4125.02, 4133.02
Amplifies: 4125.05, 4125.051, 4133.07, 4133.08
Five Year Review Date: 6/1/2028
Prior Effective Dates: 11/22/2004
Rule 4123-17-15.5 | Self-insured AEOs and PEOs.
 

(A) An AEO or a PEO registered with the bureau of workers' compensation under rule 4123-17-15.2 of the Administrative Code may apply to pay compensation directly as a self-insuring employer.

(1) The AEO or the PEO must meet all eligibility criteria set forth in section 4123.35 of the Revised Code.

(a) The AEO or the PEO will provide five years of financial records as set forth in division (B)(1)(e) of section 4123.35 of the Revised Code. The administrator of workers' compensation cannot waive this mandate.

(b) Worksite employees of an AEO and shared employees of a PEO will be considered employees of the AEO or the PEO for the purposes of meeting the provisions of division (B)(1)(a) of section 4123.35 of the Revised Code only if the following criteria are met:

(i) An AEO will demonstrate to the bureau that it is in compliance with all of the following:

(a) The duties of organization regarding worksite employees set forth in section 4133.03 of the Revised Code, as amplified in paragraph (D) of rule 4123-17-15 of the Administrative Code;

(b) The provisions of section 4133.07 of the Revised Code; and

(c) The provisions of section 4133.10 of the Revised Code, as amplified by paragraphs (A)(3) and (A)(4) of rule 4123-17-15.1 of the Administrative Code;

(ii) A PEO will demonstrate to the bureau that it is in compliance with all of the following:

(a) The duties of organization regarding shared employees set forth in section 4125.03 of the Revised Code, as amplified by paragraphs (C) and (E) of rule 4123-17-15 of the Administrative Code;

(b) The provisions of section 4125.05 of the Revised Code; and

(c) The provisions of section 4125.07 of the Revised Code, as amplified by paragraphs (A)(3) and (A)(4) of rule 4123-17-15.1 of the Administrative Code.

(iii) Client employer wages.

(a) For an AEO, all of the client employers wages for worksite employees are paid and reported under the tax identification number of the client employer for federal tax reporting purposes as stated in section 4133.03 of the Revised Code and paragraph (D) of rule 4123-17-15 of the Administrative Code.

(b) For a PEO, all of the client employer's wages are paid and reported under the tax identification number of the PEO for federal tax reporting purposes.

(2) Any AEO or PEO application for self-insured status will be referred to the self-insured review panel pursuant to paragraph (F)(1) of rule 4123-19-14 of the Administrative Code.

(3) Any application to add an AEO or a PEO to an existing self-insured entity will be referred to the self-insured review panel pursuant to paragraph (F)(1) of rule 4123-19-14 of the Administrative Code.

(B) An AEO or PEO granted the privilege of self-insured status must do all of the following:

(1) If determined necessary by the bureau, furnish security, in the amount, and in the form of a letter of credit from a federally insured financial institution or other security approved by the bureau, as provided by paragraphs (F), (G), and (H) of rule 4123-19-03 of the Administrative Code.

(a) The amount of security deemed necessary will be as determined by the bureau.

(b) The AEO or the PEO is not permitted to use an assurance organization to meet its security obligations under this rule.

(c) The bureau may, pursuant to paragraph (N) of rule 4123-19-03 of the Administrative Code, demand the AEO or the PEO to furnish additional security within thirty days of receiving the notice issued pursuant to this rule.

(2) Submit to the bureau every two years, or upon the bureau's request, an actuarial estimate of the unpaid loss and loss adjustment expense liabilities of the AEO or the PEO performed by an independent actuary with a fellow of the society of actuaries or casualty actuary society credential.

(3) Make contribution to the self-insuring employers' guaranty fund as set forth in rule 4123-19-15 of the Administrative Code. For purposes of this rule, the premium as reported on the total of the last two full six-month semi-annual payroll reports will include the premium of the AEO or the PEO and all its client employers.

(4) Pay all assessments levied upon self-insuring employers under rule 4123-17-32 of the Administrative Code.

(5) Reimburse the bureau for disabled workers' relief fund payments on claims for which the AEO or the PEO, or its client employers are employer of record, pursuant to paragraph (B) of rule 4123-17-29 of the Administrative Code.

(6) Make a quarterly report to the bureau that details the active clients, all claims, and the claim reserves for each claim of the AEO or the PEO.

(C) For purposes of this rule, "paid compensation" means all amounts paid by the AEO or the PEO and its client employers for living maintenance benefits, all amounts for compensation paid pursuant to sections 4121.63, 4121.67, 4123.56, 4123.57, 4123.58, 4123.59, 4123.60 and 4123.64 of the Revised Code, all amounts paid as wages in lieu of such compensation, all amounts paid in lieu of such compensation under a nonoccupational accident and sickness program fully funded by the AEO or the PEO, or its client employers, and all amounts paid by an AEO or a PEO and its client employers for a violation of a specific safety standard pursuant to Section 35 of Article II, Ohio Constitution and section 4121.47 of the Revised Code. Any reimbursement received from the surplus fund pursuant to section 4123.512 of the Revised Code by the AEO or the PEO, or its client employers for any such payments or compensation paid is to be applied to reduce the amount of paid compensation reported in the year in which the reimbursement is made. Any amount recovered by the AEO or the PEO, or its client employers under section 4123.931 of the Revised Code and any amount that is determined not to have been payable to a claimant in any final administrative or judicial proceeding will be deducted, in the year collected, from the amount of paid compensation reported.

(1) For an AEO or a PEO that is a self-insuring employer for which paragraph (I) of rule 4123-17-32 of the Administrative Code is applicable, paid compensation includes any amounts paid by the state insurance fund for claims directly attributable to the AEO or the PEO and any client employers of the AEO or the PEO. In determining the applicability of paragraph (I) of rule 4123-17-32 of the Administrative Code to an AEO or a PEO, the bureau will use the date on which the AEO or the PEO was added to the self-insured policy if such date is after the effective date of the self-insured policy.

(2) If a client employer enters into a new AEO agreement with an AEO, or a new PEO agreement with a PEO, that is self-insured risk which paragraph (I) of rule 4123-17-32 of the Administrative Code is applicable, paid compensation includes any amounts paid by the state insurance fund for claims directly attributable to that client employer.

(D) An AEO or a PEO granted the privilege of self-insured status cannot:

(1) Enter into AEO agreements or PEO agreements to provide workers' compensation coverage through the state insurance fund; or

(2) Enter into a partial-lease agreement.

(E) An AEO or a PEO granted the privilege of self-insured status shall do all of the following:

(1) Prior to entering into an AEO or a PEO agreement with a client employer, provide written notice to the client employer that the submission of a lease termination notice form by the AEO or the PEO to the administrator will require the AEO or the PEO to report all information necessary for the administrator to develop a state fund experience modification factor for each client employer involved in the lease termination.

(2) The self-insured AEO or the self-insured PEO will submit all necessary information by the date set by the administrator, and in a format determined by the administrator. This information is to be submitted each year following the submission of a lease termination notice form by the AEO or the PEO, for as many years as deemed necessary by the administrator to develop a state fund experience modification factor for each client employer involved in the lease termination. The self-insured AEO or the self-insured PEO may have to submit additional information to the administrator if the administrator determines that additional information is needed to develop a state fund experience modification factor for each client employer involved in the lease termination.

(3) A self-insured AEO or a self-insured PEO that submits a lease termination notice form to the administrator will provide the following information to the administrator within thirty calendar days from the lease termination date for each client employer involved in the lease termination:

(a) The payroll of each client employer involved in the lease termination, organized by classification code and policy year;

(b) The medical and indemnity costs of each client employer involved in the lease termination, organized by claim; and

(c) Any other information the administrator may need to develop a state fund experience modification factor for each client employer involved in the lease termination.

(4) The administrator may revoke or refuse to renew the privilege of operating as a self-insuring employer if an AEO or a PEO fails to provide the information requested by the administrator under this rule.

(F) The administrator will use the information provided under this rule to develop a state fund experience modification factor for each client employer involved in a lease termination with a self-insured AEO or a self-insured PEO.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30, 4123.05, 4123.35, 4125.02, 4125.05, 4133.02, 4133.07
Amplifies: 4123.35, 4125.05, 4133.07
Five Year Review Date: 6/1/2028
Prior Effective Dates: 11/22/2004, 3/26/2017, 1/5/2019
Rule 4123-17-15.6 | Client employer information.
 

(A) An AEO or a PEO shall provide a list of all of the following information to the client employer upon the written request of the client employer:

(1) All premiums and payroll associated with that client employer;

(2) All workers' compensation claims, and the compensation and benefits paid, and reserves established for each claim; and

(3) Any other information available to the AEO or the PEO from the bureau of workers' compensation regarding that client employer.

(B) The AEO or the PEO will provide the information pursuant to paragraph (A) of this rule in writing to the requesting client employer within forty-five days after receiving a written request from the client employer. An AEO or a PEO has provided this information to the client employer when:

(1) The information is received by the United States postal service; or

(2) When the information is personally delivered, in writing, directly to the client employer. For purposes of this rule, a communication sent via electronic mail is personally delivered at the time the communication was sent by the AEO or the PEO to a valid electronic mail address for the client employer.

(C) If an AEO or a PEO fails to comply with a client employer's written request for information, the client employer may submit a complaint to the bureau.

(1) The bureau will investigate the complaint to determine whether the AEO or the PEO has complied with this rule.

(2) If the bureau finds the AEO or the PEO has failed to comply with this rule:

(a) The bureau will provide the requested information to the client employer. All administrative costs associated with investigation and providing the information to the client employer will be assessed to the AEO or the PEO; and

(b) The bureau will provide the client employers of the AEO or the PEO with notification of the failure to comply with the rule and advise the client employers of their ability to request information under this rule.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30, 4123.05, 4125.02, 4133.02
Amplifies: 4125.03, 4133.03
Five Year Review Date: 6/1/2028
Prior Effective Dates: 2/17/2014
Rule 4123-17-15.7 | Denial or revocation of AEO or PEO registration.
 

(A) The administrator of workers' compensation shall deny or revoke the registration of an AEO, a PEO, or a PEO reporting entity if it fails to comply with the provisions of rule 4123-17-15.4 of the Administrative Code.

(B) The administrator may deny or revoke the registration of an AEO, a PEO, or a PEO reporting entity upon finding that the AEO, the PEO, or the PEO reporting entity has done any of the following:

(1) Obtained or attempted to obtain registration through misrepresentation, misstatement of a material fact, or fraud;

(2) Misappropriated any funds of a client employer;

(3) Used fraudulent or coercive practices to obtain or retain business or demonstrated financial irresponsibility;

(4) Failed to appear, without reasonable cause or excuse, in response to a subpoena lawfully issued by the administrator; or

(5) Failed to comply with the provisions of rules 4123-17-15 to 4123-17-15.5 of the Administrative Code.

(C) Concurrent with, or upon, the denial or revocation of the registration of an AEO, a PEO, or a PEO reporting entity, the administrator may deny or revoke the registration of any AEO, PEO, or PEO reporting entity, that is majority owned or commonly controlled by the same entity, parent, or controlling person.

(D) An AEO or a PEO may appeal a denial or revocation of status under this rule pursuant to the administrative hearing procedure set forth in Chapter 119. of the Revised Code.

(E) The administrator's decision to deny or revoke an AEO's registration or a PEO's registration is stayed pending the exhaustion of all administrative appeals by the AEO or the PEO. The bureau of workers compensation may notify client employers of the administrators decision to deny or revoke the registration of the AEO or the PEO upon issuance of the administrator's decision, provided the bureau also notifies client employers that the AEO or the PEO has the right to appeal the administrators decision.

(F) Upon revocation of the registration of an AEO or a PEO, each client employer associated with that AEO or PEO will file payroll reports and pay workers' compensation premiums directly to the administrator on its own behalf at a rate determined by the administrator based solely on the claims experience of the client employer.

(G) If pursuant to this rule the administrator has denied or revoked the registration of an AEO or a PEO, or a PEO reporting entity, then any of the following are ineligible to reapply as an AEO or a PEO, or a PEO reporting entity for a period of two years from the date of denial or revocation of the registration, and rescission of the PEO or PEO reporting entity's status as a coemployer:

(1) The former AEO, the former PEO, or the former PEO reporting entity; or

(2) Any applicant that is majority owned, or commonly controlled, by the same entity, parent, or controlling person of the former AEO, former PEO, or former PEO reporting entity.

(H) When an employer contacts the bureau to determine whether a particular AEO or PEO is registered, if the administrator has denied or revoked that AEO's registration or that PEO's registration, and if all administrative appeals are not yet exhausted when the employer inquires, the appropriate bureau personnel will inform the inquiring employer of the denial, revocation, or rescission and the fact that the AEO or the PEO has the right to appeal the administrator's decision.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30, 4123.05, 4125.02, 4133.02
Amplifies: 4125.051, 4125.06, 4133.08, 4133.09
Five Year Review Date: 6/1/2028
Prior Effective Dates: 1/5/2019, 1/13/2022
Rule 4123-17-16 | Penalties: late payment and reporting.
 

(A) Definitions.

As used in this rule:

(1) "Annual payroll report" means the report of the employer's actual payroll expenditures submitted pursuant to section 4123.26 of the Revised Code for private employers, section 4123.41 of the Revised Code for public employers, and under rule 4123-17-14 of the Administrative Code.

(2) "Payments" means premiums, administrative costs, assessments, fines or monies otherwise due to any fund administered by the bureau of workers' compensation, including amounts due for retrospective rating.

(B) Premium payments are due by the date indicated on the invoice provided by the bureau pursuant to rule 4123-17-14 of the Administrative Code. Other payments and reports pursuant to Chapter 4123. of the Revised Code will be considered late if not received by the bureau on the due date specified by statute or administrative rule implementing such statute. If statute and rule do not specify a date for a payment, such payments will be considered late if not received by the bureau by the due date on the invoice issued by the bureau.

(1) The administrator of workers' compensation may establish a grace period during which a penalty will not be assessed on late payments or late reporting.

(2) If the bureau imposes a lapse in coverage on an employer's policy for failure to make premium payments within a grace period established by the administrator pursuant to paragraph (B)(1) of this rule, such lapse will be effective from the first day of the month which falls nearest the due date of the payment.

(C) Penalties for late payments.

(1) If an employer fails to pay premium and assessments when due, the administrator may assess a penalty at the interest rate established by the state tax commissioner pursuant to section 5703.47 of the Revised Code.

(2) If an employer recognized by the administrator as an alternate employer organization as defined in section 4133.01 of the Revised Code, or a professional employer organization, as defined in section 4125.01 of the Revised Code, fails to make timely payment of premiums and assessments in accordance with rule 4123-17-14 of the Administrative Code, the administrator will revoke the alternate employer organization's registration or the professional employer organizations registration pursuant to rule 4123-17-15.7 of the Administrative Code.

(D) Penalties for failure to file or pay amounts due under the annual payroll report.

(1) If an employer fails to file or pay amounts due under the annual payroll report within the grace period established by the administrator pursuant to paragraph (B)(1) of this rule:

(a) The employer will be removed from all rating plans and discount programs for the policy year immediately following the policy year to which the annual payroll report pertains. Unless otherwise specified in the rules of the program, such employer will be base-rated or experience-rated, as determined by the expected losses of the employer pursuant to rules 4123-17-33 and 4123-17-34 of the Administrative Code, and

(b) The premium and assessments due from the employer for the policy year to which such report pertains will be calculated based on the estimated payroll of the employer used in calculating estimated premium due, increased by ten per cent.

(2) The bureau will not impose a lapse in coverage on an employer that is current with its estimated premium payments for failure to file an annual payroll report for the preceding policy year.

(E) Certification of past-due amounts to the attorney general.

Pursuant to sections 131.02 and 4123.323 of the Revised Code, the bureau will certify past due amounts to the attorney general according to the following schedule:

(1) Premium payments: seventy-five days after the annual payroll report for the policy year to which the premium payments pertain is due under rule 4123-17-14 of the Administrative Code.

(2) Penalties for failure to make estimated premium payments: seventy-five days after the annual payroll report for the policy year to which the premium payments pertain is due under rule 4123-17-14 of the Administrative Code.

(3) All other assessments and penalties thereon: forty five days after the due date set forth in paragraph (B) of this rule.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.32, 4123.34, 4123.36
Five Year Review Date: 6/1/2028
Prior Effective Dates: 7/1/1971, 12/14/1992
Rule 4123-17-17 | Auditing and adjustment of payroll reports.
 

(A) Every employer amenable to the workers' compensation law shall keep, preserve and maintain complete records showing in detail all expenditures for payroll reportable to Ohio and the division of such expenditures in the various divisions and classifications of the employer's business. If an employer elects under section 4123.292 of the Revised Code to obtain other-states' coverage, the employer shall also keep records of all payroll reported to the other-states' insurer for work performed outside of Ohio. Both types of payroll records shall be preserved for at least five years after the respective time of the transaction upon which such records are based.

(B) All books, records, papers, and documents reflecting upon the amount and the classifications of the payroll expenditures of an employer shall be kept available for inspection at any time by the bureau of workers' compensation or any of its assistants, agents, representatives or employees. If any employer fails to keep, preserve and maintain such records and other information reflecting upon payroll expenditures, or fails to make such records and information available for inspection, or fails to furnish the bureau or any of its assistants, agents, representatives or employees, full and complete information in reference to expenditures for payroll when such information is requested, the bureau may determine upon such information as is available to it the amount of premium due from the employer and its findings shall constitute prima facie evidence of the amount of premium due from the employer.

(C) The bureau shall have the right at all times to inspect, examine or audit any or all books, records, papers, documents and payroll of an employer for the purpose of verifying the correctness of reports made by employers as required by law.

(1) The bureau shall have the right to make adjustments as to classifications, allocation of wage expenditures to classifications, amount of wage expenditures, premium rates or amount of premium.

(2) Except as provided in rules 4123-17-14 and 4123-17-28 of the Administrative Code, adjustments in an employer's account which result in changes to the amount of premium due from an employer for a policy year shall be limited to the annual or adjustment periods ending within twenty-four months immediately prior to:

(a) The date when such error affecting the reports and the premium are brought to the attention of the bureau by an employer through written application for adjustment, or

(b) The date that the bureau provides written notice to the employer of the bureau's intent to inspect, examine, or audit the employer's records.

(D) Where the bureau has assigned two or more classifications for an employer's operations, the employer shall keep an appropriate record showing a correct and verifiable segregation of all payroll into such classifications. If it is found that the employer has failed to keep such record, the part of the payroll which cannot be reasonably determined by the bureau as belonging to any other classification shall be placed by the bureau under the assigned classification having the highest rate, and the employer will be assessed premium accordingly.

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.30
Amplifies: 4123.24, 4123.26, 4123.29, 4123.34, 4123.41
Five Year Review Date:
Prior Effective Dates: 7/1/1962, 12/11/1992
Rule 4123-17-19 | Employer contribution to the marine industry fund.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to establish contributions made to the marine industry fund by employers pursuant to sections 4121.121 and 4131.14 of the Revised Code. The administrator hereby sets the premium rates per one hundred dollar unit of payroll to be effective July 1, 2023 as indicated in the appendix to this rule.

View Appendix

Last updated July 27, 2023 at 8:41 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.34, 4123.14
Five Year Review Date:
Prior Effective Dates: 7/1/1990, 7/1/2005, 7/1/2007, 7/1/2011, 7/1/2015, 7/1/2016, 7/1/2020, 7/1/2022
Rule 4123-17-20 | Employer contribution to the coal-workers pneumoconiosis fund.
 

The administrator of workers' compensation, with the advice and consent of the workers' compensation board of directors, has authority to establish contributions made to the coal-workers pneumoconiosis fund by employers pursuant to sections 4121.121 and 4131.04 of the Revised Code. The administrator hereby sets the premium rates per one hundred dollar unit of payroll, as indicated in the appendix to this rule.

View Appendix

Last updated July 27, 2023 at 8:41 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.34, 4131.04
Five Year Review Date:
Prior Effective Dates: 7/1/2011, 8/25/2011, 7/1/2020, 7/1/2021, 7/1/2022
Rule 4123-17-22 | Traveling expense.
 

Where traveling salesmen or other employees, who travel in the course of their employment, are required to pay their traveling expenses out of their remuneration, the employer, in submitting payroll reports of the earnings of such employees, may deduct from the remuneration an amount representing actual traveling expenses, not exceeding, however, an amount equal to one-third of the remuneration, provided said employer maintains complete detailed records disclosing said expenditures.

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date:
Prior Effective Dates: 7/1/1962
Rule 4123-17-23 | Duties outside the state.
 

(A) The entire remuneration of employees whose employment involves activities both within and outside the borders of Ohio, and where the supervising office of the employer is located in Ohio, shall be included in the payroll report. However, if the employer elects to obtain other-states' coverage under section 4123.292 of the Revised Code directly through an other-states' insurer the employer shall report payroll as set forth in paragraph (I) of rule 4123-17-14 of the Administrative Code.

(B) The remuneration of employees of other than Ohio employers, who have entered into a contract of employment outside of Ohio to perform transitory services in interstate commerce only, both within and outside of the boundaries of Ohio, shall not be included in the payroll report.

(C) The bureau of workers' compensation respects the extraterritorial right of the workers' compensation insurance coverage of an out-of-state employer for its regular employees who are residents of a state other than Ohio while performing work in the state of Ohio for a temporary period not to exceed ninety days. While temporarily within this state the rights of the employee and the employee's dependents under the laws of the other state are the exclusive remedy against the employer on account of injury, disease or death pursuant to division (H)(5) of section 4123.54 of the Revised Code and remuneration for such employees shall not be included in the payroll report. However, if a temporary period exceeds ninety consecutive days the out-of-state employer shall include in the payroll report the remuneration for work the employees perform in Ohio beyond that ninety day period.

(D) Employees hired to work specifically in Ohio must be reported for workers' compensation insurance under the Ohio fund, regardless of where the contracts of hire were entered.

(E) When an Ohio employer hires an employee to perform transitory work outside of Ohio and the employee is not covered by the workers' compensation laws of the state of residence for claims arising outside that state because the contract of employment was not entered into in the state of residence, the employer and his employee, if the employment relationship maintains sufficient contacts with the Ohio location to be covered by Ohio workers' compensation law, may mutually agree to be bound by the workers' compensation laws of the state of Ohio by executing form C-110, or mutually agree to be bound by the workers' compensation law of some other state by executing form C-112, such forms to be obtained from and filed with the bureau of workers' compensation within ten days after execution.

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Rule 4123-17-24 | Other states coverage policy.
 

(A) Definitions.

For purposes of this rule:

(1) "Other states coverage policy (OSCP)" is the policy offered by the bureau of workers' compensation under section 4123.292 of the Revised Code to provide optional coverage to eligible Ohio employers for workers' compensation exposures in states other than Ohio.

(2) "Contracting carrier" means the insurer providing other states coverage through the bureau.

(3) "Limited other states coverage" is insurance coverage for eligible Ohio employers who have employment relationships localized in Ohio but whose employees have incidental exposures in jurisdictions outside Ohio.

(4) "Other states coverage" is insurance coverage for eligible Ohio employers who have regular or full time employment exposure in jurisdictions outside of Ohio.

(B) OSCP application.

(1) An employer wishing to obtain an OSCP will complete and submit an application to the bureau, and if the employer has an existing other states policy, the employer will provide any declaration page or certificate of coverage of any existing other states policy. Declaration pages or certificates of coverage for previous policy years may be requested as deemed appropriate by the bureau.

(2) The bureau will only process a complete application, and no application will be deemed complete until all information requested by the bureau in connection with the application is supplied.

(3) The bureau may make reasonable inspections of an applicant's place of business and of any records applicable to ensuring proper classification code assignment to the policy or to review loss prevention or safety programs prior to reaching a decision regarding an application for coverage. The bureau will provide advanced notice to the employer of any such inspection.

(4) Only employers meeting the following criteria are eligible for an OSCP:

(a) The employer is headquartered, primarily located, or has a history of predominant business operations in Ohio;

(b) The employer has an active state fund workers' compensation policy with the bureau;

(c) The employer cannot have cumulative lapses in workers' compensation coverage in excess of forty days within the prior twelve months; and

(d) The employer's Ohio policy cannot have past due balances at the time of application or renewal.

(5) The bureau will establish underwriting guidelines for determining whether to approve or deny an application. In addition to the criteria set forth in paragraph (B)(4) of this rule, the bureau's underwriting guidelines may consider the following:

(a) The applicant's history with the bureau, including compliance with applicable workers' compensation laws and rules, payment of premiums and assessments, claims history, safety record, and experience ratings; and

(b) The applicant's history with coverage through any insurer for worker's compensation in any jurisdiction other than Ohio, including premium payment records, claims history, safety record, and experience modification history, if any.

(6) The following employers are not eligible for an OSCP:

(a) Self-insuring employers providing compensation and benefits pursuant to section 4123.35 of the Revised Code;

(b) Temporary employment agencies or other staffing entities;

(c) Professional employer organizations as defined in Chapter 4125. of the Revised Code, and each of the professional employer organization's client employers; and

(d) Alternate employer organizations as defined in Chapter 4133. of the Revised Code, and each of the alternate employer organizations client employers.

(7) The bureau has the authority, in the administrator of workers' compensation's discretion, to approve or deny an OSCP application. The decision of the administrator is final.

(a) In the event that an employer is denied an OSCP, the bureau will provide written documentation of the reason for denial; and

(b) An employer may reapply once the reason for denial is remedied.

(C) Premium payment and policy issuance.

(1) An employer whose application for coverage is approved by the bureau will receive a quote for the cost of coverage. If the employer elects to obtain coverage, the bureau will issue an OSCP only after the following:

(a) The bureau's receipt of premium payment for the OSCP; and

(b) If an employer has previously had a policy covering its exposure out of state, submission of proof of cancellation of the existing policy or the expiration date of the previous policy.

(2) Coverage under an OSCP will be effective when the OSCP is issued.

(a) The bureau will issue the policy within five business days of receipt of premium if cancellation notices and other information necessary from the policyholder to issue the OSCP are provided; and

(b) Coverage becomes effective per the effective date of the policy as issued by the contracting carrier.

(D) OSCP renewal.

(1) An employer wishing to renew its OSCP may complete the renewal application, which will be provided by the bureau. The bureau will establish a deadline for the renewal application.

(2) If the renewal application is not completed by an employer, the renewal quote will be based upon the previous policy years information.

(3) The bureau will non-renew an employer's OSCP if the employer is not eligible for coverage under this rule at the time of renewal.

(4) The premium for the OSCP renewal period has to be received by the bureau prior to the expiration of the previous policy period.

(5) If the renewal premium is not received by the expiration of the previous policy, notice of the policy cancellation for non-payment will be sent to the insured employer under the laws and procedures of the jurisdiction from which coverage is provided. If the bureau received an insured employer payment late, the bureau may, in the administrator's discretion, reinstate the coverage or may require the employer to submit a new OSCP application.

(6) The bureau has the authority, in the administrator's discretion, to non-renew an employer's OSCP. The decision of the administrator is final.

(E) Audits and inspection.

(1) An OSCP will expire per the terms of the policy issued by the contracting carrier, unless otherwise canceled as set forth in this rule.

(2) An employer with an OSCP will have to complete a final audit at the conclusion of each OSCP term and upon cancellation pursuant to the terms of the OCSP.

(3) In the event of a claim filed in a jurisdiction outside Ohio, the bureau may make reasonable inspection of an applicant's place of business and of any records necessary to secure information for the purpose of determining compensability of such claim.

(4) Any audit will be conducted in accordance with rule 4123-17-17 of Administrative Code.

(5) Adjustments to premium may be made based on the results of any audit. The employer will have to pay any balance due within the timelines established by the bureau.

(6) If the employer refuses or otherwise fails to cooperate with an audit by the bureau, the bureau may estimate the insured's payroll. Any estimated payroll pursuant to this section may result in an adjustment of premium.

(7) In the event of an audit dispute, the bureau will make reasonable efforts with the insured to resolve the disputed findings.

(8) If resolution between the bureau and the insured cannot be made, the audit findings can be appealed to the extent allowable under the laws and procedures of the jurisdiction for which coverage is being provided.

(F) Policy cancellation.

(1) An OSCP may be canceled for any of the following reasons:

(a) At the written request of the employer;

(b) Employer misrepresentation regarding its operations;

(c) Fraud committed by, or for the benefit of, the employer;

(d) Employer failure to complete a final audit or pay any amounts due as a result of a final audit;

(e) Any past due balance owed for the OSCP;

(f) Refusal on the part of the insured to permit reasonable audits or inspections; or

(g) Any reason the contracting carrier is authorized to cancel a policy, as established by the laws of the jurisdiction for which coverage is being provided.

(2) An OSCP may be canceled under the laws and procedures of the jurisdiction for which coverage is being provided.

(a) Notice of cancellation will be provided in accordance with the laws and procedures of the jurisdiction for which coverage is being provided; and

(b) A policy cancellation can be appealed to the extent allowable under the laws and the procedures of the jurisdiction for which coverage is being provided.

(G) Assignment of payroll.

(1) If an employer is issued an OSCP for limited other states coverage, the bureau may assign payroll in the event of a claim to the jurisdiction where the claim is filed. The payroll amount will not exceed one hundred per cent of the injured workers' wages for one year.

(2) The assignment of payroll may result in a premium adjustment for the OSCP. The employer will have to pay any balance due within the timelines established by the bureau.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4121.12, 4121.121, 4123.292
Five Year Review Date: 6/1/2028
Rule 4123-17-25 | Military and naval service.
 

The moneys given by employers to employees while engaged in active military or naval service of the United States of America shall be excluded from the payroll reports which said employers are required to submit to the bureau of workers' compensation for premium purposes unless said employees are also required to render services to said employers while thus engaged in active military or naval service.

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date:
Prior Effective Dates: 7/1/1962
Rule 4123-17-26 | Minimum annual administrative charge.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to calculate contributions to the administrative cost fund by employers pursuant to sections 4121.121, 4123.341, and 4123.342 of the Revised Code. The administrator hereby establishes that in cases where an employer reports no payroll for a payroll reporting period the employer shall pay a minimum annual administrative charge at a rate of one hundred twenty dollars annually. In cases where an employer reports payroll resulting in a premium of less than the minimum administrative charge, the employer shall pay assessments associated with the premium in addition to the one hundred twenty dollar charge.

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.341, 4123.342
Five Year Review Date:
Prior Effective Dates: 7/1/1962
Rule 4123-17-27 | Protest of an employer's experience.
 

A protest of an employer's experience is to be submitted in writing, which includes by e-mail. Only the employer or a representative with a permanent authorization from that employer can file a protest. A protest will be considered on its merits only if the protest is timely received by the bureau of workers' compensation. A protest is timely filed if the date of receipt by the bureau is within two years of the initial effective date of the basic rate(s) on which the protested experience is predicated.

Last updated July 14, 2023 at 1:20 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.32, 4123.34
Five Year Review Date: 6/1/2028
Prior Effective Dates: 12/14/1992, 9/23/2013
Rule 4123-17-29 | Disabled workers' relief fund; employers' assessments and self-insurers' payments.
 

(A) State fund employers.

(1) In order to make disabled workers' relief fund (DWRF) payments to claimants having dates of injury or disability prior to January 1, 1987, assessments shall be levied in the following manner for so long as payments to such claimants are required:

(a) Private state fund employers: zero cents per one-hundred-dollar unit of payroll, effective July 1, 2016;

(b) Public employer taxing districts: zero cents per one-hundred-dollar unit of payroll, effective January 1, 2016;

(c) Public employer state agency: one cent per one-hundred-dollar unit of payroll, effective July 1, 2022.

These assessments shall be billed at the same time state insurance fund premiums are billed and payments shall be credited to the DWRF.

(2) In order to make DWRF payments to claimants having dates of injury or disability on or after January 1, 1987, assessments shall be levied in the following manner for so long as payments to such claimants are required:

(a) Private state fund employers: zero per cent of premium, computed at basic rate, effective July 1, 2015;

(b) Public employer taxing districts: zero per cent of premium, computed at basic rate, effective January 1, 2015;

(c) Public employer state agency: zero per cent of premium, computed at basic rate, effective July 1, 2015;

These assessments shall be billed at the same time state insurance fund premiums are billed and payments shall be credited to the DWRF.

(B) Self-insuring employers.

(1) Each self-insuring employer shall reimburse the bureau for DWRF payments made in claims in which it is the employer of record, without regard to the date the employer was granted the privilege to pay compensation directly, for all DWRF payments made on or after August 22, 1986.

(2) Self-insuring employers shall be billed on a semi-annual basis for the DWRF payments made pursuant to this rule.

(3) Upon default and a finding of noncompliance by the administrator of workers' compensation, reimbursement shall be made from the self-insuring employers' guaranty fund.

Last updated July 1, 2022 at 1:32 PM

Supplemental Information

Authorized By: 4123.05, 4121.30, 4121.13, 4121.121, 4121.12, 4121.11
Amplifies: 4123.411, 4123.414, 4123.413
Five Year Review Date:
Prior Effective Dates: 8/22/1986 (Emer.), 7/1/2019
Rule 4123-17-30 | Payroll limitations for corporate officers, sole proprietors, an individual incorporated as a corporation with no employees, members of partnerships, and family farm corporations.
 

The administrator of workers' compensation, with the advice and consent of the workers' compensation oversight commission, has authority to establish the total payroll reportable by employers pursuant to sections 4121.12 and 4123.29 of the Revised Code. The administrator hereby sets the total payroll limitations for executive officers of corporations, sole proprietors, members of partnerships, an individual incorporated as a corporation with no employees, and officers of family farm corporations as provided in this rule.

(A) For executive officers of corporations, the payroll reportable shall be the actual payroll received by the executive officers of the corporation, but not less than an average weekly wage equal to fifty per cent of the statewide average weekly wage as defined in division (C) of section 4123.62 of the Revised Code, but shall not exceed an average weekly wage equal to one hundred fifty per cent of the statewide average weekly wage as defined in division (C) of section 4123.62 of the Revised Code. The minimum reportable payroll for executive officers of corporations shall apply only to active executive officers of corporations. As used in this rule, "active executive officer" means an officer engaged in the decision making and day to day operations of the corporation.

(B) For sole proprietors, members of partnerships, an individual incorporated as a corporation with no employees, and officers of family farm corporations who elect to include themselves as employees under the workers' compensation act and comply with rule 4123-17-07 of the Administrative Code, the payroll reportable shall be the actual payroll received by the sole proprietor, member of partnership, an individual incorporated as a corporation, and officer of a family farm corporation, but not less than an average weekly wage equal to fifty per cent of the statewide average weekly wage as defined in division (C) of section 4123.62 of the Revised Code, nor more than an average weekly wage equal to one hundred fifty per cent of the statewide average weekly wage as defined in division (C) of section 4123.62 of the Revised Code.

(C) This rule shall be effective for all payroll reportable on or after July 1, 2006.

Supplemental Information

Authorized By: 4121.12, 4121.13, 4121.30, 4123.05
Amplifies: 4123.01, 4123.24, 4123.26, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1993, 7/1/1994
Rule 4123-17-32 | Self-insuring employer assessment based upon paid compensation.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to determine and levy against self-insuring employers amounts to be paid to support the safety and hygiene fund, the administrative cost fund, the portion of the surplus fund that is mandatory and the portion of the surplus fund used for claims reimbursement for self-insuring employers under division (H) of section 4123.512 of the Revised Code, pursuant to sections 4121.12, 4121.37, 4121.66, 4123.34, 4123.342, and 4123.35 of the Revised Code in conjunction with rule 4123-19-01 of the Administrative Code. The administrator hereby sets the self-insuring employer assessments to be effective July 1, 2023, for the period July 1, 2023, to June 30, 2024, payable in two equal remittances by February 28, 2024, and August 31, 2024, as follows:

(A) The assessments shall be on the basis of the paid compensation attributable to the individual self-insuring employer as a fraction of the total amount of paid compensation for the previous calendar year attributable to all amenable self-insuring employers.

(B) Paid compensation means all amounts paid by a self-insuring employer for living maintenance benefits, all amounts for compensation paid pursuant to sections 4121.63, 4121.67, 4123.56, 4123.57, 4123.58, 4123.59, 4123.60 and 4123.64 of the Revised Code, all amounts paid as wages in lieu of such compensation, all amounts paid in lieu of such compensation under a non-occupational accident and sickness program fully funded by the self-insuring employer, and all amounts paid by a self-insuring employer for a violation of a specific safety standard pursuant to section 35 of article II, Ohio Constitution and section 4121.47 of the Revised Code. Any reimbursement received from the surplus fund pursuant to section 4123.512 of the Revised Code by a self-insuring employer for any such payments or compensation paid shall be applied to reduce the amount of paid compensation reported in the year in which the reimbursement is made. Any amount recovered by the self-insuring employer under section 4123.931 of the Revised Code and any amount that is determined not to have been payable to a claimant in any final administrative or judicial proceeding shall be deducted, in the year collected, from the amount of paid compensation reported.

(C) The assessments shall be computed for all self-insuring employers operating in Ohio by multiplying the following rates by the individual self-insuring employer's paid compensation for calendar year 2022:

(1) Safety and hygiene fund: 0.0033.

(2) Administrative cost fund, BWC: 0.0795.

(3) Administrative cost fund, IC: 0.1055.

(4) Surplus fund (mandatory): 0.0225.

(D) The assessment to fund the portion of the surplus fund that is used for claims reimbursement for all self-insuring employers operating in Ohio who have not made an election to opt out of the right to reimbursement under the provisions of division (H) of section 4123.512 of the Revised Code shall be computed by multiplying the following rate by the individual self-insuring employer's paid compensation for calendar year 2022:

Surplus fund (disallowed claims reimbursement): 0.0050.

(E) An employer who no longer is a self-insuring employer in Ohio or who no longer is operating in this state shall continue to pay assessments for administrative costs and for the portion of the surplus fund that is mandatory. The assessments shall be computed by such employer by multiplying the following rates by the individual employer's paid compensation for calendar year 2022:

(1) Administrative cost fund, BWC: 0.0795.

(2) Administrative cost fund, IC: 0.1055.

(3) Surplus fund (mandatory): 0.0225.

(F) If the paid compensation for a self-insuring employer for calendar year 2022 is less than fourteen thousand two hundred thirty-one dollars and fifty cents, the minimum assessments shall be paid as follows:

(1) Safety and hygiene fund: $46.97.

(2) Administrative cost fund, BWC: $1,131.40.

(3) Administrative cost fund, IC: $1,501.42.

(4) Surplus fund (mandatory): $320.21.

An employer who no longer is a self-insuring employer in Ohio or no longer is operating in this state and who has less than fourteen thousand two hundred thirty-one dollars and fifty cents, in paid compensation for calendar year 2022 shall have a reduced minimum assessment. The minimum assessment shall be ninety per cent of the above minimum assessments in this paragraph in the year after becoming inactive, eighty per cent in the following year, seventy per cent in the following year, and so forth, being reduced ten per cent each year, until the assessment is phased out over ten years. The bureau may, in its discretion, permit an employer to pay its total assessment obligation under this paragraph in a single payment, discounted for present value at a rate determined by the bureau. An employer electing to pay its assessment obligations in a single payment must continue to administer self-insured claims and pay compensation and benefits pursuant to paragraph (C) of rule 4123-19-05 of the Administrative Code.

(G) If an individual self-insuring employer has become self-insured in the last five years (on or after July 1, 2018) paid compensation shall be as defined in paragraph (B) of this rule and shall additionally include compensation paid in calendar year 2022 by the state insurance fund for claim costs directly attributable to the employer prior to becoming self-insured.

(H) The initial assessment to a self-insuring employer in its first calendar year of operation as a self-insuring employer shall be prorated to cover the time period that self-insurance was in effect, but shall not be less than the minimum assessment for a self-insuring employer as provided in paragraph (F) of this rule.

(I) Pursuant to rule 4123-19-15 of the Administrative Code, the following assessment, to be billed and payable in two equal remittances by February 28, 2024, and August 31, 2024, shall be computed for all self-insuring employers by multiplying the following rate by the individual self-insuring employer's paid compensation for calendar year 2022:

Self-insuring employer guaranty fund: 0.1130.

(J) All self-insuring employers must pay assessments under this rule using the online payment offering on the bureau's website. The bureau may waive the online payment requirement with written justification and supporting documentation, satisfactory to the bureau, from the self-insuring employer and filed with the bureau by the payment due date on the assessment remittance. The written justification and supporting documentation must demonstrate the self-insuring employer's inability to remit payment through the online payment offering on the bureau's website.

(K) If an employer fails to pay the assessment when due, the administrator may add a late fee penalty of not more than five hundred dollars to the assessment plus an additional penalty amount as follows:

(1) For an assessment from sixty-one to ninety days past due, the prime interest rate, multiplied by the assessment due;

(2) For assessment from ninety-one to one hundred twenty days past due, the prime interest rate plus two per cent, multiplied by the assessment due;

(3) For an assessment from one hundred twenty-one to one hundred fifty days past due, the prime interest rate plus four per cent, multiplied by the assessment due;

(4) For an assessment from one hundred fifty-one to one hundred eighty days past due, the prime interest rate plus six per cent, multiplied by the assessment due;

(5) For an assessment from one hundred eighty-one to two hundred ten days past due, the prime interest rate plus eight per cent, multiplied by the assessment due;

(6) For each additional thirty-day period or portion thereof that an assessment remains past due after it has remained past due for more than two hundred ten days, the prime interest rate plus eight per cent, multiplied by the assessment due.

For purposes of this paragraph, "prime interest rate" means the average bank prime rate, and the administrator shall determine the prime interest rate in the same manner as a county auditor determines the average bank prime rate under section 929.02 of the Revised Code.

Last updated July 27, 2023 at 8:42 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4121.37, 4121.66, 4123.34, 4123.342, 4123.343, 4123.35
Five Year Review Date:
Prior Effective Dates: 7/1/1994, 7/1/2008, 4/22/2013, 7/1/2013, 7/1/2016, 7/1/2017
Rule 4123-17-33 | Public employer taxing district industry group and limited loss ratio tables.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to calculate contributions made to the state insurance fund by employers pursuant to section 4121.121 of the Revised Code. The administrator hereby sets the industry group assignments and limited loss ratio tables parts A and B to be effective January 1, 2024 applicable to the payroll reporting period January 1, 2024 through December 31, 2024 for public employer taxing districts as indicated in appendices A and B to this rule.

View AppendixView Appendix

Last updated January 2, 2024 at 8:37 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.39, 4123.40
Five Year Review Date:
Prior Effective Dates: 1/1/1994, 3/15/1996, 1/1/1999, 1/1/2006, 1/1/2011, 1/1/2012, 1/1/2013, 1/1/2014, 1/1/2015, 1/1/2016, 1/1/2017, 1/1/2018, 1/1/2020, 1/1/2023
Rule 4123-17-33.1 | Public employer taxing districts experience rating table.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to calculate contributions made to the state insurance fund by employers pursuant to section 4121.121 of the Revised Code. The administrator hereby sets the public employer taxing district experience rating table part A, "credibility and maximum value of a loss," to be effective January 1, 2021, for public employer taxing districts as indicated in appendix A to this rule.

View Appendix

Last updated November 29, 2023 at 2:28 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.39, 4123.40
Five Year Review Date:
Prior Effective Dates: 1/1/1991, 1/1/1995, 1/1/1996 (Emer.), 1/1/1997, 1/1/2001, 1/1/2002, 1/1/2004, 1/1/2005, 1/1/2006, 1/1/2008, 1/1/2009, 1/1/2010
Rule 4123-17-34 | Public employer taxing districts contribution to the state insurance fund.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to section 4121.121 of the Revised Code. The administrator hereby sets base rates and expected loss rates to be effective January 1, 2024 applicable to the payroll reporting period January 1, 2024 through December 31, 2024 for public employer taxing districts as indicated in the appendix to this rule.

View AppendixView Appendix

Last updated January 2, 2024 at 8:38 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.39, 4123.40
Five Year Review Date:
Prior Effective Dates: 1/1/1990, 1/1/1991, 1/1/1992, 1/1/1993, 1/1/1995, 1/1/1999, 1/1/2002, 1/1/2003, 1/1/2009, 1/1/2013, 1/25/2013, 1/1/2015, 1/1/2016, 1/1/2017, 1/1/2018, 1/1/2019, 1/1/2023
Rule 4123-17-35 | Public employer state agency contribution to the state insurance fund.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to sections 4121.121, 4123.39, and 4123.40 of the Revised Code. For the purpose of collecting amounts to cover the payment of costs to the managed care organizations (MCO) that manage the claims of state agencies, including state universities and university hospitals, the administrator has authority to include that expected cost in establishing the combined contribution rate of the state insurance fund. The administrator hereby sets the combined contribution rates per one hundred dollar unit of payroll to be effective July 1, 2023, applicable to the payroll reporting period July 1, 2023, through June 30, 2024, for public employer state (PES) agencies, including state universities and university hospitals, as indicated in the appendix to this rule.

View Appendix

Last updated July 27, 2023 at 8:43 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4121.12, 4123.39, 4123.40
Five Year Review Date:
Prior Effective Dates: 7/1/1990, 7/1/2001, 7/1/2002, 7/1/2003, 7/1/2005, 7/1/2006, 1/1/2008, 7/1/2008, 7/1/2009, 7/1/2012, 7/1/2021
Rule 4123-17-35.1 | Public employer state agency lump sum settlement program.
 

(A) Public employer state (PES) agency that is not currently participating in a settlement payment program may participate in the lump sum settlement (LSS) direct reimbursement rating and payment program. A PES agency participating in this program will have the LSS payments excluded from the bureau's rate calculation process.

(1) Requirements.

(a) A PES agency shall make a three-year minimum commitment to the LSS direct reimbursement payment and rating program.

(b) The earliest beginning date of the LSS program is July 1, 2004.

(c) A PES agency shall notify the bureau of its desire to participate in the LSS direct reimbursement and payment program before the first day of the second month following any quarter ending date to be effective the following quarter. For example, if the PES agency chose to participate in the LSS program beginning April 1, 2016, the request must be submitted before February 1, 2016. The notification shall be made on the form provided by the bureau and signed by the PES agency's designee.

(d) A PES agency currently participating in a settlement program is not eligible to participate in the LSS direct reimbursement payment and rating program.

(2) LSS rate calculation.

(a) All LSS payments will be treated the same whether the result of a court-ordered settlement, an agency-negotiated settlement or any other type of settlement.

(b) Once a PES agency begins participating in the LSS direct reimbursement and rating program, all LSS payments will be excluded from the losses used to calculate the contribution rate for future policy years.

(c) When an agency terminates a LSS direct reimbursement and rating program, the contribution rate will include all LSS payments that were made by the bureau and not reimbursed by the PES agency.

(3) LSS reimburseemnt payments.

(a) A LSS will be billed in the next month following the date the LSS warrant was cashed.

(b) The bureau will bill a structured settlement to the PES agency as the warrant is cashed.

(c) The PES agency shall pay the LSS monthly bill within thirty days of the billing date.

(d) If the PES agency fails to pay a LSS monthly bill within thirty days, the bureau will remove the PES agency from the LSS direct reimbursement rating and payment program and the bureau will include the outstanding LSS payments in the rate calculation.

(e) A PES agency may settle permanent total disability (PTD) and death benefit claims in which the present value was previously used in the rate calculations.

PES agencies will not be billed for the settlement costs of PTD and death benefit claims in which the present value of both medical and indemnity costs was included in contribution rate calculations. These claims would likely be death benefit claims awarded before January 1, 2001 and PTD claims awarded before January 1, 1996.

For PTD claims awarded between January 1, 1996 and December 31, 2000 and where the present value of the future indemnity cost was previously included in the development of the agency's contribution rates, the bureau will include only the medical portion of the settlement amount in the quarterly billings.

(f) A PES agency shall file any dispute in writing, specifying the agency's objections to the billing, with the bureau's direct billing department. The filing of a dispute does not relieve or suspend the agency's obligation to pay the obligation. Questions concerning the rate calculations should be directed to the bureau's actuarial division.

(4) Change in status.

(a) When a PES agency combines with another PES agency, the succeeding agency's participation in this program will not be affected.

(b) A PES agency that is participating in a program and transfers a portion of its operations to another agency shall continue to participate in the program. Participation in this program by the agency to which the operations were transferred will not be affected.

(c) Where a PES agency participating in a LSS direct reimbursement rating and payment program becomes self-insured, the bureau will calculate a buyout and any obligations owed by the PES agency under the program will be included in the buyout.

(B) Terminating a LSS program.

(1) A PES agency may request, in writing, to terminate a LSS program after the three year minimum commitment period has been completed. The agency's participation in the program will automatically be renewed for another three years unless the written request is submitted.

(2) A PES agency shall submit a request to terminate a program before the first day of the second month of the quarter the three year commitment ends. For example, if the PES agency started participating in the LSS program or its participation was renewed for the policy year beginning July 1, 2013, the request must be submitted before May 1, 2016.

(3) Once a PES agency terminates a LSS program, the agency is no longer eligible to participate in this program.

Last updated May 31, 2023 at 1:06 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4121.12, 4123.39, 4123.40
Five Year Review Date:
Prior Effective Dates: 7/1/2002, 7/10/2004, 7/1/2008, 7/1/2015
Rule 4123-17-36 | Administrative cost contribution.
 

(A) The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to calculate contributions to the administrative cost fund by employers pursuant to sections 4121.121, 4123.341, and 4123.342 of the Revised Code. The administrator hereby sets administrative cost rates as indicated in paragraph (D) of this rule for the bureau of workers' compensation and the bureau of workers' compensation board of directors. Based upon the information provided to the administrator by the industrial commission pursuant to section 4123.342 of the Revised Code, the administrator, with the approval of the chairperson of the industrial commission, hereby sets administrative cost rates as indicated in paragraph (E) of this rule for the industrial commission.

(B) The administrative cost rate for each employer's assessment, except for self-insuring employers, is calculated as follows:

(1) If the employer qualifies for experience rating, either as an individual or through participation in group rating, the assessment is calculated based on a percentage of the employer's experience rated premium.

(2) If the employer is not experience rated, the assessment is calculated based on a percentage of the employer's base rate premium.

(3) If the employer is retrospectively rated, the assessment is calculated based on a percentage of the employer's experience rated premium or base rated premium (but not the minimum premium percentage from the retrospective rating plan) that the employer would have paid if the employer were not participating in retrospective rating.

(4) For state agencies, including state universities and state university hospitals, the assessment is calculated based on a percentage of the employer's premium.

(C) Whenever administrative cost rates established under this rule and rule 4123-17-32 of the Administrative Code prove inadequate or excessive, the same may be adjusted at any time during the biennial period.

(D) Administrative cost rates for the bureau of workers' compensation and bureau of workers' compensation board of directors.

(1) Private employers: 26.26 per cent of premium effective July 1, 2023.

(2) Public employer taxing districts: 17.85 per cent of premium effective January 1, 2024.

(3) Public employer state agencies: 17.85 per cent of premium effective July 1, 2023.

(E) Administrative cost rates for the industrial commission.

(1) Private employers: 2.75 per cent of premium effective July 1, 2024.

(2) Public employer taxing districts: 5.01 per cent of premium effective January 1, 2024.

(3) Public employer state agencies: 5.00 per cent of premium effective July 1, 2023.

Last updated July 27, 2023 at 8:44 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.342, 4123.341
Five Year Review Date:
Prior Effective Dates: 7/1/1990, 7/1/2011, 7/1/2018, 7/1/2019, 7/1/2021
Rule 4123-17-37 | Employer contribution to the safety and hygiene fund.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions to the state insurance fund by employers pursuant to sections 4121.121 and 4121.37 of the Revised Code. The administrator hereby establishes the amount of premium to be set aside to fund the division of safety and hygiene to be one per cent of paid premium for public employer taxing districts effective January 1, 2024, one per cent of paid premium for public employer state agencies effective July 1, 2023, and one per cent of paid premium for private employers effective July 1, 2023.

Last updated January 2, 2024 at 8:38 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4121.37, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/21/2008, 7/1/2015
Rule 4123-17-40 | Self-insured buy-out factors.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to establish factors for the purpose of implementing the procedure for self-insurance buy-outs. The administrator hereby adopts factors to establish the liability of a private employer or a public taxing district employer requesting to transfer from state insurance fund coverage to self-insurance with the buy-out calculated upon the pure premium paid by the employer on payroll for a seven calendar year period, as provided in paragraph (L) of rule 4123-19-03 of the Administrative Code. The factors indicated in attached appendix A shall apply to appropriate applications filed on or after July 1, 1998.

View Appendix

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4121.12, 4123.14, 4123.35
Five Year Review Date:
Prior Effective Dates: 11/23/1992, 7/1/1996
Rule 4123-17-41 | Retrospective rating definitions applicable to any employer.
 

Rules 4123-17-41 to 4123-17-54 of the Administrative Code apply to individual employer retrospective rating. As used in rules 4123-17-41 to 4123-17-54 of the Administrative Code:

(A) "Minimum premium" means the fixed cost chargeable to an employer, independent of the claims costs of the employer during the year of experience.

(B) "Maximum premium" means the employer's experience-rated premium multiplied by the maximum premium percentage selected by the employer.

(C) "Per claim limit" means the maximum chargeable costs for each claim incurred during the retrospective-rated period, as selected by the employer.

(D) "Retrospective policy year" or "policy year" means the fiscal year beginning July first for private employers and the calendar year beginning January first for public employer taxing districts.

(E) "Evaluation period" means the ten-year period beginning with the first day of the policy year. Annual evaluations will occur throughout the evaluation period. At the end of the evaluation period, final settlement will be made.

(F) "Final settlement" means the final determination of premium for a policy year including any remaining reserves for claims occurring in the policy year. This determination will occur at the end of the evaluation period and will terminate the plan for that policy year.

(G) "Annual evaluation" means a statement of claim costs and premium. This information will be posted to the employers online bureau account.

(H) "Incurred losses" are compensation payments, medical payments, and reserves, excluding any losses defined in paragraphs (G)(4) and (G)(5) of rule 4123-17-03 of the Administrative Code. Reserves will be assigned at the end of the evaluation period.

(I) "Retrospective premium" means the compilation of minimum premium, all medical costs, indemnity, and any remaining reserves at the end of the ten-year evaluation period.

Last updated July 5, 2022 at 10:46 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29. 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1997, 10/5/2005, 11/1/2021
Rule 4123-17-42 | Eligibility for retrospective rating.
 

(A) An employer that is either a private or a public employer taxing district as defined in division (B)(1) of section 4123.01 of the Revised Code may be eligible for either the tier I or tier II retrospective rating plan depending upon satisfying the eligibility requirements for either the tier I or tier II retrospective rating plan as described in this rule.

(B) For both the tier I and tier II retrospective rating plans, the employer must satisfy the following requirements as of the application deadline:

(1) The employer must be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code.

(2) The employer cannot have cumulative lapses in workers' compensation coverage in excess of fifteen days within the last five rating years.

(3) The employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with such report before the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code.

(4) The employer must be in an active policy status. The administrator may waive this requirement for a new business entity moving into Ohio. For purposes of this rule, "active policy status" does not include a policy that is a no coverage policy or a policy that is lapsed.

(5) The employer's estimated experience-rated premium for the retrospective rating year must be greater than or equal to the minimum experience-rated premium threshold listed on the employer's retrospective rating minimum premium percentages table, contained in the appendices to rule 4123-17-53 of the Administrative Code. If estimated premium is less than the minimum experience-rated premium threshold listed on the employer's retrospective rating minimum premium percentages table, the bureau will reject the application. In the event the estimated experience-rated premium is equal to or greater than the minimum premium threshold but the actual premium is less than the minimum experience-rated premium threshold, the retrospective rating plan remains in effect for that risk and the minimum premium is based on the minimum experience-rated premium threshold multiplied by the appropriate minimum premium percentage for the hazard group and the claim limit/maximum premium percentage selected.

(C) In addition to the requirements of paragraph (B) of this rule, for the tier I retrospective rating plan, a private employer must submit audited financial statements prepared in accordance with generally accepted accounting principles (GAAP) to satisfy the following requirements:

(1) The employer must satisfy financial standards demonstrating strength and stability. In reviewing the financial requirements of the employer, the bureau shall consider, but is not limited to, the following criteria, as applicable:

(a) The employer's trend of operating profit for a minimum of three years;

(b) The employer's trend of net income for a minimum of five years;

(c) The employer's consistent return on equity, of at least ten per cent;

(d) Significant asset size of the employer in the state of Ohio;

(e) A total liabilities/equity ratio of no greater than four to one;

(f) The employer's debt structure, including but not limited to current versus long term debt and recent drastic changes in debt;

(g) The employer's retained earnings trend;

(h) Whether the employer has significant fluctuations in specific balance sheet numbers from one year to the next; and

(i) The employer's bond rating.

(2) The employer shall demonstrate the ability to maintain its financial viability and to cover all costs of the retrospective rating plan through closure, in the event of a catastrophic or severe workers' compensation loss.

(3) The employer cannot have entered into a part-pay agreement for payment of assessments due the state insurance fund for the past three rating years preceding the beginning date of the retrospective policy year.

Alternatively, the employer may provide a letter of credit that is equal to the maximum premium for the applicable policy year.

(D) In addition to the requirements of paragraph (B) of this rule, for the tier I retrospective rating plan, the bureau will obtain a public employer taxing district's audited or reviewed financial statements prepared in accordance with generally accepted accounting principles (GAAP) that are available on the state of Ohio auditors website. The bureau reserves the right to obtain additional financial information from the public employer taxing district. The bureau will review the public employer taxing district's financial statements to satisfy the following requirements:

(1) The public employer taxing district must satisfy financial standards demonstrating strength and stability. In reviewing the financial requirements of the public employer taxing district, the bureau shall consider, but is not limited to, the following criteria, as applicable:

(a) Significant asset size of the public employer taxing district in the state of Ohio;

(b) The public employer taxing district's debt structure, including but not limited to current versus long term debt and recent drastic changes in debt;

(c) Whether the public employer taxing district has significant fluctuations in amounts reported on the balance sheet and statement of operations from one year to the next; and

(d) The public employer taxing district's underlying or uninsured bond rating.

(2) The public employer taxing district shall demonstrate the ability to maintain its financial viability and to cover all costs of the retrospective rating plan through closure, in the event of a catastrophic or severe workers' compensation loss.

(3) The public employer taxing district cannot have entered into a part-pay agreement for payment of assessments due the state insurance fund for the past three rating years preceding the beginning date of the retrospective policy year.

(4) The public employer taxing district in making its initial application for retrospective rating, cannot be under fiscal watch or fiscal emergency pursuant to section 118.022, 118.04 or 3316.03 of the Revised Code as of the application deadline for retrospective rating.

(E) In addition to the requirements of paragraph (B) of this rule, for the tier II retrospective rating plan:

(1) A private employer must submit audited financial statements prepared in accordance with generally accepted accounting principles (GAAP).

(2) The bureau will obtain a public employer taxing district's audited or reviewed financial statements prepared in accordance with GAAP or other comprehensive basis of accounting as permitted in Ohio auditor of state bulletin 2005-002 from the state of Ohio auditor's website. The bureau reserves the right to obtain additional financial information from the public employer taxing district.

(3) For a private employer that does not demonstrate the ability to satisfy the financial criteria of paragraph (C) of this rule, or a public employer taxing district that does not demonstrate the ability to satisfy the financial criteria of paragraph (D) of this rule, the financial statements provided by the employer must demonstrate the ability to sustain losses that are at the maximum claim limit for the retrospective rating plan and still maintain its financial viability.

Last updated July 27, 2023 at 8:44 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 11/15/2010
Rule 4123-17-43 | Application for retrospective rating plan.
 

(A) All operations of an employer electing retrospective rating are subject to retrospective rating.

(B) The application must be filed on a bureau application form for the retrospective rating plan. The application must be completed in its entirety, including but not limited to the selection of a per-claim limit and maximum premium per cent. The absence of pertinent information will result in the application being rejected.

(C) The application and all other required information must be filed by the application deadline. An application for a retrospective rating plan is applicable to only one policy year. Continuation of a plan for subsequent years is subject to filing of an application on a yearly basis and the meeting of eligibility requirements each year.

(D) All changes to the original application must be filed on another application form for the retrospective rating plan prior to the filing deadline. Any changes made must be completed in writing and signed by an officer of the company and filed prior to the filing deadline. Any changes received by the bureau after the filing deadline will not be accepted. The latest application form or rescission received by the bureau prior to the filing deadline will be used in determining the premium obligation.

Last updated February 18, 2022 at 11:48 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1988, 10/2/1990, 7/1/2019
Rule 4123-17-44 | Minimum retrospective premium.
 

(A) The minimum annual premium due shall not be less than the minimum experience-rated premium threshold times the minimum premium percentage for the employer's hazard group, claim limit, and maximum premium percentage for the applicable policy year. The premium will be subject to the premium sized adjustment described in rule 4123-17-03.3 of the Administrative Code.

(B) If estimated experience-rated premium is greater than or equal to the minimum experience-rated premium threshold listed on the employers retrospective rating minimum premium percentages table, contained in the appendices to rule 4123-17-53 of the Administrative Code, but actual experience-rated premium is less than the minimum experience-rated premium threshold listed, the minimum premium due is the minimum experience-rated premium threshold times the minimum premium percentage for the employer's hazard group, claim limit, and maximum premium percentage.

(C) The minimum annual premium is due and payable even if the employer has no claims costs during the evaluation period for the applicable policy year.

(D) The minimum premium will be recalculated at the time the employer submits actual payroll pursuant to rule 4123-17-14 of the Administrative Code.

Last updated February 18, 2022 at 11:48 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1988, 10/2/1990
Rule 4123-17-45 | Initial computation.
 

(A) The hazard group for an employer shall be determined as follows:

(1) The employer's experience-rated premium is totaled for each hazard group for the most recently completed policy year. The employers hazard group is the group with the highest percentage of premium for the recently completed policy year;

(2) For an employer new to Ohio without a reported payroll, the hazard group is based on the employers application for workers compensation coverage;

(3) Hazard groups are defined as follows:

(a) For private employers, appendix C to rule 4123-17-72 of the Administrative Code; and

(b) For public employer taxing districts, appendix E to rule 4123-17-72 of the Administrative Code.

(B) The bureau shall notify the employer of the estimated minimum premium percentage based on the limits selected by the employer and the payroll of the employer. The premium rates on the payroll reports received by the employer for the policy year will be calculated using the minimum premium per cent and the premium sized adjustment described in rule 4123-17-03.3 of the Administrative Code.

Last updated February 18, 2022 at 11:48 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/21/2008, 7/1/2015
Rule 4123-17-46 | Premium adjustments.
 

(A) Upon completion of a policy year and annually throughout the evaluation period, the employer's aggregate retrospective-rated premium for the policy year will be determined based on the incurred losses and on the audited payrolls of the employer. The bureau shall annually send the employer an annual evaluation within approximately four months following the end of the policy year.

(B) Incurred losses will be based on compensation payments and medical payments, as defined in rule 4123-17-41 of the Administrative Code. The cost of permanent total disability claims and death claims will be charged to the employer as the payments are made, and the reserve will be billed in the final settlement.

(C) If the retrospective premium due is less than the retrospective premium paid as of the prior evaluation date, the difference, subject to the minimum premium, less assessments due any fund administered by the bureau will be refunded to the employer.

(D) If the retrospective premium due is greater than the retrospective premium paid as of the prior evaluation date, the difference must be paid to the bureau within forty-five days after the due date of the invoice billing the additional retrospective premium, or the employer will be subject to penalties as provided in rule 4123-17-48 of the Administrative Code.

(E) Values used in an annual evaluation will not be revised for any reason other than clerical error. The bureau must be notified of any such errors, in writing, within sixty days after the due date on the invoice billing the retrospective premium.

(F) Premiums are subject to minimum and maximum premium limitations as selected by the employer.

Last updated November 2, 2021 at 10:12 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1988
Rule 4123-17-47 | Final settlement.
 

(A) At the end of the tenth-year determination of retrospective premium, the plan for that retrospective policy year shall terminate.

(B) As part of the final determination of retrospective premium, the bureau will evaluate the employer's claims and establish reserves. Reserves will be developed for claims, other than allowed permanent total disability claims and allowed death claims, using the balance sheet reserve table in effect as of the ending date of the evaluation period.

(C) The bureau will notify the employer of the reserve balances which will be reflected on the annual evaluation.

(D) The final settlement calculated, subject to the minimum and maximum premium of the plan selected, shall be paid to the bureau within forty-five days after the due date the the additional retrospective premium.

(E) The final determination of a retrospective premium will not be revised for any reason other than clerical error.

Last updated February 18, 2022 at 11:48 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 10/2/1990
Rule 4123-17-48 | Penalties.
 

Any retrospective-rated employer failing to file a report of payroll expenditures or failing to pay premium when due, as prescribed in rules 4123-17-14, 4123-17-14.2, 4123-17-46, and 4123-17-47 of the Administrative Code, will be penalized in accordance with paragraph (C) of rule 4123-17-16 of the Administrative Code . All premium due as a result of the selection of retrospective rating, including the minimum premium and premium as a result of annual evaluations, shall be included as premium as used in this rule.

Last updated February 18, 2022 at 11:48 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1990, 11/1/2011
Rule 4123-17-51 | Termination and transfers.
 

(A) A risk may not retroactively include claims experience in a plan, exclude claims experience from a plan nor voluntarily terminate a plan during the evaluation period.

(B) Successor: retrospective-rated predecessor: experience-rated, base-rated, non-complying or self-insured

Where one legal entity that has established coverage and is a retrospective-rated employer wholly succeeds one or more legal entities having established coverage and the predecessor entities are either experience-rated, base-rated, non-complying or self-insured at the date of succession, the costs incurred and payroll reported by the predecessor from the date of succession to the end of the policy year, shall be included in the successor's retrospective rating plan. The successor remains liable for any and all charges associated with the predecessor. If the predecessor had at any time participated in a retrospective policy plan, the successor remains liable for any and all charges associated with the retrospective policy plans. The adjustment for combinations in the experience rating system will follow the same rules that are in effect as of the date of succession.

(C) Successor: self-insured predecessor: retrospective-rated

Where one legal entity that has established coverage and is a self-insured employer wholly succeeds one or more entities that are retrospective-rated, the retrospective-rated predecessor's plan(s) shall terminate as of the ending date of the evaluation period. Payroll reported and claims incurred on or after the date of succession will be the responsibility of the successor. The successor shall remain responsible for all liabilities of the predecessor, including but not limited to costs associated with any retrospective policy years still in the evaluation period. The minimum premium for the current policy year will be based on the predecessor's annualized payroll.

(D) Successor: experience-rated or base-rated predecessor: retrospective-rated

Where one legal entity that has established coverage and is an experience-rated or based-rated employer wholly succeeds one or more entities that are retrospective-rated, the retrospective-rated predecessor's plan(s) shall terminate as of the ending date of the evaluation period. Payroll reported and claims incurred on or after the date of succession will be the responsibility of the successor under its experience rated plan. The successor shall remain responsible for all liabilities of the predecessor, including but not limited to costs associated with any retrospective policy years still in the evaluation period. The minimum premium for the current policy year will be based on the predecessor's annualized payroll.

(E) Successor: retrospective-rated predecessor: retrospective-rated

If the successor and the predecessor are retrospective-rated employers for the current policy year, the successor shall be retrospective-rated based on the combined experience of the predecessor and the successor. The successor remains liable for any and all retrospective-rated premiums or other charges associated with the predecessor. The adjustment for combinations in the experience rating system will follow the same rules that are in effect as of the date of succession.

(F) Successor: entity not having coverage predecessor: retrospective-rated

When an entity not having coverage wholly succeeds a retrospective-rated entity, the experience of the predecessor shall be transferred to the successor-employer effective as of the actual date of succession. The successor remains liable for any and all open retrospective-rated premium or other charges associated with the predecessor. The successor entity will become retrospective-rated as of the date of succession until the end of the policy year, with the same plan parameters chosen by the predecessor risk. The adjustment for combinations in the experience rating system will follow the same rules that are in effect as of the date of succession.

(G) Successor: cancels coverage predecessor: no predecessor

If a current or previously retrospective-rated employer cancels coverage and does not transfer or combine operations with another entity, all open retrospective policy years will be terminated as of the date of cancellation. If the employer was retrospective-rated during the two most recent rating years, the final premium for each of those years will be the maximum premium for the plan selected by the employer. The maximum premium for the current year will be based on the employer's annualized payroll. If the employer was retrospective-rated in other years of the evaluation period, the final premium for each of those years will be calculated as stated in rule 4123-17-47 of the Administrative Code.

(H) Successor: files a petition for bankruptcy predecessor: no predecessor

If a current or previously retrospective-rated employer with open policy year(s) files a petition for bankruptcy under chapter 7 or chapter 11 of the Federal Bankruptcy Law, that employer shall notify the bureau's law section by certified mail within five working days from the date of the bankruptcy filing. The bureau will petition the bankruptcy court to take appropriate action to protect the health of the state insurance fund and other related funds.

(I) Successor and/or predecessor: open retrospective-rated policy years in the evaluation period.

If the successor and predecessor employers are not currently retrospective-rated but either or both have open retrospective-rated policy years in the evaluation period, the successor shall be liable for any and all retrospective-rated premiums or other charges associated with the predecessor. The adjustment for combinations in the experience rating system will follow the same rules that are currently being used.

(J) Partial transfer

If an entity partially succeeds another entity and the predecessor entity has any retrospective policy years in the evaluation period, the predecessor entity remains liable for all premium associated with claims incurred prior to the date of the partial transfer. If the financial capability of the predecessor entity is not sufficient to cover the costs of the retrospective rating plan, the successor shall be liable for all unpaid costs of the predecessor's retrospective rating plan through closure. If the successor is retrospective-rated in the current policy year and the effective date of the partial transfer is other than the beginning of the rating year, the successor will continue to be rated in the same manner as prior to the transfer. The successor will be liable for any payroll and/or claims incurred from that part of the predecessor entity which was transferred, beginning on the date of the transfer. If the successor has retrospective policy years in the evaluation period, the successor remains liable for all charges associated with retrospective rating plan(s), whether or not the successor is retrospective rated as of the effective date of the partial transfer. The adjustment for partial transfers in the experience rating system will follow the same rules that are in effect as of the date of succession.

(K) Transfer or sale of assets only

In the case of the transfer or sale of assets without transfer of liability or stock, the transferor who is now retrospective-rated or has been retrospective-rated with policy year(s) still in the evaluation period shall notify the bureau's actuarial section by certified mail within five working days of the date of transfer. The bureau shall schedule and hold a hearing within sixty days of such notification, or in the event of no notification, within sixty days of receiving information which indicates such a transfer may have occurred. At this hearing the bureau shall determine and set responsibility for funding the as yet unpaid costs associated with the retrospective policy year(s) still in the evaluation period.

Last updated February 18, 2022 at 11:48 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1988
Rule 4123-17-52 | Parameters of the retrospective rating plan.
 

(A) An employer participating in retrospective rating will pay the following:

(1) Minimum premium. The minimum premium depends on the assigned hazard group, the per claim limit selected by the employer, the maximum premium limit selected by the employer, and the employer's base-rated premium or experience-rated premium. The employer's base-rated premium or experience-rated premium is assumed to be at least the minimum experience-rated/base-rated premium threshold listed on the employer's retrospective rating minimum premium percentages table contained in the appendices to rule 4123-17-53 of the Administrative Code. The minimum premium includes employer contributions to cover safety and hygiene costs, surplus costs, and the cost of losses exceeding the per claim and the maximum premium limitations and those health partnership program costs associated with the losses exceeding the per claim and the maximum premium limitations. The minimum premium is subject to the premium sized adjustment described in rule 4123-17-03.3 of the Administrative Code.

(2) Premium based on paid losses. The employer will pay for any compensation payments, including death and permanent total disability, and medical payments made in covered claims. Billings to the employer will be sent annually for ten years to collect for these medical and compensation payments.

(3) Premium based on claim reserves. The employer will pay the value of reserves on claims evaluated as of the end of the tenth year.

(4) Premium for health partnership program costs on retained losses. In each evaluation period associated with a policy year, the employer will pay an additional premium based on a percentage, known as the loss conversion factor applied to the paid losses and claims reserves to cover the associated health partnership program costs of those paid losses or claims reserves. Each policy year will have a specific loss conversion factor, determined before the start of the policy year, which will apply for the ten year retrospective period.

(B) Surplus charges in claims will not be charged to the employer.

(C) Individual claims costs will be limited to the per claim limit selected by the employer. The usual experience rating limitations will not apply.

(D) The employer's maximum premium will be limited to a percentage of its base-rated or experience-rated premium as selected by the employer. That is, premiums based on losses, reserves and health partnership program costs charged to the employer cannot exceed the maximum premium minus the minimum premium. The maximum premium is subject to the premium sized adjustment described in rule 4123-17-03.3 of the Administrative Code

(E) The premium for health partnership program costs on retained losses is an aggregate calculation made on the total billings to an employer for either paid losses or reserves. As such, premiums associated with health partnership program costs are not allocated to individual claims, and therefore are not considered when evaluating whether an individual claim has reached the per claim limit.

(F) When an employer leaves a retrospective rating program and returns to the state fund program, the employer shall be subject to all of the provisions of rule 4123-17-03 of the Administrative Code, classification rates.

(G) An employer removed from retrospective rating for failure to comply with paragraph (B) of rule 4123-17-42 of the Administrative Code will be required to pay:

(1) Claims costs according to this rule for all injuries incurred from the beginning of the policy year in which the employer participated in retrospective rating through the date of removal from the program.

(2) Full experience-rated premium from the date of removal from retrospective rating through the remainder of the policy year.

Last updated February 18, 2022 at 11:48 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1997, 10/5/2005, 7/1/2015
Rule 4123-17-53 | Private employer retrospective rating plan minimum premium percentages.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to sections 4121.121, 4121.13, 4121.30, 4123.29, and 4123.34 of the Revised Code.

The administrator hereby sets the private employer retrospective rating plan minimum premium percentages to be effective July 1, 2015, as indicated in the appendixes A, (Tier I, tables A, B, C, D, E, F, and G) and B (Tier II, tables A, B, C, D, E, F, and G) to this rule.

The administrator hereby sets the private employer loss conversion factors to be applied to losses associated with policy years beginning on or after July 1, 2015, as indicated in appendix C to this rule.

View Appendix

Last updated March 2, 2023 at 8:15 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/1991, 7/1/1993, 7/1/1994, 7/1/1997, 1/1/2021
Rule 4123-17-54 | Public employer retrospective rating plan minimum premium percentages.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to sections 4121.121, 4123.29, and 4123.34 of the Revised Code.

The administrator hereby sets the public employer taxing districts retrospective rating plan minimum premium percentages to be effective January 1, 2016, as indicated in appendixes A (Tier I) and B (Tier II) to this rule.

The administrator hereby sets the public employer loss conversion factors to be applied to losses associated with policy years beginning on or after January 1, 2016, as indicated in appendix C to this rule.

View AppendixView AppendixView Appendix

Last updated January 3, 2023 at 9:48 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 1/1/1992, 1/1/1994, 1/1/1998, 7/21/2008, 1/1/2016, 8/20/2018, 1/1/2021
Rule 4123-17-55 | Transitional work development grant and performance bonus.
 

(A) Definitions.

As used in this rule:

(1) "AEO" and "PEO" have the same meaning as defined in rule 4123-17-15 of the Administrative Code.

(2) "Application deadline" means the applicable application deadline set forth in appendix A or in appendix B to rule 4123-17-74 of the Administrative Code.

(3) "Client employer" has the same meaning as defined in rule 4123-17-15 of the Administrative Code.

(4) "Program period" means the policy year for which the employer elects to participate in the transitional work program.

(5) "Transitional work" has the same meaning as defined in rule 4123-6-01 of the Administrative Code.

(6) "Transitional work developer" means the provider who develops the employers transitional work program. A transitional work developer shall:

(a) Meet the minimum credentials designated in rule 4123-6-02.2 of the Administrative Code for one of the following provider types:

(i) A vocational rehabilitation case manager,

(ii) An occupational therapist, or

(iii) A physical therapist; and

(b) Complete bureau sponsored transitional work development training prior to delivering transitional work programs and at two-year intervals.

(B) Eligibility requirements.

(1) To receive benefits under this rule, the employer must meet the following criteria as of the application date for the grant or the application deadline for the transitional work bonus:

(a) The employer must be current with respect to all payments due the bureau, as defined in rule 4123-17-14 of the Administrative Code.

(b) The employer must not have cumulative lapses in workers' compensation coverage in excess of forty days within the preceding twelve months.

(c) The employer must be in an active policy status. For purposes of this rule, "active policy status" does not include a policy that is a no coverage policy or a policy that is lapsed.

(d) The employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the application deadline.

(2) The following employers shall not be eligible for either a transitional work program development grant or a transitional work bonus under this rule:

(a) Employers paying the minimum administrative charge for the applicable payroll reporting period as set forth in rule 4123-17-26 of the Administrative Code.

(b) State agencies; and

(c) Self-insuring employers providing compensation and benefits pursuant to section 4123.35 of the Revised Code.

(3) The following employers shall not be eligible to receive a transitional work program development grant under paragraph (C) of this rule:

(a) Employers who have elective coverage only; and

(b) Sole proprietors with zero payroll.

(4) An employer that is found to be ineligible for participation in the program may reapply for a subsequent program period.

(C) Transitional work program development grant.

(1) An employer interested in obtaining a transitional work program development grant shall apply to the bureau on a form provided by the bureau. In signing the application form, the chief executive officer or designated management representative of the employer is certifying to the bureau that the employer will comply with all program requirements.

(2) The bureau shall evaluate each application to determine the employer's eligibility to receive a transitional work program development grant and shall have the final authority to approve a grant for an eligible employer and to determine the amount of the grant. If, upon review of an application, the bureau determines that it can assist the employer in developing a transitional work program, the bureau may deny the grant and provide assistance to the employer directly.

(3) Transitional work program development grant awards expire five years from the date of the mailing of the notice of approval of the grant. Upon expiration of the grant, the employer loses any remaining grant funds that were awarded but unspent. However, the employer may apply for a new transitional work program development grant.

(4) An employer is eligible for no more than one transitional work program development grant per policy number every five years, calculated from the date of the mailing of the notice of approval of the previous transitional work program development grant. The bureau shall provide assistance to employers as needed to update transitional work programs developed with previous grants.

(5) Grant amounts will be determined by the bureau based on employer size and the complexity of services needed for transitional work services. Factors which may determine appropriate grant amounts may include the employer's:

(a) Payroll;

(b) Job classifications;

(c) Job analyses needed; and

(d) Collective bargaining units.

(6) The bureau shall not reimburse an employer for costs associated with a transitional work developer's preparing and submitting a proposal to an employer and shall not reimburse for costs determined by the bureau to be ineligible or unnecessary. The bureau may monitor the content and implementation of transitional work services.

(7) The employer shall have and maintain continuous active state fund coverage for a period of one year from the date the bureau disburses the grant funds to the employer. The bureau may recover the entire grant if the bureau determines the employer has failed to maintain coverage as required by this rule.

(D) Transitional work bonus program.

An employer who has developed and implemented a transitional work program may be eligible to receive a transitional work bonus as provided for in this rule.

(1) The employer must report actual payroll due upon reconciliation of estimated premium and actual premium for the program period no later than the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with such report before the expiration of any grace period established by the Administrator pursuant to rule 4123-17-16 of the Administrative Code.

(a) Failure to comply with paragraph (D)(1) of this rule shall immediately remove the employer from the transitional work bonus program for the current program period, and the employer shall not be eligible for a transitional work bonus for the current program period.

(b) Should an employer fail to comply with paragraph (D)(1) of this rule, the employer may reapply to the transitional work bonus program subject to the eligibility requirements of paragraph (B) of this rule for the next program period.

(2) An employer interested in participating in the transitional work bonus program shall apply to the bureau on a form provided by the bureau. In signing the application form, the chief executive officer or designated management representative of the employer is certifying to the bureau that the employer will comply with all program requirements.

(3) The bureau shall evaluate each application to determine the employer's eligibility to participate in the transitional work bonus program at the time of the application. The bureau shall have the final authority to approve an eligible employer for participation in the transitional work bonus program.

(4) The transitional work program bonus calculation shall occur at six months following the end of the applicable program period. The bureau will evaluate all claims of the employer with injury dates that fall within the applicable program period to determine:

(a) How many of those claims had the potential for transitional work services, and

(b) How many of the claims identified in paragraph (D)(4)(a) of this rule utilized transitional work services.

(5) The bureau will calculate the employers percentage of claims with potential for transitional work services in which transitional work services were utilized.

(6) The employer will receive a transitional work bonus equal to the percentage calculated pursuant to paragraph (D)(5) of this rule multiplied by a percentage of the employer's pure premium for the applicable program period as set forth in the appendix to rule 4123-17-75 of the Administrative Code. The transitional work bonus will be posted to the employers account with the bureau.

(7) An AEO or a PEO shall be eligible to receive a transitional work bonus under this rule for claims in which the AEO or the PEO was the employer of record on the date of injury and transitional work services were available under a transitional work program of either the AEO, the PEO or its client employer.

(8) An employer may appeal the bureau's transitional work bonus program application rejection or the bureau's transitional work bonus determination to the bureau's adjudicating committee pursuant to section 4123.291 of the Revised Code and rule 4123-14-06 of the Administrative Code.

(9) Unless an employer notifies the bureau otherwise as outlined below, continued participation in this program for each subsequent program period shall be automatic provided that the employer continues to meet the eligibility requirements set forth in paragraph (B) of this rule.

An employer that elects to opt out of continued participation in this program shall provide written notice to the bureau by the application deadline set forth in this rule.

Last updated July 27, 2023 at 8:44 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 3/13/2017
Rule 4123-17-56 | Safety grant programs.
 

(A) Pursuant to section 4121.37 of the Revised Code, the administrator of workers' compensation may establish a program of safety grants for safety interventions or research for eligible employers. The safety grant program may provide grant funds to an eligible employer for safety interventions including education, training, research, or purchase of equipment to prevent occupational injuries, illnesses, or fatalities.

(1) The purpose of the safety intervention grant program is for the division of safety and hygiene of the bureau of wokers' compensation to fund employer interventions that reduce the risk of injuries, illnesses, and fatalities in the workplace, investigate the effectiveness of safety interventions in preventing occupational injuries, illnesses, and fatalities and establish safety and health best practices. For this purpose, the bureau may make safety grants to employers as provided in this rule.

(2) If the division of safety and hygiene concludes there are interventions outside the scope of the program, the division of safety and hygiene may establish an unapproved items list to notify employers of specific safety education, training, research, or purchase of equipment that the bureau shall not fund.

(B) The bureau may limit participation in the safety grant program based upon:

(1) The availability of bureau resources for the program;

(2) The merits of the employer's proposal;

(3) The type of employer's policy;

(4) The manual numbers reported under the employer's policy;

(5) The employer's policy history; or

(6) The safety grant program objectives and unapproved items list under paragraph (A) of this rule.

(C) The bureau shall determine whether the employer's policy is eligible for the safety grant program under this rule. The employer must satisfy the following criteria:

(1) The safety grant program is available only to a private state fund employer, a public employer taxing district, a marine industry fund employer, or a coal-workers' pneumoconiosis fund employer;

(2) The employer shall have active state fund-coverage to participate in the safety grant program;

(3) The employer shall have active coverage for one year prior before applying for a safety grant and shall maintain active coverage for the one year after implementation of the safety intervention under the safety grant approved by the bureau;

(4) The employer shall be current with respect to all payroll reporting and required payments due to any fund administered by the bureau;

(5) The employer shall not have more than forty days of cumulative lapses in workers compensation coverage within the prior twelve months.

(D) The bureau will assess whether the employer's proposed safety intervention is eligible to participate in the safety grant program under this rule.

(1) The employer's proposed safety intervention shall explain how one of the following objectives is attained through receipt of safety grant funds:

(a) Reduction of risk of workplace injuries, illnesses, or fatalities; or

(b) Advancement of research into the prevention of workplace injuries, illnesses, or fatalities.

(2) The owner, chief executive officer, chief financial officer or persons having fiduciary responsibilities with the employer may be required to meet with a bureau consultant to review the safety grant program application.

(3) The bureau shall review and evaluate the safety grant application. The bureau may also assess and evaluate the employer's safety and loss prevention and control programs. If the bureau accepts the employer into the safety grant program, the employer shall submit reports and case studies to the bureau as required by the bureau for a period of one year following the purchase and implementation of the safety intervention.

(4) The bureau and employer shall enter into a written agreement detailing the rights, obligations, and expectations of the parties for performance of the safety grant program.

(5) The employer may not apply for a safety grant for reimbursement of previously purchased safety interventions.

(6) The employer shall agree to not eliminate jobs or reduce employment due to the intervention funded by the safety grant program. If the bureau determines an employer has violated this provision, the employer shall be immediately disqualified from participation in the safety grant program, and the employer shall return all disbursed safety grant funds to the bureau for the intervention that eliminated jobs or reduced employment.

(7) The bureau shall establish policies and processes for adding or removing safety interventions on the unapproved items list. The bureau shall not accept an employer's proposed intervention if the employer's proposed intervention contains any item on the unapproved items list.

(E) The bureau may meet with the owner, chief executive officer, chief financial officer, or persons having fiduciary responsibilities with the employer to evaluate the employer's progress in the safety grant program. The employer shall provide the bureau access to records or personnel to conduct research into the effectiveness of the safety grant program.

(F) An employer who complies with the requirements of the safety grant program under this rule shall be eligible to receive a grant from the bureau as provided in the written agreement.

(1) The bureau may establish by written agreement with the employer the maximum amount of the safety grant funds.

(2) The bureau may establish by written agreement with the employer a requirement for matching funds from the employer in a ratio to be determined by the bureau.

(3) The bureau shall monitor the employer's use of the safety grant program funds. The bureau may recover the entire grant if the bureau determines that the employer has not used the grant for the purposes of the safety grant program or has otherwise violated the written agreement of the safety grant program.

(G) Reconsideration of determination of ineligibility to participate in, or disqualification from, the safety grant program.

(1) An employer may request reconsideration of a decision finding the employer did not meet the requirements provided in paragraph (C) of this rule or disqualifying the employer from continued participation in the safety grant program. The request must be in writing and filed with the superintendent of the division of safety and hygiene within thirty days of the notification of the decision.

(2) The employer may submit a request for reconsideration of the superintendent's decision to the adjudicating committee in accordance with the provisions contained in rule 4123-14-06 of the Administrative Code.

(H) Upon the approval, purchase, and implementation of the safety intervention, the employer shall provide to the bureau sufficient documentation on the use of the funds, including proof of payment, proof of the employer's and bureau's contribution, and proof that the funds were fully applied to the approved safety intervention.

(1) The employer shall purchase, implement, and provide purchase documentation for all approved safety interventions within the time period determined by the superintendent from the date that the bureau disburses safety grant funds to the employer.

(2) The purchase and implementation of the safety intervention can take place only after the approval of the safety grant funds.

(3) The bureau may extend the period defined in paragraph (H)(1) of this rule by up to ninety days in special circumstances where the employer, for reasons beyond their control, experiences delay in purchasing or implementing the approved safety intervention. The employer must request additional time in writing that explains the special circumstances, with any supporting documentation, and specifying the additional time needed. The bureau may grant additional extensions of up to ninety days, pursuant to the same requirements and guidelines for the initial extension, but the cumulative period of all extensions shall not exceed one year.

(I) The bureau shall evaluate the effectiveness of the safety grant program on a periodic basis. The bureau may publish reports of the safety grant program's effectiveness and research findings to assist employers in preventing workplace injuries and illnesses.

(J) Marine industry fund and coal-workers' pneumoconiosis fund safety grants.

(1) A marine industry fund employer or a coal-workers' pneumoconiosis fund employer applying for a safety grant is subject to paragraphs (A) to (I) of this rule.

(2) The bureau's division of safety and hygiene shall determine whether the marine industry fund employer or the coal-workers' pneumoconiosis fund employer is eligible for the safety grant program under this rule. The safety grant program in this rule is available only to a marine industry fund or a coal-workers' pneumoconiosis fund employer that satisfies the following additional criteria:

(a) A marine industry fund employer shall have and shall maintain active state fund coverage under rule 4123-17-19 of the Administrative Code.

(b) A coal-workers' pneumoconiosis fund employer shall have and shall maintain active state fund coverage under rule 4123-17-20 of the Administrative Code.

(c) A coal-workers' pneumoconiosis fund employer may only use the safety grant to purchase equipment to prevent coal workers' pneumoconiosis.

(3) Additional employer responsibilities include:

(a) A marine industry fund employer or a coal-workers' pneumoconiosis fund employer shall contact the local bureau customer service office to schedule a visit by a bureau safety consultant.

(b) A coal-workers' pneumoconiosis fund employer shall also schedule a visit by a mine safety inspector from the Ohio department of natural resources.

Last updated December 11, 2023 at 9:52 AM

Supplemental Information

Authorized By: 4123.12, 4123.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 8/1/2022
Rule 4123-17-56.1 | Workplace wellness grant program rule.
 

(A) For purposes of this rule:

(1) "Health risk factors" means physical and mental characteristics that can be modified, nearly always with much less cost compared to waiting for sickness and then attempting to treat the disease.

(2) "Employer" or "employer" means a private state fund employer, a public employer taxing district, a marine industry fund employer, or a coal-workers' pneumoconiosis fund employer.

(3) "Workplace wellness program" means a health and wellness program in the workplace which consists of a biometric screening and health risk appraisal, and activities based on the results of the screening, program measurements and policies.

(B) Workplace wellness grant program.

(1) Pursuant to section 4121.37 of the Revised Code, the administrator may establish a program of workplace wellness grants for the prevention of occupational injuries and illnesses for which an employer is eligible under this rule. The workplace wellness grant may include grants to an employer to provide funds to address health risk factors to reduce the number and severity of workplace injuries and illnesses.

(2) The bureau shall determine whether the employer is eligible for the workplace wellness grant program under this rule. The bureau may limit participation in the workplace wellness grant program based upon the availability of bureau resources for the program and upon the merits of the employer's proposal. The bureau shall award grant funds for employers on a first come, first serve basis. The workplace wellness grant program is available to a state-fund employer that satisfies the following criteria:

(a) The employer shall be current with respect to all payroll reporting and payments due to any fund administered by the bureau.

(b) The employer shall not have more than forty days of cumulative lapses in workers' compensation coverage within the prior twelve months.

(c) The employer shall maintain active state fund coverage to participate in the workplace wellness grant program.

(d) For grants to an employer for the research and implementation of workplace wellness programs, the employer shall submit to the bureau an application for participation in the workplace wellness grant program. The employer shall demonstrate a need for workplace wellness grant program.

(e) The employer is not eligible for a workplace wellness program grant if the employer has an existing workplace wellness program.

(3) The bureau shall assess the employer's workplace wellness proposal and shall review the workplace wellness grant program application, including the baseline assessment of the worksite provided in the application.

(a) If the bureau accepts the employer into the workplace wellness grant program, the employer shall submit an annual report to the bureau for up to four years following the implementation of the wellness program. The employer shall develop an implementation strategy plan for its workplace wellness grant program.

(b) The bureau and employer shall enter into a written agreement detailing the rights, obligations, and expectations of the parties for performance of the workplace wellness grant program.

(c) The employer shall implement the wellness program within three months from the date that the bureau disburses the grant funds to the employer. The implementation of the workplace wellness program cannot take place before the disbursement of the grant funds.

(4) The employer shall agree to not eliminate jobs or reduce employment due to the implementation of the workplace wellness program.

(5) The bureau may meet with the owner, chief executive officer, chief financial officer, or persons having fiduciary responsibilities with the employer to evaluate the employer's progress in the workplace wellness grant program.

(6) An employer who complies with the requirements of the workplace wellness grant program under this rule shall be eligible to receive a grant from the bureau as provided in the written agreement.

(a) The bureau may establish a limit for the amount of monies it disburses for the workplace wellness grant and this amount shall be established by written agreement with the employer.

(b) The bureau may require that the employer must execute its workplace wellness program through an approved vendor.

(c) The bureau shall monitor the employers use of the workplace wellness grant program funds.

(7) Reconsideration of determination of eligibility.

(a) An employer may request reconsideration from a decision finding the employer did not meet the requirements provided in paragraph (B)(2) or (B)(3) of this rule. The request must be in writing and filed with the superintendent of the division of safety and hygiene within thirty days of the notification of the decision.

(b) The employer may submit a request for reconsideration of the superintendents decision to the adjudicating committee.

(c) The adjudicating committee shall consider the request and make a recommendation on the employer's eligibility to the administrator.

(d) The decision of the administrator shall be final.

(8) Upon the approval of the proposed wellness program, the employer shall provide to the bureau documentation on the use of the funds, including submission of original paid itemized invoices, proof of payment, proof of the employers contribution, and cancelled checks that demonstrate the employer spent all workplace wellness grant funds toward the approved expenditures.

(9) The bureau shall evaluate the research data from the workplace wellness grant program on a periodic basis. The bureau may publish reports of the research to assist employers in preventing workplace injuries and illnesses.

(C) Continuing eligibility for the workplace wellness grant program once acceptance has been granted.

(1) An employer participating in the workplace wellness grant program shall be eligible to continue participating in the program only if the employer maintains active workers' compensation coverage according to the following standards:

(a) The employer must be current with respect to all payroll reporting and payment due to any fund administered by the bureau.

(b) The employer must not have cumulative lapses in workers' compensation coverage in excess of forty days within the prior twelve months.

(2) After the first year of enrollment, an employer participating in the workplace wellness grant program shall be eligible to renew its application and continue participation at the discretion of the bureau.

(3) Applications submitted for the workplace wellness grant program may be processed and renewed by the bureau on a rolling basis.

(D) Disqualification from the workplace wellness grant program.

(1) An employer shall be immediately disqualified from the participation in the workplace wellness grant program if the employer is found by the bureau to have knowingly misrepresented information on the initial application for employee participation and compliance with program requirements.

As used in this paragraph, "knowingly" means that the employer had actual knowledge of the misrepresentation and was aware that the misrepresentation would cause a certain result.

(2) An employer shall be immediately disqualified from participation in the workplace wellness grant program if the bureau determines the employer has violated any state or federal statutes pertaining to confidential personal information and personal health information, including but not limited to the statutes and rules contained in rule 4123-10-04 of the Administrative Code.

(3) An employer shall be immediately disqualified from participation in the workplace wellness grant program if the bureau determines the employer has coerced employees to participate in the workplace wellness grant program. As used in this paragraph, "coerced" is defined as intimidating an employee to compel the individual to do some act against his or her will by the use of psychological pressure, physical force, or threats. The definition of coercion as stated in section 2905.12 of the Revised Code shall also apply to this paragraph.

(4) An employer shall be immediately disqualified from participation in the workplace wellness grant program if the bureau determines the employer eliminated jobs or reduced employment due to the implementation of its workplace wellness program.

(5) The bureau may disqualify an employer from the workplace wellness grant program if the bureau determines that the employer has not used the grant for the purposes of the workplace wellness grant program or has otherwise violated the written agreement.

(6) An employer shall be disqualified from continued participation in the workplace wellness grant program if the employer violated paragraph (C)(1) of this rule.

(7) An employer that is disqualified from participation in the workplace wellness grant program under the preceding paragraphs shall make restitution of all monies awarded by the bureau for participating in the program.

(8) Reconsideration of disqualification from workplace wellness program.

(a) An employer may request reconsideration from a decision finding the employer is disqualified from the workplace wellness program. The request must be in writing and filed with the superintendent of the division of safety and hygiene within thirty days of the notification of the decision.

(b) The employer may submit a request for reconsideration of the superintendent's decision to the adjudicating committee.

(c) The adjudicating committee shall consider the request and make a recommendation on the employer's eligibility to the administrator.

(d) The decision of the administrator shall be final.

(e) {Enter paragraph text here}

Last updated November 29, 2023 at 2:25 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 1/20/2012
Rule 4123-17-56.2 | Safety council rebate incentive program.
 

(A) Definitions.

For the purposes of this rule,

(1) "Local safety council" means an entity contracted with the bureau of workers compensation to provide a safety campaign in accordance with standards set forth by the superintendent of the division of safety and hygiene.

(2) "Program year" means July first to June thirtieth, inclusive.

(3) "Superintendent" means the superintendent of the division of safety and hygiene or the superintendent's designee.

(B) For each program year, the administrator may establish a safety council rebate.

(1) The superintendent shall determine safety council rebate eligibility requirements for each program year and publish such program requirements no later than sixty days prior to the start of the program year.

(2) The safety council rebate shall be equal to the amount identified in the appendix to rule 4123-17-75 of the Administrative Code times the employer's pure premium costs during the program year.

(C) Eligibility requirements.

(1) To receive a rebate as set forth in paragraph (B) of this rule the employer must meet the following criteria as of the application deadline:

(a) The employer must be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code.

(b) The employer must not have cumulative lapses in workers' compensation coverage in excess of forty days within the prior twelve months.

(c) The employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with such report before the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code.

(2) An employer shall not be eligible to receive a safety council rebate eligibility rebate as set forth in paragraph (B) of this rule if:

(a) The employer is a self-insuring employer providing compensation and benefits pursuant to section 4123.35 of the Revised Code.

(b) The employer is a state agency.

(c) The employer is participating in a program designated as incompatible with the rebate under rule 4123-17-74 of the Administrative Code.

(d) The employer is a client employer of an alternate employer organization (AEO).

(e) The employer is a client employer of a professional employer organization (PEO), to the extent the employers payroll is reported to the bureau under the PEOs workers compensation policy.

(3) An AEO or a PEO shall not be eligible to receive a safety council rebate under this rule unless all of the following requirements are met:

(a) The AEO or the PEO, and each of the client employers of the AEO or the PEO, meet all eligibility and program requirements.

(b) The AEO or the PEO electronically submits affirmation that the AEO or the PEO, and each of the client employers of the AEO or the PEO, has enrolled in a local safety council as of July thirty-first of the applicable program year.

(c) The AEO or the PEO submits a list of each of the client employers with whom it has an agreement as of May first of the applicable policy year.

(i) The list shall be electronically submitted on a form prescribed by the bureau, and shall include each client employer's name, address, federal tax identification number, bureau of workers' compensation risk number; and the amount of payroll, listed by manual class code, reported by the AEO or the PEO on behalf of each client employer.

(ii) If the bureau determines the AEO or the PEO has manipulated the client list for purposes of obtaining a safety council rebate under this rule, the AEO or the PEO shall not be eligible to receive such rebate.

(iii) The bureau shall hold the list required under this paragraph as confidential pursuant to rule 4123-17-15.2 of the Administrative Code.

(4) The forms and deadlines for meeting the requirements of paragraphs (C)(3)(b) and (C)(3)(c) of this rule shall be prescribed by the superintendent.

Last updated November 29, 2023 at 2:25 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 9/4/2014
Rule 4123-17-57 | Premium for construction industry.
 

(A) As used in this rule:

(1) As defined in division (F)(3) of section 4123.34 of the Revised Code, "construction industry" includes any activity performed in connection with the erection, alteration, repair, replacement, renovation, installation, or demolition of any building, structure, highway, or bridge. The manual classifications satisfying this definition are listed in paragraph (E) of this rule.

(2) "Construction industry employer" is an employer that reports payroll of a construction industry employee for work performed in a construction industry manual classification as defined in paragraph (E) of this rule.

(3) "Construction industry employee" is any employee as defined in division (A) of section 4123.01 of the Revised Code who performs work and whose payroll is properly reported in a construction industry manual classification as defined in paragraph (E) of this rule.

(B) Pursuant to division (F) of section 4123.34 of the Revised Code, the administrator shall determine the premium rates for construction industry employees for payroll paid beginning January 1, 1995, in accordance with the limitations provided in this rule.

(C) A construction industry employer shall report the actual remuneration paid to its construction industry employees, except that for payroll paid beginning January 1, 1995, the reportable payroll shall not exceed on a weekly basis an amount as provided in division (F) of section 4123.34 of the Revised Code. This limitation applies only to the construction industry employees of the construction industry employer, and does not apply to employees of a construction industry employer whose payroll is not reported in a construction industry manual classification as defined in paragraph (E) of this rule.

(D) The construction industry employer shall maintain records to verify the weekly wages paid to construction industry employees. The payroll limitation for construction industry employees shall apply to weekly payroll, regardless of the hourly or daily remuneration. If upon audit the construction industry employer is unable to document payroll records of an employee on a weekly basis, the bureau shall establish the payroll by the actual remuneration for the payroll reporting period, subject to the maximum limitation as provided in division (F) of section 4123.34 of the Revised Code times the number of weeks in the payroll reporting period.

(E) The payroll limitation of this rule shall apply only to the following construction industry manual classifications of a construction industry employer: all of the manual classifications in industry group four, except for manual classification 9009, as provided in the credibility table used for experience rating, table one, part B, of rule 4123-17-05 of the Administrative Code. The bureau shall periodically review the manual classifications satisfying the definition of construction industry, and any reclassifications, changes, deletions, or additions to the bureau's manual classifications or industry groups may result in additions or deletions of manual classifications from this rule.

(F) The payroll limitation of this rule shall apply to premium of the construction industry employer for construction industry employees reported under the manual classifications listed in paragraph (E) of this rule. The payroll limitation also applies to the administrative cost and disabled workers' relief fund assessments, and for such purposes the construction industry employer shall report the remuneration of the construction industry employees as provided in paragraph (C) of this rule.

(G) For a construction industry employee who is also an officer of a corporation, a sole proprietor, partnership, or member of a family farm corporation, and whose payroll is subject to a payroll limitation by rules 4123-17-07 and 4123-17-30 of the Administrative Code, any additional payroll limitations of this rule also may apply.

(H) If upon audit or reclassification of payroll the bureau determines that the payroll of an employee has been improperly classified in a construction industry manual classification and the new or proper manual classification is not a construction industry classification as defined in paragraph (E) of this rule, the bureau shall establish the premium due based upon the full actual remuneration of the employee.

Last updated May 31, 2023 at 1:07 PM

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date:
Rule 4123-17-58 | Drug-free safety program (DFSP) and comparable program.
 

(A) Definitions.

For purposes of this rule:

(1) "AEO" and "PEO" have the same meaning as defined in rule 4123-17-15 of the Administrative Code.

(2) "Application deadline" means the applicable deadline set forth in appendix A or in appendix B to rule 4123-17-74 of the Administrative Code.

(3) "Client employer" has the same meaning as defined in rule 4123-17-15 of the Administrative Code.

(4) "Comparable program" means a program referred to in section 153.03 of the Revised Code.

(5) "Drug-free safety program" or "DFSP" means the bureau's loss prevention and safety program to prevent and reduce the risk of workplace accidents and injuries attributed to the use and abuse of alcohol and other drugs, including prescription, over-the-counter, and illegal drugs.

(6) "Program period" means the policy year for which the employer elects to participate in DFSP.

(7) "Safety-sensitive position or function" means any job position or work-related function or job task designated as such by the employer, which through the nature of the activity could be dangerous to the physical well-being of or jeopardize the security of the employee, co-workers, customers or the general public through a lapse in attention or judgment.

(8) "Supervisor" means an employee who supervises others in the performance of their jobs, has the authority and responsibility to initiate reasonable suspicion testing and recommend or perform hiring or firing procedures.

(9) "Superintendent" means the superintendent of the division of safety and hygiene or the superintendent's designee.

(B) Eligibility requirements.

(1) To receive benefits under this rule, the employer must, as of the application deadline:

(a) Be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code;

(b) Not have cumulative lapses in workers' compensation coverage in excess of forty days within the twelve months preceding the application deadline;

(c) Be in an active policy status, which for purposes of this rule, does not include a policy that is a no coverage policy or a policy that is lapsed; and

(d) Report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the application deadline date set forth in rule 4123-17-74 of the Administrative Code.

(2) The following employers shall not be eligible for benefits under this rule:

(a) State agencies;

(b) Self-insuring employers providing compensation and benefits pursuant to section 4123.35 of the Revised Code.

(3) An AEO or a PEO shall not be eligible to receive benefits under this rule unless the AEO or the PEO and each of the client employers of the AEO or the PEO meet all eligibility and program requirements.

(4) An employer determined to be ineligible for participation in the DFSP based on the bureau's review of the employer's submitted application may appeal such determination to the adjudicating committee pursuant to section 4123.291 of the Revised Code.

(5) An employer that is found to be ineligible for participation in the DFSP may reapply for a subsequent program period.

(C) Basic DFSP level.

To implement a basic DFSP, an employer shall make annual application to the bureau by the application deadline and implement the program elements set forth in paragraphs (C)(1) to (C)(6) of this rule. The requirements and timeframes for completion of each element shall be determined by the superintendent.

(1) Safety - The DFSP shall include, but is not limited to the following:

(a) Completing and submitting the bureau's online safety assessment;

(b) Ensuring each supervisor completes accident-analysis training; and

(c) Utilizing online accident-analysis reporting on the bureau's website.

(2) Policy - Employers are required to put in place a written DFSP policy.

(3) Employee education - The DFSP shall include annual education for all employees.

(4) Supervisor skill-building training - The DFSP shall include annual training for all supervisors in support of enforcing the employer's written DFSP policy and procedures.

(5) Drug and alcohol testing - The DFSP program shall include alcohol and other drug testing which conforms to the federal testing model promulgated by the United States department of health and human services. The employer shall implement and pay for testing required by DFSP participation but is not required to pay for re-testing requested by an employee and follow-up testing. Testing shall occur as specified by the bureau including, but not limited to the following:

(a) Pre-employment and new-hire drug testing;

(b) Post-accident alcohol and other drug testing;

(c) Reasonable suspicion alcohol and other drug testing; and

(d) Return-to-duty and follow-up alcohol and other drug testing.

(6) Employee assistance - The DFSP shall include an employee assistance plan.

(D) Advanced DSFP level.

To implement an advanced DFSP, an employer shall make annual application to the bureau by the application deadline and implement the program elements set forth in paragraphs (D)(1) and (D)(2) of this rule. The requirements and timeframes for completion of each element shall be determined by the superintendent.

(1) The employer shall meet all of the requirements of a basic DFSP as provided in paragraph (C) of this rule.

(2) The employer shall do all of the following:

(a) Ensure that its written DFSP policy clearly reflects how random drug testing will be implemented and how additional employee assistance will be provided;

(b) Ensure conducting fifteen per cent or higher random drug testing of the employer's workforce each program period;

(c) Pre-establish a relationship for, and pay the costs of, a substance assessment of an employee who tests positive, comes forward voluntarily to indicate he or she has a substance problem, or is referred by a supervisor;

(d) Timely submit a safety action plan based on the results of the completed safety assessment which outlines specific safety process improvements the employer intends to implement during the remainder of the program period;

(e) Commit to not terminate the employment of an employee who tests positive for the first time, who comes forward voluntarily to indicate he or she has a substance problem, or who is referred by a supervisor for an assessment.

(E) Comparable program.

(1) Self-insuring employers and state-fund employers not participating in the DFSP shall submit an application for approval of a comparable program.

(2) Prior to providing labor services or on-site supervision of such labor services under a public improvement project as defined in division (A)(9) of section 153.03 of the Revised Code, employers participating in the comparable program shall:

(a) Develop, implement, and provide to all employees a written substance use policy the written policy required by division (B)(2)(a) of section 153.03 of the Revised Code;

(b) Complete all employee education required by division (B)(2)(d) of section 153.03 of the Revised Code; and

(c) Complete all supervisor training required by division (B)(2)(e) of section 153.03 of the Revised Code.

(F) Progress reporting and renewal requirements.

(1) In order to qualify for renewal, an employer shall have implemented all requirements of its basic or advanced level DFSP by the implementation date specified by the bureau.

(2) The employer shall submit an annual report detailing program implementation and reporting annual statistics on a form provided by the bureau. The requirements and timeframes for completion of the annual report shall be determined by the superintendent.

(a) If the employer is applying for renewal in the DFSP, the annual report shall be deemed the employer's annual application, and the employer shall identify which DFSP level is requested for the following program period;

(b) The employer shall provide any follow-up documentation required by the bureau and shall maintain on-site statistics as required by the bureau;

(c) The report required by this section and any other information submitted by the employer in meeting DFSP requirements shall be considered part of the annual statement submitted to the bureau as required by section 4123.26 of the Revised Code. The bureau shall hold such information as confidential pursuant to section 4123.27 of the Revised Code.

(3) In conjunction with the annual report required under paragraph (F)(2) of this rule, an AEO or a PEO participating in the DFSP must submit a client employer list.

(a) The list shall include all client employers with whom the AEO or the PEO had an agreement as of thirty days prior to the filing deadline for the annual report;

(b) The list shall include each client employer's name, address, federal tax identification number, bureau of workers' compensation policy number; and the amount of payroll, listed by classification code, reported by the AEO or the PEO on behalf of each client employer;

(c) If the bureau determines the AEO or the PEO has manipulated the client list for purposes of obtaining benefits under this rule, the AEO or the PEO shall not be eligible to receive such benefits;

(d) The bureau shall hold the list required under this section as confidential pursuant to section 4125.05 of the Revised Code.

(G) The bureau may remove an employer from participation in the DFSP for failure to fully implement a DFSP in compliance with the approved program level requirements. The bureau shall send written notice of cancellation to the employer. An employer removed from the DFSP under this section may reapply for the DFSP for the next program period. The bureau may deny the application based on circumstances of previous participation.

(H) An employer completing program requirements may be eligible for a bonus equal to the amount identified in the appendix to rule 4123-17-75 of the Administrative Code times the employer's pure premium costs during the program period. To be eligible for the bonus, an employer must report actual payroll due upon reconciliation of estimated premium and actual premium for the program participation year no later than the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with the payroll report before the expiration of any grace period established by the administrator pursuant to rule 4123-17-16 of the Administrative Code. Additional program requirements for bonus eligibility shall be determined by the superintendent of the division of safety and hygiene.

(I) Participation in this program under this rule is voluntary. Nothing contained in this rule shall affect, modify, or amend any collective bargaining agreement or alter the rights or obligations of an AEO, an employer, an employee, a client employer, a PEO, or a shared employee under applicable federal or state law. Provisions of a collective bargaining agreement that prevent implementation of program criteria will preclude employer participation in the program.

(J) Pursuant to section 4121.37 of the Revised Code, the administrator may establish a grant program to offset, in whole or in part, costs incurred by employers that implement a basic or advanced DSFP and meet such grant program's eligibility requirements.

Last updated February 28, 2022 at 3:46 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/2015
Rule 4123-17-59 | Fifteen thousand dollar medical-only program.
 

(A) Any employer who is paying premiums to the state insurance fund and whose coverage is in force may elect to participate in the fifteen thousand dollar medical-only program as provided in section 4123.29 of the Revised Code. No formal application is required; however, an employer must elect to participate by telephoning the bureau. Once an employer has elected to participate in the program, the employer will be responsible for all bills in all medical-only claims with a date of injury the same or later than the election date and the employer agrees to pay bills within thirty days of receipt of the bill, unless the employer notifies the bureau within fourteen days of receipt of the notification of a claim being filed that it does not wish to pay the bills in that claim, or the employer notifies the bureau that the fifteen thousand dollar maximum has been paid, or the employer notifies the bureau of the last day of service on which it will be responsible for the bills in a particular medical-only claim.

(B) Employers may pay bills only on any alleged medical-only injury. The provisions of this program and rule shall not apply to claims in which an employer with knowledge of a claimed compensable injury or occupational disease, has paid wages in lieu of compensation or total disability. Payment of a bill by an employer does not waive the bureau's right to adjudicate the claim, nor does it waive the employer's right to contest the claim should a claim be filed.

(C) This program in no way supersedes the right of any injured worker to file a workers' compensation claim with the bureau.

(D) An employer or its agent may elect to pay to the injured worker or the provider on behalf of the injured worker the first fifteen thousand dollars of a medical-only claim. Employers may elect which medical-only claims they do not wish to cover under this program.

(1) An employer electing to pay bills in its employees' medical-only claims is responsible for all bills in a claim until the fifteen thousand dollar maximum is reached and the employer provides notice to the bureau that the employer has paid the first fifteen thousand dollars of the bills in the claim by providing the bureau the date of service of the bill which reached the fifteen thousand dollar maximum, or the employer provides notice to the bureau that it no longer wishes to be responsible for the bills in a particular claim by providing the bureau the last date of service that it will pay. The bureau will process all related bills received after the withdrawal notification date.

(2) If the fifteen thousand dollar maximum has not been reached and the payment of a bill will exceed the fifteen thousand dollar maximum, the employer should pay that portion of the bill that will bring the payment to the fifteen thousand dollar maximum and inform the provider to bill the bureau for the remainder of the bill. The employer should then notify the bureau that the first fifteen thousand dollars has been paid, and provide proof of such payment and copies of all bills paid, in the proper billing format, to the bureau. The bureau will then be responsible for processing all future bills.

(3) The employer cannot elect to pay only certain bills for a claim and submit other bills in that claim to the bureau for payment.

(4) Once an employer has elected to pay bills in medical-only claims under this program, the employer must pay all bills under this program within thirty days of receipt of the bill. The employer shall provide copies of the bills paid in the claim, in the proper billing format, to the bureau and the injured worker or the injured worker's representative upon request. Upon written request from the bureau, the employer shall provide documentation to the bureau of all medical-only bills that they are paying directly. Such requests from the bureau may not be made more frequently than on a semiannual basis. Failure to provide such documentation to the bureau within thirty days of receipt of the request may result in the employer's forfeiture of participation in the program for such injury.

(E) An employer electing this program must keep a record of the injury to include: name, address, and social security number of the injured worker; date and time of injury; type of injury; part of body injured; and a brief description of the accident. The employer also shall keep a copy of all bills with proof and date of payment under this program. This information will be made available to the bureau and the injured worker or their representative upon request. The information must be kept on file for five years from the last date a bill has been paid by the employer or the information has been received by the bureau.

(1) An employer in the program must notify the bureau within fourteen days of a claim being filed of the employer's intention not to cover the first fifteen thousand dollars of the medical costs of the claim. This notification may be by telephone or in writing.

(2) The bureau will process all related bills in a filed medical-only claim in the normal manner unless the employer has previously notified the bureau that it has elected to participate in the fifteen thousand dollar program.

(3) In those cases in which the bureau has been properly notified by the employer of the employer's intention to directly pay the bills, the bureau shall not pay any bills submitted to the bureau directly from the provider but will notify the provider that the bill should be submitted to the employer until the provider is notified by the employer that the bureau is responsible for the bills in the claim. No interest shall be paid by the bureau on account of bills not paid within thirty days if such bills are the responsibility of the employer.

(4) All bills submitted to the bureau or the employer for payment must be in the proper billing format and must be received by the bureau or the employer within one year of the date of service on the bill.

(F) An employer electing this program has the responsibility to notify the injured worker and medical provider, in writing, of the acknowledgment of the alleged medical-only injury, that it has elected under section 4123.29 of the Revised Code to pay the first fifteen thousand dollars, that all bills should be submitted to the employer, and that the injured worker and the bureau should not be billed.

(1) Once an employer in this program pays a bill on a work-related injury the bureau will not reimburse that employer.

(2) In the event that a duplicate payment is made, it will be the employer's responsibility to seek reimbursement from the provider. The employer may request reimbursement of such bills from the provider, and the provider shall reimburse the employer where the bureau has paid the bill.

(3) In the event that a medical-only claim changes to a lost time claim, the bureau will not reimburse the employer for bills that have been paid by the employer under this program.

(G) The employer shall pay all bills as billed or agree upon an appropriate reimbursement level with the provider for claims with a date of injury prior to June 30, 2009. Providers must accept the bureau fee schedule as payment in full for claims with a date of injury on or after June 30, 2009. A certified health care provider shall extend to an employer who participates in this program the same rates for services rendered to an employee of that employer as the provider bills the administrator for the same type of medical claim processed by the bureau and shall not charge, assess, or otherwise attempt to collect from an employee any amount for covered services or supplies that is in excess of that rate. Providers may only balance bill the bureau on the occasion of a bill that would require an employer to exceed the fifteen thousand dollar maximum. The bureau will not mediate fee disputes between the employer and the provider. If an employer elects to enter the program and the employer fails to pay a bill for a medical-only claim included in the program, the employer shall be liable for that bill and the employee for whom the employer failed to pay the bill shall not be liable for that bill.

(H) Payments made by the employer in this program will not be charged to that employer's experience modification; however, if a claim has been filed with the bureau and bills paid by the bureau, these payments will be included in the employer's experience modification. The bureau will not adjust the employer's experience modification to remove such payments unless the employer has complied with this rule and the bureau has made such payments in contravention of this rule. Failure by an employer to make timely payments on all bills will not affect the coverage of that employer and will not obligate the bureau to pay interest to the medical provider; however, the bureau may exclude employers who do not make timely payment on all bills in this program from participation in this program. An employer may appeal a decision of the bureau excluding the employer from this program to the adjudicating committee under rule 4123-14-06 of the Administrative Code.

(I) An employer who elects to participate in this program may cancel its participation in the program at any time by telephoning the bureau. The bureau will process all related bills in all medical-only claims against that employer's account after the date of the telephone call.

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 7/1/2010
Rule 4123-17-60 | Annuity factors.
 

The administrator of workers' compensation, with the advice and consent of the bureau of workers' compensation board of directors, has authority to approve contributions made to the state insurance fund by employers pursuant to sections 4121.121, 4123.29, and 4123.34 of the Revised Code. The administrator hereby establishes annuity factors for use in establishing claims reserves and premium rates as indicated in appendixes A, B, C, D, and E to this rule. The basis and interest factor of each annuity factor table is indicated on the appendix.

View AppendixView AppendixView AppendixView AppendixView Appendix

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 12/31/1998, 12/31/2002, 12/31/2003, 12/31/2005, 12/31/2007, 12/31/2009, 12/31/2010, 9/30/2015
Rule 4123-17-61 | Criteria for group experience rating.
 

(A) The administrator shall offer a plan that groups employers for rating purposes. Individual employers shall retain their separate risk identity but shall be pooled and grouped for experience rating purposes only.

(B) In establishing a group for group experience rating purposes, the sponsoring group organization or individual employers in the group must satisfy all of the following requirements and must meet all the sponsorship rules as provided in rule 4123-17-61.1 of the Administrative Code:

(1) All of the individual employers within the group must be governing members of the sponsoring organization or the affiliate organization.

(2) An individual employer must have a policy in good standing with the bureau. "Policy in good standing" means the individual employer is current on all payments due to the bureau and is in compliance with bureau laws, rules, and regulations at the time of enrollment or reenrollment.

(3) The employers' business in the organization must be substantially similar such that the risks which are grouped are substantially homogeneous. A group shall be considered substantially homogeneous if the main operating classification codes of the risks as determined by the premium obligations for the rating year beginning two years prior to the coverage period are assigned to the same or similar industry groups, as determined by appendix A to rule 4123-17-05 of the Administrative Code. Industry groups seven and nine as well as eight and nine, and industry groups two and four as well as four, and six are considered similar.

(a) The bureau may allow an individual employer to move to a more homogeneous group, after September thirtieth for private employer groups and March thirty-first for pubic employer taxing district groups but before the first day of the policy year, if the individual employer:

(i) Is without a full year of recorded premium;

(ii) Is reclassified as a result of an audit; or

(iii) Fully or partially combines with another employer.

(b) An individual employer member of a continuing group who initially satisfied the homogeneous requirement shall not be disqualified from participation in the continuing group for failure to continue to satisfy such requirement.

(4) The group of employers must consist of at least one hundred individual members or a group where the aggregate workers' compensation premiums of the members are, as determined by the administrator, expected to exceed one hundred fifty thousand dollars during the policy year for which the application for group rating is made.

(5) As of the deadline for application for group experience rating set forth in appendix A and in appendix B to rule 4123-17-74 of the Administrative Code, each individual employer seeking to enroll in a group for workers' compensation coverage must meet the following requirements:

(a) The individual employer must be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code;

(b) The individual employer must be current on the payment schedule of any part-pay agreement into which it has entered for payment of premiums or assessment obligations;

(c) The individual employer cannot have cumulative lapses in workers' compensation coverage in excess of forty days within the prior twelve months; and

(d) The individual employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year.

(6) Cancellations, transfers, and combinations.

(a) An individual employer whose coverage status becomes cancelled or combined during the rating year may not continue to participate in group experience rating. The effective date of the removal from the group experience rating program shall be on the first day of the next policy year, unless the date of cancellation or combination is determined to be the first day of the policy year, in which case the individual employer shall be removed from group as of the actual date of cancellation or combination. An individual employer who becomes active and obtains coverage after the group experience rating application deadline may not participate in group experience rating for that year except as defined in rule 4123-17-66 of the Administrative Code.

(b) An individual employer that obtains initial coverage after the group experience rating application deadline as set forth in appendix A and in appendix B to rule 4123-17-74 of the Administrative Code and for which a transfer of experience is indicated under rule 4123-17-02 of the Administrative Code may not participate in group experience rating for that year except as defined in rule 4123-17-66 of the Administrative Code.

(7) Payroll reporting and premium reconciliation. An individual employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the date set forth in rule 4123-17-14 of the Administrative Code. An individual employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with the payroll report before the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code.

(a) An individual employer removed from group experience rating for failure to meet these criteria will be rerated for the full policy year at the individual employers base-rate or experience-modified rate as determined by their expected losses for the policy year.

(b) The group shall retain, for the policy year, the experience of any employer removed from group experience rating for failure to meet these criteria.

(C) In providing employer group plans under section 4123.29 of the Revised Code, the bureau shall consider an employer group as a single employing entity for purposes of group experience rating. No employer may be a member of more than one group for the purpose of obtaining workers' compensation coverage.

Last updated July 27, 2023 at 8:46 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29
Five Year Review Date:
Rule 4123-17-61.1 | Sponsorship certification requirements.
 

(A) The following certification requirements shall apply to all sponsoring organizations that seek to make application for either the group rating plan, as provided for in rule 4123-17-61 of the Administrative Code, or the group retrospective rating plan as provided in rule 4123-17-73 of the Administrative Code, known collectively as group programs.

(B) The sponsoring organization must have been in existence for at least two years prior to the last date upon which the group's application for coverage may be filed with the bureau of workers' compensation as provided in rule 4123-17-62 of the Administrative Code.

(C) The organization must be formed for a purpose other than that of obtaining group workers' compensation coverage. The bureau shall require the organization to demonstrate this through submission of required evidence and documentation. As long as all of the other criteria of this rule are satisfied, a parent corporation may be a sponsoring organization and, if it qualifies under the criteria of this rule, a member of a group of its subsidiary corporations for purposes of group programs. A sponsoring organization may sponsor more than one group.

(D) The formation and operation of a group program in the organization must substantially improve accident prevention and claims handling for the employers in the group. The bureau shall require the group to document its plan or program for these purposes, and, for groups reapplying annually for group coverage, the results of prior programs.

Following the conclusion of each policy year, the bureau will report annually on the aggregate performance of all groups.

(E) A sponsoring organization shall satisfy all of the requirements for a sponsoring organization as required under section 4123.29 of the Revised Code and in this rule. A sponsoring organization shall submit to the bureau information to demonstrate that the organization meets the requirements for sponsorship. The bureau shall review the information and shall register the sponsoring organization if it meets the requirements. A sponsoring organization shall be registered and be certified by the bureau prior to marketing to or soliciting employers for membership in a group under the group programs.

(1) .Once the bureau certifies a sponsoring organization, the sponsoring organization shall be permitted to sponsor a group retrospective rating program under rule 4123-17-73 of the Administrative Code, as well as groups in the current group experience rating program under this rule beginning the next rating year. The bureau shall review the certification of a sponsoring organization at least once every three years or on a more frequent basis as determined by the bureau.

(2) A sponsoring organization that seeks to be certified by the bureau shall provide to the bureau the following:

(a) The sponsoring organization's workers' compensation policy number and proof of active workers' compensation coverage;

(b) The name of the sponsoring organization's third party administrator, if applicable;

(c) A copy of the sponsoring organization's marketing materials (web site, brochures, etc.), including a description of the services related to group rating as well as other services provided by the sponsor;

(d) A list of all sponsoring organizations affiliated with the sponsoring organization. For the purpose of this rule, an "affiliated" organization is an organization in which members are brokered, borrowed, shared, or co-opted for inclusion in the certified sponsoring organization's group. All affiliated organizations are required to be certified sponsors as provided in this rule.

(e) A copy of the sponsoring organization's articles of incorporation;

(f) A copy of the sponsoring organization's mission statement;

(g) A completed application form, signed by the sponsor, which includes disclosure of nine-hundred-ninety filings with the Internal Revenue Service and counts of all members (both group and non-group);

(h) A copy of the sponsor's safety plan.

(i) With reasonable notice, the bureau may request that a sponsor provide for the bureau's inspection at the sponsor's designated location any of the following: additional financial information, dues structure, revenue sources, a table of organization, a comprehensive membership roster, by-laws, and/or a list of corporate officers.

(F) The sponsoring organization shall provide to the bureau a signed statement certifying the accuracy of the information provided to the bureau. A sponsoring organization's failure to provide accurate information or submission of false information may be grounds for the bureau to refuse to certify the sponsoring organization or to decertify the sponsoring organization. The bureau reserves the authority to use all the listed information above and any other information available to make the certification approval.

(G) Should the bureau deny the certification of the sponsoring organization, the applicant may appeal to the bureau adjudicating committee. After exhausting all administrative appeals and correction of sponsorship requirement deficiencies, the applicant may reapply one year after the latest certification denial.

(H) The bureau will collect this information and retain it or ask that a sponsoring organization maintain the information for bureau inspection upon request.

(I) The sponsoring organization shall be in compliance with all bureau rules. A sponsoring organization's non-compliance may result in decertification.

(J) The sponsoring organization, or their authorized representative, shall have the capability to send and receive secure electronic (FTP - file transfer protocol) files.

(K) Group marketing.

(1) A sponsoring association, affiliate, or representative, including, but not limited to, a third-party administrator, broker, or marketer may not offer a discount to either a private or public employer either seeking to participate in a group-experience rating plan or that exceeds the combined result of the lowest experience modifier and its associated break-even factor for the future policy year until those factors are approved by the bureau's board of directors. Those parties also may not provide marketing material that is either false or unattainable relating to the process of forming groups under the group-retrospective rating plan for a future policy year. Prohibited marketing material under this rule is any communication that:

(a) Instructs prospective participants to provide false information on forms used for purposes of group formation, including the AC-3, the AC-26, and the U-153.

(b) Claims the sponsoring association, affiliate, or representative is endorsed by the bureau or the state of Ohio.

(c) Offers or estimates specific discounts or refunds that are unattainable to prospective participants in either group-experience rating or group-retrospective rating.

(i) For group-experience rating, "unattainable" is defined as exceeding the maximum discount when combining the lowest experience modifier and its associated break-even factors as approved by the bureau of workers' compensation board of directors.

(ii) For group-retrospective rating, "unattainable" is defined as quoting a specific refund amount that exceeds the maximum possible refund when considering the basic premium factor for the maximum premium ratio selected as approved by the bureau of workers' compensation board of directors.

(2) The bureau may apply the following sanctions upon its determination of a violation of this rule:

(a) For a violation of paragraph (K)(1)(c) of this rule the bureau may place that group sponsor at capacity for the an upcoming policy year.

(i) For sponsors that filed group rosters with the bureau for the policy year, "capacity" is defined as prohibiting a sponsoring association from exceeding the total number of employers in their current or most recent groups, adding new employers for groups they may form in the policy year of the sanction, and affiliating with any other group sponsors for the policy year of the sanction.

(ii) For sponsors that have not filed group rosters with the bureau for the current policy year, "capacity" means they will not be able to form groups and cannot affiliate with other group sponsors for the upcoming policy year.

(b) For a violation of paragraph (K)(1)(a) or (K)(1)(b) of this rule, along with any action that results in knowingly falsifying information on forms submitted to the bureau, the bureau shall immediately revoke the sponsor's certification for the upcoming policy year.

(3) The bureau will provide the bureau of workers' compensation board of directors a report by no later than the April board meeting each year regarding sanctions rendered under this paragraph and corrective actions taken by the bureau with respect to this rule.

Last updated May 31, 2023 at 1:07 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 9/14/1992, 3/9/2009
Rule 4123-17-62 | Application for group experience rating.
 

(A) Sponsoring organization requirements.

(1) A sponsoring organization shall make annual application for group experience rating by submitting an employer roster for group rating plan (AC-25) for each group it sponsors. Each AC-25 shall:

(a) Be signed each year by an officer of the sponsoring organization to which the members of the group belong;

(b) Identify each individual employer to be included in the group policy year for which the group application is made; and

(c) Identify whether, in the previous policy year, each employer was:

(i) Enrolled in the same group,

(ii) Not enrolled in the same group, but enrolled in a different group sponsored by the sponsoring organization, or

(iii) Not enrolled in the same group, and not enrolled in a different group sponsored by the sponsoring organization.

(2) In the manner specified by the bureau, the sponsoring organization shall annually identify all employers that were enrolled in the group in the previous policy year but are not enrolled in the group for the policy year for which the current application is made, and specify whether the employer is enrolled in another group of the same sponsoring organization.

(3) The bureau may request from individual employers or the sponsoring organization any additional information necessary for the bureau to rule upon the application for group experience rating. Failure or refusal of the sponsoring organization to provide the requested information in the manner requested by the bureau shall be sufficient grounds for the bureau to reject the application and refuse the group's participation in group experience rating.

(4) A sponsoring organization's application for group experience rating is effective for a single policy year. Continuation of a group for subsequent years requires timely filing of an application on a yearly basis and meeting eligibility requirements set forth in rule 4123-17-61 of the Administrative Code.

(B) Employer requirements.

An employer electing to participate in group experience rating must file an application for group rating (AC-26) with the sponsoring organization of the group in which the employer seeks to participate. If the sponsoring organization elects to include the employer in its group, the sponsoring organization must file the AC-26 form electronically with the bureau by the group experience rating application deadline set forth in the appendices to rule 4123-17-74 of the Administrative Code.

(1) An employer's AC-26 shall remain in effect for all subsequent policy years when the employer remains in the same group or another group sponsored by the same sponsoring organization.

(2) The employer must file an AC-26 if the employer applies for group experience rating with a different sponsoring organization or was not group-experience rated in the previous rating year.

(3) When an employer files a new AC-26 or multiple AC-26 forms during the application period, the latest-filed AC-26 shall establish the employer's intentions for group experience rating. The employer's AC-26 shall remain effective until any of the following occurs:

(a) The employer timely files a subsequent AC-26 indicating the desire to participate in a group with a different sponsor for the upcoming policy year;

(b) The sponsoring organization for the group does not include the employer on the group roster (AC-25);

(c) The group does not reapply for group experience rating or is rejected for failure to meet group eligibility requirements; or

(d) The employer fails to meet individual eligibility requirements set forth in paragraph (B) of rule 4123-17-61 of the Administrative Code.

(C) For private employers, the sponsoring organization shall file applications on or before the date identified in appendix A to rule 4123-17-74 of the Administrative Code. For public employers, the sponsoring organization shall file applications on or before the date identified in appendix B to rule 4123-17-74 of the Administrative Code.

(1) Except as provided in rule 4123-17-69 of the Administrative Code, a sponsoring organization may not add an employer to a group after the application deadline. A sponsoring organization will be permitted to correct a clerical error that results in an employer being omitted from a group roster if:

(a) The sponsoring organization has made an error in reporting the name or risk number of the employer on the sponsoring organization's AC-25; or

(b) The sponsoring organization included the employer on the sponsoring organization's AC-25, but failed to file the employer's AC-26 with the bureau prior to the application deadline. The sponsoring organization must provide sufficient documentation, as determined by the bureau, that the employer timely filed its AC-26 with the sponsoring organization.

(2) A sponsoring organization that has applied for group experience rating may not voluntarily terminate the application during the bureau's evaluation period.

(3) Any changes to the sponsoring organization's original application must be filed in a manner prescribed by the bureau prior to the application deadline. Any rescissions made must be completed in writing, signed by an officer of the sponsoring organization to which the members of the group belong. Any changes received by the bureau after the application deadline will not be honored. The latest application form or rescission received by the bureau prior to the application deadline will be used to determine the premium obligation for the group.

(D) A sponsoring organization shall notify an employer that is participating in a group of that sponsoring organization if the employer will not be included in a group by that sponsoring organization for the next rating year.

(1) For private employer groups, the sponsoring organization shall notify the employer in writing prior to the last business day of October of the year of the group application deadline set forth in appendix A to rule 4123-17-74 of the Administrative Code.

(2) For public employer taxing district groups, the sponsoring organization shall notify the employer in writing prior to the last business day of April of the year of the group application deadline set forth in appendix B to rule 4123-17-74 of the Administrative Code.

(3) If an employer notifies the bureau that a sponsoring organization has not complied with this paragraph and the sponsoring organization fails to prove that the notice was provided in a timely manner, the bureau will, without the approval of the sponsoring organization, allow the employer to remain in the group for the rating year for which the notice was required. If that group no longer exists the bureau will, without the approval of the sponsoring organization, place the employer in a homogeneous group with the same sponsoring organization or take other appropriate action.

(E) When the bureau determines that individual employers in a proposed group do not meet the eligibility requirements set forth in rule 4123-17-61 of the Administrative Code, the bureau will notify the individual employers and the sponsoring organization of its determination. The sponsoring organization may continue in its application for group coverage without the disqualified employers, but the group must meet minimum requirements of rule 4123-17-61 of the Administrative Code.

(F) A sponsoring organization may request that an employer be removed from its group for a gross misrepresentation made on the employer's application to the group.

(1) "Gross misrepresentation" is an act by the employer that would cause financial harm to the other members of the group, and is limited to any of the following:

(a) The sponsoring organization discovers that the employer applicant for group experience rating has recently merged with one or more entities without disclosing such merger on the employer's application for membership in the group, and such merger adversely affects the experience modification (EM), as defined in rule 4123-17-03 of the Administrative Code, of the group.

(b) The sponsoring organization discovers that the employer applicant for group experience rating has failed to disclose the true nature of the employer's business pursuit on its application for membership in the group, and this failure adversely affects the EM of the group.

(2) Requests for removal of an employer pursuant to this paragraph must be submitted within thirty days of the bureau's notification to the sponsoring organization that a rate adjustment has occurred. The sponsoring organization must notify the employer of its request to remove the employer from the group for gross misrepresentation.

(3) The sponsoring organization must provide sufficient documentation, as determined by the bureau, to support its request to remove an employer from a group.

(4) The employer shall be removed from the group only with the bureau's approval.

Supplemental Information

Authorized By: 4121.121, 4121.13, 4121.30
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 3/30/2009
Rule 4123-17-63 | Eligibility for group experience rating-size criteria.
 

(A) To be eligible for group experience rating, the group taken as a whole must include at least one hundred employers, each employer being identified as a separate risk for state fund identification purposes, or the group taken as a whole must be of sufficient size that the premiums of the members, as determined by the administrator, are expected to exceed one hundred fifty thousand dollars during the coverage period, except as provided by paragraph (C) of this rule. The administrator may determine the aggregate premium of the members based upon the historical premium experience of the members, projected payroll, and anticipated premium rates. The evaluation period for determining aggregate premium shall be the rating year beginning two years prior to the coverage period.

(B) For a group of less than one hundred members, the premium requirement shall be deemed to have been satisfied if the aggregate premium to the state insurance fund for the members of the group for the rating year beginning two years prior to the coverage period exceeded one hundred fifty thousand dollars, except as provided by paragraph (C) of this rule. Failure to reach one hundred fifty thousand dollars in premium during the coverage period shall not negate the group coverage.

(C) The bureau shall calculate the premium based upon the actual experience modified premium of the member employers during the evaluation period, including any modification due to group rating. The administrator may waive the requirement that premiums exceed one hundred fifty thousand dollars during the coverage period for a continuing group of substantially similar membership if the sole reason that the premium fails to exceed one hundred and fifty thousand dollars is due to the premium modification discounts earned by the group as a direct result of safety operations of the group rating program, and not due to other factors, such as a departure of members from the group or a reduction in payroll for members of the group.

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date:
Prior Effective Dates: 10/2/1990, 9/14/1992
Rule 4123-17-65 | Experience retention for group experience rate calculation purposes.
 

Effective for the rating year beginning July 1, 1995, for private employers, and the rating year beginning January 1, 1996, for public employer taxing districts, if an individual employer is a member of a group for group experience rating and leaves the group, the experience of that individual employer shall be used in experience-rating calculations for the group to impact only the rating years that the employer was a member of the group. The individual employer leaving the group retains its own experience rating incurred while a member of the group for the balance of the standard experience period. The group shall not be liable for claims experience incurred by an individual employer for claims occurring after the employer has left the group.

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date:
Prior Effective Dates: 10/2/1990
Rule 4123-17-66 | Termination and transfers for group experience rating.
 

This rule on termination and transfer of group experience rating shall apply at the group level after the bureau applies the applicable individual rules on transfer of experience.

(A) A group formed for the purpose of group experience rating may not retroactively include experience in a plan, exclude experience from a plan, or voluntarily terminate a plan during the policy year. A change in the name of the group will not constitute a new group. A change of the organization sponsoring a group or moving a group to a new sponsoring organization shall constitute a new group and the members of the new group must meet the homogeneity requirement of paragraph (B)(3) of rule 4123-17-61 of the Administrative Code. The amendments contained in this paragraph of this rule shall be effective for rating years beginning July 1, 2002, and thereafter. A group will be considered a continuing group if more than fifty per cent of the members of the group in the previous rating year are members of the group in the current rating year.

(B) Successor: Files petition for bankruptcy

Predecessor: No predecessor

An individual employer which is a member of a group for the purpose of experience rating and which becomes a debtor-in-possession during the policy year shall remain a member of the group for the entire policy year.

(C) Successor: Entity not having coverage

Predecessor: Group rated with employees and reported payroll

Where one legal entity not having coverage in the most recent experience period wholly or partially succeeds another legal entity in the operation of a business, and the predecessor entity was a member of a group for experience rating, the successor shall be considered a member of the group and the successor entity's rate shall be based on the group's experience, as long as the successor employer is homogeneous to the group. For a partial transfer, the effective date of the group experience transfer shall be on the first day of the next payroll reporting period (January first or July first).

(D) Successor: Group rated

Predecessor: Experience rated (either individually or in a different group), or non-group base rated

Where a legal entity having established coverage is a member of a group for experience rating and wholly succeeds another legal entity, the successor entity shall remain a member of the group for experience rating and the experience of the predecessor shall be included with the experience of the group for the purpose of experience rating.

(E) Successor: Non-group rated

Predecessor: Group rated

Where a legal entity having established coverage is a member of a group for the purpose of experience rating and is wholly succeeded by another legal entity which is not a member of the group, the successor entity shall not become a member of the group.

(F) Successor: Group rated

Predecessor: Group rated

Where a legal entity which is a member of group for the purpose of experience rating wholly succeeds another legal entity which is also a member of the same group for the purpose of experience rating, the successor entity shall remain a member of the group for the purpose of experience rating.

(G) Successor: Group rated

Predecessor: Self-insured

When an individual employer which has returned to the state insurance fund from self-insured status and has used the self-insured experience in calculating the experience rate becomes a member of a group for the purpose of experience rating, the self-insured experience shall be included in the experience of the group for experience rating purposes. Upon returning to the state insurance fund the employer shall provide the bureau with a payroll, a list of all claims incurred while the employer was self-insured and all payments made with respect to those claims, and any additional information required by the bureau to calculate the employer's experience.

(H) Successor Group rated

Predecessor: Non-group rated

Where a legal entity succeeds in the operation of a portion of a business of another legal entity and the successor entity is a member of a group for experience rating, the successor entity shall remain a member of the group for experience rating and the experience of the predecessor shall be included with the experience of the group for the purpose of experience rating. The effective date of the group experience transfer shall be on the first day of the next payroll reporting period (January first or July first).

(I) Successor: Non-group rated

Predecessor: Group rated

Where a legal entity having established coverage succeeds in the operation of a portion of a business of another legal entity and the successor entity is not a member of a group and the predecessor is a member of a group for experience rating, the successor entity will not become a member of the group for experience rating and the predecessor will remain a member of the group.

(J) Successor: entity not having coverage

Predecessor: Group rated with no employees and no reported payroll

Where one legal entity not having coverage in the most recent experience period wholly or partially succeeds another legal entity in the operation of a business, and the predecessor entity was a member of a group for experience rating, the successor entity shall not become a member of the group unless and until the entity applies for membership in the group in the next experience period.

(K) When any combination or transfer of experience is indicated, the effective date of such combination or transfer shall be the beginning date of the next following payroll reporting period. In cases where an entity not having coverage wholly succeeds another entity, the effective date shall be the actual date of succession.

(L) An individual employer which is a member of a group for the purpose of experience rating may not participate in a retrospective rating plan during the policy year in which the employer is a member of the group.

Supplemental Information

Authorized By: 4121.121, 4121.13, 4121.30
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 10/2/1990, 7/1/2001
Rule 4123-17-67 | Representation for group experience rating.
 

(A) A group that has been established and has been accepted by the bureau of workers' compensation for the purpose of group experience rate calculation shall have no more than one permanent authorized representative for representation of the group and the individual employers of the group before the bureau and the industrial commission in any and all risk-related matters pertaining to participation in the workers' compensation fund.

(B) The selection of an authorized group representative must be made by submission of a completed form AC-24, and any change or termination of the authorized group representative can be made only by a subsequent submission of form AC-24. Only an officer of the group may sign an AC-24.

(C) Notwithstanding the provisions of paragraph (A) of this rule, an individual risk in a group may retain the services of an attorney or other authorized representative for claims-related matters, such as representation at claims hearings before the bureau and the industrial commission, through submission of the appropriate authorization for representation in such individual claim files. The bureau will recognize only one authorized representative for notice and appeal purposes.

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29
Five Year Review Date:
Rule 4123-17-68 | Group experience and group retrospective safety program requirements.
 

(A) The purpose of this rule is to establish minimum safety requirements for group experience and group retrospective rating as provided by section 4123.29 of the Revised Code.

(B) The bureau safety and hygiene division, upon the request of the sponsoring organization, shall provide assistance with implementing all of the provisions of this rule.

(C) The primary or affiliated sponsoring organization of a group experience or group retrospective plan shall document its program to improve accident prevention and claims handling for the members in the group with the group application, and, for an existing group reapplying for group coverage annually, shall document the effectiveness of prior programs and any proposed improvements to these programs. This analysis shall include identification of the most common injuries among group members and strategies aimed at increasing awareness and prevention of these injuries.

(1) A bureau division of safety and hygiene loss prevention representative shall review the sponsor's safety requirements annual report within sixty days of receipt. The safety and hygiene representative shall contact the primary or affiliated group sponsor or its authorized representative to assist in further developing appropriate safety strategies if there are deficiencies in the report. All primary and affiliated sponsoring organizations shall be required to sponsor a minimum of eight hours of safety training during the rating year for members of their group. Training shall be hosted by the sponsor or the sponsor's third party administrator. Training should be designed in increments of at least two hours. Training should be industry specific where possible. Webinars and online training hosted by the sponsor will qualify to fulfill this requirement. The sponsor must document the number of employers in attendance at safety training with a goal of at least fifty per cent membership attendance. If the same agenda is offered repeatedly in different regional sites, hour to hour credit will be granted. A bureau representative may attend training to ensure the requirement is being met.

(2) If an employer that participates in group rating or group retrospective rating plan sustains a claim within the "green period," the employer shall complete either of the following:

(a) The bureau's online accident analysis form and the bureau's associated online safety class, or

(b) Two hours of safety training approved by the bureau. Such training can be offered by the sponsoring organization, the sponsoring organization's third party administrator, or the bureau.

The sponsor will notify members of this requirement and maintain recordkeeping to track completion of this requirement. The sponsor will submit to the bureau a list of members completing the training required by this rule. The bureau shall reserve the right to request additional information from the sponsor to ensure compliance.

(3) The bureau safety and hygiene division shall make a recommendation to the bureau employer programs unit on whether the group's safety requirements annual report is acceptable for the following policy year. A copy of the recommendations and findings of the safety and hygiene division shall be communicated to the sponsoring organization or its authorized representative at the same time. The employer programs unit shall consider this recommendation in making its decision whether to approve the group rating application and at the time of sponsor recertification.

(4) The bureau safety and hygiene division shall evaluate the sponsor's safety requirements annual report at the sponsoring organization level and not at the individual member level. The bureau safety and hygiene safety representative may conduct member visits to confirm the sponsoring organization requirements are met.

(5) If the bureau's employer programs unit does not approve a group for group rating based upon the sponsor's safety activities, the sponsoring organization may request a hearing before the adjudicating committee pursuant to rule 4123-14-06 of the Administrative Code.

(6) Primary and affiliated sponsoring organizations shall publish in the first quarter of the rating year, for the knowledge of the members in their group, a safety accountability letter outlining the group rating safety requirements and responsibilities of all associated parties.

(D) The sponsoring organization shall provide information regarding safety resources to members in their group. Communication and education strategies of the sponsoring organization may include use of the following strategies: web sites, webinars, claims review and analysis, newsletters, seminars, professional consultants, videos, personal contact, brochures, booklets, manuals, identifying key personnel and training in safety management for the sponsoring organization staff and/or its members. The bureau safety and hygiene division representative will be added to all member distribution lists to monitor safety education activity.

(E) Linkage of the group-sponsoring organization with the division of safety and hygiene may include the following strategies:

(1) The bureau shall link each sponsoring organization with a service representative from safety and hygiene.

(2) Safety and hygiene shall assist the group with its development of safety strategies.

(3) Safety and hygiene and the sponsoring organization may sponsor joint seminars.

(4) The safety and hygiene representative shall provide a list of resources and expertise within each region upon request.

(5) The sponsoring organization shall promote bureau safety and hygiene services to its members.

(6) Safety and hygiene may provide training sessions and written safety and health materials.

(7) Bureau safety and hygiene division consultation services may be utilized by member companies for customized safety management assistance.

(8) Safety and hygiene and the sponsoring organization may develop joint programs in response to member needs.

(F) The division of safety and hygiene shall schedule annual regional training seminars for sponsoring organizations. Each sponsoring organization must send at least one representative to the seminar. Additionally, the division of safety and hygiene shall develop a list of publications and support materials that assist the sponsoring organization in reinforcing the safety guidelines of this rule.

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 7/1/2012
Rule 4123-17-69 | Grow Ohio incentive program.
 

(A) The following definitions apply to this rule:

(1) "Continuing eligibility evaluation date" means each April first of the program eligibility period for private employers and each October first of the program eligibility period for public employer taxing districts.

(2) "Initial application for coverage" means the employers initial application for coverage provided for in paragraph (A) of rule 4123-17-13 of the Administrative Code.

(3) "Initial rating year" means the rating year including the date on which the new employer's coverage becomes effective.

(4) "New employer" means an employer creating one or more jobs in the state of Ohio on or after July 1, 2011, and for which any of the following is true:

(a) The employer is a new business entity made amenable to Ohio workers' compensation laws by such job creation; or

(b) The employer is an out of state employer that has not had prior operations in Ohio and has not had prior workers' compensation insurance coverage in Ohio.

(5) "Program eligibility period" means the new employer's initial rating year and the two consecutive policy years thereafter.

(B) Grow Ohio incentive program.

(1) To encourage the development of jobs in Ohio, the administrator shall provide all new employers eligible for the grow Ohio incentive program a twenty-five per cent premium discount, as described in paragraph (B)(2) of this rule, or, if elected by the new employer, a waiver to allow application for the group experience rating program, as set forth in paragraph (B)(3) of this rule.

(2) Twenty-five per cent premium discount.

(a) The administrator shall apply the twenty-five per cent premium discount to the new employers total blended premium on the employer's invoice;

(b) The discount shall be applied to the premiums assessed on the new employer for the duration of the program eligibility period, unless at least one of the following situations apply:

(i) The employer elects, either through the one-time exception set forth in paragraph (B)(3) of this rule or through the annual application cycle for group experience rating established in rule 4123-17-62 of the Administrative Code, to participate in the group experience rating program.

A new employer that exits the group experience rating program during the program eligibility period and is not otherwise prohibited from participation in the grow Ohio incentive program by this rule shall be eligible to receive the discount for any remaining policy years in the program eligibility period.

(ii) The employer elects to participate in a program that is incompatible with the grow Ohio incentive program under rule 4123-17-74 of the Administrative Code.

(iii) The employer fails to report actual payroll for the initial rating year or fails to pay any premium due upon reconciliation of estimated premium and actual premium for the initial rating year by the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with such report before the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code.

(iv) The employer is ineligible for continued participation in the program under paragraph (D) of this rule.

(c) The discount shall not apply to:

(i) The non-refundable application fee as outlined in paragraph (A)(1) in rule 4123-17-13 of the Administrative Code;

(ii) Any premiums or assessments due by the employer for not complying with Ohio law as outlined in in paragraph (C) rule 4123-17-13 of the Administrative Code;

(iii) Any findings of premium deficiencies resulting from a premium audit pursuant to rule 4123-17-17 of the Administrative Code, if the bureau determines that the employer has misrepresented payroll or failed to submit payroll for any period; and

(iv) The minimum administrative charge set forth in rule 4123-17-26 of the Administrative Code.

(3) Application for group experience rating.

(a) If a new employer elects to apply for the group experience rating program under this rule, the administrator shall waive the deadlines set forth in appendix A or in appendix B to rule 4123-17-74 of the Administrative Code and allow the new employer to apply for the group experience rating program. A new employer participating in the group experience rating program must file an AC-26 form for the group with the sponsoring organization.

(b) A sponsoring organization shall not permit a new employer to participate in a group unless the new employer meets group homogeneity requirements set forth in rule 4123-17-61 of the Administrative Code. A sponsoring organization shall notify the bureau of the addition of the new employer to a group within thirty days of the date the bureau assigns a policy number to the new employer. The sponsoring organization shall electronically submit to the bureau the new employer's AC-26 with a statement identifying the group in which the new employer is being placed for the employer's initial rating year.

For employers making the election under paragraph (B)(3)(a) of this rule between the twenty-ninth day before the applicable group experience rating deadline set forth in appendix A or in appendix B to rule 4123-17-74 of the Administrative Code and the last day of the initial rating year, inclusive, the sponsoring organization shall also, within thirty days of the date the bureau assigns a policy number to the new employer, electronically submit to the bureau the new employer's AC-26 with a statement identifying the group in which the new employer is being placed for the rating year immediately following the employer's initial rating year.

(c) The new employer's participation in the group experience rating program in rating years subsequent to the rating year or rating years for which the new employer was admitted to a group under the administrator's waiver of the group experience rating deadline under this section is subject to all requirements for participation in the group experience rating program set forth in rules 4123-17-61 to 4123-17-68 of the Administrative Code.

(C) Initial eligibility for the grow Ohio incentive program.

(1) The following employers shall not be eligible to participate in the grow Ohio incentive program:

(a) An alternate employer organization or professional employer organization as defined in rule 4123-17-15 of the Administrative Code;

(b) A self-insuring employer providing compensation and benefits pursuant to section 4123.35 of the Revised Code, or a state fund employer who has previously provided compensation and benefits pursuant to section 4123.35 of the Revised Code;

(c) A public employer that is not a community school established under Chapter 3314. of the Revised Code or a public-private partnership securing workers compensation insurance under section 4123.03 of the Revised Code;

(d) An employer for which a combination or transfer of experience is indicated under rule 4123-17-02 of the Administrative Code;

(e) An employer that the bureau determines, after reviewing the information submitted with the initial application for rating is essentially the same employer, regardless of entity type, for which risk coverage previously had been provided; and

(f) An employer that elects to participate in a program that is incompatible with the grow Ohio incentive program under rule 4123-17-74 of the Administrative Code.

(2) An employer determined to be ineligible for the grow Ohio incentive program under paragraph (C)(1)(c), (C)(1)(d), or (C)(1)(e) of this rule based on the bureau's review of the information submitted with the initial application for coverage may appeal such determination to the adjudicating committee under section 4123.291 of the Revised Code.

(D) Continuing eligibility for the grow Ohio incentive program.

(1) An employer participating in the grow Ohio incentive program shall be eligible to continue its participation in the program beyond the employer's initial policy year only if the employer has completed the safety program requirements set forth in policy established by the bureau by the following deadlines:

(a) The last business day of December for an initial policy with an effective date of January first through and including June thirtieth; and

(b) The last business day of June for an initial policy with an effective date of July first through and including December thirty-first.

(2) An employer participating in the grow Ohio incentive program shall be eligible to continue its participation in the program only if, as of each continuing eligibility evaluation date, the employer holds active workers' compensation coverage and the employer must:

(a) Be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code;

(b) Be current on the payment schedule of any part-pay agreement into which it has entered for payment of premiums or assessment obligations;

(c) Not have cumulative lapses in workers' compensation coverage in excess of forty days within the prior twelve months.

(d) Have reported actual payroll and pays any premium due upon reconciliation between estimated premium and actual premium due for the preceding policy year.

(3) An employer shall be immediately disqualified from participation in the grow Ohio incentive program if the employer fails to report actual payroll for a policy year or fails to pay any premium due upon reconciliation between estimated premium and actual premium due for that policy year by the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with such report before the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code.

(4) An employer shall be immediately disqualified from participation in the grow Ohio incentive program if the employer is found by the bureau to have knowingly misrepresented information on the initial application for coverage.

(a) As used in this paragraph, "knowingly" means that the employer had actual knowledge of the misrepresentation and was aware that the misrepresentation would cause a certain result. An employer will not be deemed to have knowingly misrepresented information on the initial application for coverage where the employer's determination of how to report was based on:

(i) The employer's reasonable interpretation of a law, rule, or manual classification;

(ii) Written advice received from the bureau.

(b) An employer immediately disqualified from participation in the grow Ohio incentive program under this paragraph shall make restitution of all discounts received from participating in the program.

(5) An employer shall be immediately disqualified from participation in the grow Ohio incentive program if the bureau determines the employer has failed to comply with rule 4123-17-14.1 of the Administrative Code.

An employer immediately disqualified from participation in the grow Ohio incentive program under this paragraph shall make restitution of all discounts received from participating in the program in every policy year in which the bureau determines the employer failed to comply with rule 4123-17-14.1 of the Administrative Code.

(6) An employer shall be immediately disqualified from participation in the grow Ohio incentive program if the employer is removed from a group for a gross misrepresentation on its application for the group experience rating program under paragraph (F) of rule 4123-17-62 of the Administrative Code.

Last updated February 28, 2022 at 3:46 PM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29
Five Year Review Date:
Rule 4123-17-71 | One claim program.
 

(A) Definitions.

As used in this rule:

(1) "One claim program" or "OCP" means the bureau's voluntary rate program which offers a private employer or a public employer taxing district employer the opportunity to mitigate the impact of a significant claim that will enter the employer's experience for the first time.

(2) "Program eligibility period" means the four policy years in which an employer has a significant claim in its experience period.

(3) "Significant claim" means a claim whose total value or maximum claim value, whichever is lower, will be greater than the employer's total limited losses ("TLL") as defined in rule 4123-17-03 of the Administrative Code. Effective July 1, 2020, for private employers whose expected losses fall below the minimum expected loss provided in appendix A to rule 4123-17-05.1 of the Administrative Code, a TLL of three hundred dollars shall be used; for public employer taxing districts whose expected losses fall below the minimum expected loss provided in appendix A to rule 4123-17-33.1 of the Administrative Code, a TLL of five hundred fifty dollars shall be used.

(4) "Minor claim" means a medical-only or lost-time claim whose total value or maximum claim value, whichever is lower, will be less than the employers TLL as defined in rule 4123-17-03 of the Administrative Code, subject to the TLL provisions of a significant claim that became effective July 1, 2020.

(B) Application and withdrawal processes.

An employer's participation in the OCP is voluntary. The employer shall apply to participate in the OCP for each year of the program eligibility period. The bureau shall have the final authority to approve an eligible employer for initial and continued participation in the OCP.

(1) An employer may withdraw from the OCP under this rule at any time. An employer that withdraws from the OCP after receiving a discount will return to its own individual experience rating for that policy year.

(2) If the employer withdraws from the OCP and has any remaining years in the program eligibility period, the employer may reapply for the OCP and designate the same significant claim as its one claim.

(C) Eligibility requirements.

At the time of an employer's initial application for the OCP, the employer must be enrolled in the group experience rating program. At the time of initial application and each renewal application, the employer must:

(1) Be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code;

(2) Be current on the payment schedule of any part-pay agreement into which it has entered for payment of premiums or assessment obligations;

(3) Not have cumulative lapses in workers' compensation coverage in excess of forty days within the prior twelve months;

(4) Be enrolled in the group experience rating program; and

(5) Report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the application deadline date set forth in rule 4123-17-74 of the Administrative Code.

(D) General program requirements.

(1) In signing the application form, the chief executive officer or designated management representative of the employer is certifying to the bureau that the employer will comply with all program requirements.

(2) An employer may have a maximum of three minor claims at any time in addition to the one significant claim.

(a) As a minor claim exits the employer's experience period, the employer may include a new minor claim.

(b) The total combined costs of these minor claims must be below the employer's TLL.

(3) An employer may participate in the OCP on no more than one significant claim within the program eligibility period from the date of the employer's initial participation in the program.

(4) Once a claim has been designated as the significant claim in initial enrollment for a program eligibility period, an employer is not permitted to change the claim designated as the significant claim.

(5) Settled and subrogated claims will be included in the employer's total claim count.

(6) In the first year of the program eligibility period, the employer shall participate in an industry-specific half-day safety program prescribed by the division of safety and hygiene. In subsequent years of the program eligibility period in which the employer elects to participate in the OCP, the employer shall complete an online training class prescribed by the division of safety and hygiene.

(7) Once admitted into the OCP, the employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays any premium owed associated with that payroll report before the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code.

(E) Program benefits.

(1) The bureau will credit an employer that meets all the criteria with a discount from the employer's base rate as follows:

(a) In the first year of the program eligibility period, twenty per cent;

(b) In the second year of the program eligibility period, fifteen per cent;

(c) In the third year of the program eligibility period, ten per cent; and

(d) In the fourth year of the program eligibility period, five per cent.

(2) If an employer participating in OCP would have a lower experience modifier (EM) under the EM cap set forth in rule 4123-17-03.2 of the Administrative Code, the bureau shall apply the EM cap instead of the OCP discount.

(F) Removal from program.

(1) If the employer fails to meet the requirements of paragraph (C) or paragraph (D) of this rule, the bureau will remove an employer from participation in the OCP at the beginning of the next policy year and, upon removal, will return the employer to its individual EM.

(2) An employer removed from the OCP for failure to comply with paragraph (D)(7) of this rule will be rerated for the full policy year at the employer's base rate or experience-modified rate as determined by the employer's expected losses for the policy year.

(G) An employer may appeal the bureau's application rejection or the bureau's participation removal in the OCP to the bureau's adjudicating committee pursuant to section 4123.291 of the Revised Code and rule 4123-14-06 of the Administrative Code.

Last updated September 13, 2021 at 5:52 PM

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date:
Prior Effective Dates: 1/1/2005, 2/12/2009, 1/1/2010, 11/15/2010
Rule 4123-17-72 | Deductible rule.
 

(A) Definitions.

As used in this rule:

(1) "Coverage period" means the twelve month period beginning July first through June thirtieth for private employers, and January first through December thirty-first for public employers. The deductible selected by the employer will apply only to claims with a date of injury within the coverage period defined in the deductible agreement.

(2) "Deductible" means the maximum amount an employer participating in the deductible program must reimburse the bureau for each claim that occurs during the policy year.

(a) "Small deductible" means a deductible less than or equal to ten thousand dollars.

(b) "Large deductible" means a deductible greater than ten thousand dollars.

(3) "Experience rated premium" means the premium obligations of an employer for the policy year excluding disabled workers' relief fund ("DWRF") and administrative cost assessments. Experience rated premium may include any experience rated premium related to policy combinations. The premium is subject to the premium sized adjustment described in rule 4123-17-03.3 of the Administrative Code.

(4) "Modified rate" means the rate that employers who are experience rated pay as a percentage of their payroll. This rate is calculated by taking the base rate and multiplying it by the employer's experience modification ("EM") factor.

(5) "Base rate" means the rate that employers who are not experience rated pay as a percentage of their payroll.

(6) "Policy in good standing" means the employer is current on all payments due to the bureau and is in compliance with bureau laws, rules, and regulations at the time of enrollment or reenrollment.

(7) "Premium" means money paid and due from an employer for workers' compensation insurance. Premium does not include money paid as fees, fines, penalties or deposits.

(8) "Qualified employer" means an employer that has a state insurance fund policy that is in good standing at the time of enrollment or reenrollment. Although the employer may be a qualified employer, the bureau may not accept the employer into the deductible program for other reasons set forth in this rule.

(B) Eligibility requirements.

(1) An employer shall be eligible to participate in the deductible program only if the employer meets all of the following requirements:

(a) As of each continuing eligibility evaluation date, the employer holds active workers compensation coverage as of the original application deadline or anniversary date of participation as follows:

(i) The employer must be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code.

(ii) The employer must be current on the payment schedule of any part-pay agreement into which it has entered for payment of premiums or assessment obligations.

(iii) If the employer selects a small deductible, the employer may not have cumulative lapses in workers' compensation coverage in excess of forty days within the preceding twelve months.

(iv) If the employer selects large deductible, the employer may not have cumulative lapses in workers' compensation coverage in excess of fifteen days within the preceding five years.

(v) The employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the application deadline date set forth in rule 4123-17-74 of the Administrative Code.

(b) The employer shall demonstrate the ability to make payments under the deductible program based upon a credit score established by the bureau on an annual basis which will be applicable to all applicants for the program year. The bureau shall obtain the credit reports from an established vendor of such information. An employer that is a subsidiary of another corporate entity may use the parent corporate entity's credit score in meeting this requirement if the parent corporate entity meets financial criteria for the deductible program and executes a contract of guaranty with respect to the subsidiarys participation in the program.

(c) The bureau may require an employer to adopt additional risk mitigation measures as a prerequisite for participation in the program. These measures may include, but are not limited to, either individually or in combination, the following:

(i) Adoption of an alternative payment plan;

(ii) Providing securitization in the form of a letter of credit or surety bond; or

(iii) For employers electing a large deductible, selection of an aggregate stop-loss limit.

(2) The following employers shall not be eligible to participate in the deductible program:

(a) State agencies; and

(b) Self-insuring employers providing compensation and benefits pursuant to section 4123.35 of the Revised Code.

(C) In selecting an employer deductible program under this rule, the employer must select, on an application provided by the bureau, a per claim deductible amount, which shall be applicable for all claims with dates of injury within a one-year coverage period. The employer shall choose one deductible level from the following:

(1) Five hundred dollars;

(2) One thousand dollars;

(3) Two thousand five hundred dollars;

(4) Five thousand dollars;

(5) Ten thousand dollars;

(6) Twenty-five thousand dollars;

(7) Fifty thousand dollars;

(8) One hundred thousand dollars; or

(9) Two hundred thousand dollars.

(D) In choosing a small deductible, the employer may not choose a deductible amount that exceeds twenty-five per cent of their experience rated premium obligation during the most recent full policy year. For a new employer policy, the deductible amount shall not exceed twenty-five per cent of the employer's expected premium. In choosing a large deductible, the employer may not choose a deductible amount that exceeds forty per cent of their experience rated premium obligation for the most recent full policy year. For self-insuring employers re-entering the state insurance fund, the bureau will use the paid workers' compensation benefits from the last full policy year in place of experience rated premium. The bureau may estimate a full year's premium should only a partial year be available or if no premium is available in the most recent full policy year.

(E) An employer selecting a large deductible will undergo additional credit analysis and must submit financial information to the bureau during the enrollment period preceding each policy year they elect to participate in the program.

(1) An employer choosing a deductible level of twenty-five thousand dollars or fifty thousand dollars must submit reviewed or audited financials for at least the three most recent fiscal years. The financials must be prepared in accordance with generally accepted accounting principles (GAAP).

(2) An employer choosing a deductible level of one hundred thousand dollars or two hundred thousand dollars must submit audited financials for at least the three most recent fiscal years. The financials must be prepared in accordance with GAAP.

(F) An employer may request an annual aggregate stop-loss limit option in combination with large deductible levels. If the employer requests the aggregate stop-loss limit option, the bureau shall limit the employer's deductible billings for injuries which occur during the associated policy year to three times the deductible level chosen. The bureau may reject the employer's request to participate in the aggregate stop-loss limit option if the bureau determines that, because of the employer's premium or estimated premium size, the employer would receive a credit under this rule that would exceed the employer's maximum aggregate stop-loss liability.

(G) The employer shall file the application provided by the bureau and any other documentation required for enrollment in the deductible program by the applicable application deadline set forth in appendix A or appendix B to rule 4123-17-74 of the Administrative Code.

The bureau shall not permit an employer to enroll in a deductible program outside of the application deadline, except that the bureau will consider an employer establishing a policy in Ohio for the first time for participation where the employer submits its deductible program application to the bureau within thirty days of obtaining coverage.

(H) Renewal in the deductible program at the same level for each subsequent year shall be automatic, subject to review by the bureau of the employer's continued eligibility under paragraph (B) of this rule, unless the employer notifies the bureau in writing that the employer does not wish to participate in the program or that the employer wants to change the deductible amount for the next coverage period. The employer shall provide such notice to the bureau within the time and in the manner provided in paragraph (G) of this rule.

(I) Except as provided in paragraph (M) of this rule, an employer shall not be permitted to withdraw from the deductible program during the policy year, and no changes shall be made with respect to any deductible amount selected by the employer within the policy year.

(J) The bureau shall pay the claims costs under a deductible program and the employer shall reimburse to the bureau the costs under the deductible program as follows:

(1) The bureau shall pay all claims costs in accordance with the laws and rules governing payment of workers' compensation benefits. For small deductible levels, the amount to be included in the employer's experience for a policy year shall be any claims costs for injuries incurred in that policy year less any deductible billed to the employer under this rule. For large deductible levels, the bureau shall include the entire claims cost for injuries incurred in a policy year in the employer's experience for that policy year. Any qualifying claims in accordance with paragraphs (G)(4) and (G)(5) of rule 4123-17-03 of the Admistrative Code shall be excluded from the employer's experience.

(2) The bureau shall bill the employer on a monthly basis for any claims costs paid by the bureau for amounts subject to the deductible as elected by the employer for the policy year. In addition to amounts paid by the bureau for which the bureau is seeking reimbursement from the employer, such monthly billings shall also reflect the payments to date for any claims to which a deductible is applicable.

(3) The employer shall pay all deductible amounts billed by the bureau by the invoice due date. The employer will be subject to any interest or penalty provisions to which other monies owed the bureau are subject, including certification to the attorney general's office for collection.

(4) The employer shall continue to be liable beyond any deductible program period for billings covered under a deductible program for injuries that arose during any period for which a deductible is applicable, regardless of when payment was made by the bureau.

(K) The bureau will apply the premium reduction calculation under the deductible program directly to the base rate established for the policy year for base-rated employers, or after the modified premium rate is established for experience-rated employers, but prior to any other premium adjustments, as well as DWRF and administrative expenses. The bureau will calculate the premium reduction in accordance with the appendices of this rule, which takes into account both the deductible amount chosen by the employer and the applicable hazard group based upon the most current version of the national council on compensation insurance's hazard groupings as established by the hazard group with the largest percentage of premium, as determined at the end of the enrollment period for that year.

(1) In determining the primary classification code and appropriate hazard group, the bureau shall utilize payroll and the associated experience premium for the rating year beginning two years prior to the period in which the employer is seeking to enroll in the deductible program.

(2) For new employers, the bureau shall base the appropriate primary classification code and hazard group upon estimated payroll.

(L) Where there is a combination or experience transfer of an employer within a deductible program policy period, following the application of any other rules applicable to a combination or experience transfer, the employer may be eligible to remain in a deductible program as follows:

(1) Successor: entity not having coverage.

Predecessor: enrolled in deductible program currently or in prior policy years.

Where there is a combination or experience transfer, where the predecessor was a participant in the deductible program and the successor is assigned a new policy with the bureau, the successor shall make application for the deductible program within thirty days of obtaining a bureau policy, as set forth in paragraph (L)(3) of this rule. Notwithstanding this election, the successor shall be responsible for any and all existing or future liabilities stemming from the predecessor's participation in the deductible program prior to the date that the bureau was notified of the transfer as provided under paragraph (C) of rule 4123-17-02 of the Administrative Code.

(2) Successor: enrolled in the deductible program.

Predecessor: not enrolled in the deductible program.

Where there is a combination or experience transfer involving two or more entities, each having Ohio coverage at the time of the combination or experience transfer, and the successor policy is enrolled in the deductible program for the program year, the successor shall automatically remain in the deductible program for the program year and is subject to renewal in accordance with paragraph (H) of this rule.

(3) Successor: not enrolled in deductible program.

Predecessor: enrolled in deductible program.

Where there is a combination or experience transfer involving two or more entities, each having Ohio coverage at the time of the combination or experience transfer, and the successor policy is not enrolled in the deductible program, the predecessor shall not be automatically entitled to continue in the deductible program. The successor may make a formal application should it desire to participate in the deductible program for the next policy year. Whether or not the successor chooses or is otherwise eligible to participate in a deductible program, under paragraph (C) of rule 4123-17-02 of the Administrative Code, the successor remains liable for any existing and future liabilities resulting from a predecessor's participation in the deductible program.

(M) The bureau may remove an employer participating in the deductible program from the program with thirty days written notice to the employer for any of the following reasons:

(1) The employer participates in any plan or program that is not compatible with the deductible program under rule 4123-17-74 of the Administrative Code

(2) The bureau certifies a balance due from the employer to the attorney general;

(3) The employer makes direct payments to any medical provider for services rendered, to any medical provider for supplies or to any injured worker for compensation associated with a workers' compensation claim;

(4) The employer engages in misrepresentation or fraud in conjunction with the deductible program application process; or

(5) The employer fails to report actual payroll for the preceding policy year or fails to pay any premium due upon reconciliation of estimated premium and actual premium for that policy year, no later than the due date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have complied with this requirement if the bureau receives the payroll report, and the employer pays any premium associated with the payroll report, prior to the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code.

(N) An employer removed from the deductible program for failure to comply with paragraph (M) of this rule will be required to pay:

(1) Claims costs up to the deductible selected under paragraph (C) of this rule for all injuries incurred from the beginning of policy year in which the employer participated in the deductible program through the date of removal from the program; and

(2) Full experience-rated premium, without the deductible credit, from the date of removal from the deductible program through the remainder of the policy year.

View AppendixView AppendixView AppendixView AppendixView Appendix

Last updated January 3, 2023 at 9:49 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13, 4121.30
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 7/1/2009, 3/11/2010, 11/15/2010, 7/1/2012, 1/1/2013, 9/4/2014, 7/1/2017, 3/26/2018, 7/1/2019, 10/5/2019, 11/1/2021, 7/1/2022
Rule 4123-17-73 | Group retrospective rating program.
 

(A) Definitions.

As used in this rule:

(1) "Group retrospective rating" is a voluntary workers' compensation insurance program offered by the bureau. Group retrospective rating is designed to provide financial incentive to employer groups participating in the program that, through improvements in workplace safety and injured worker outcomes, are able to keep their claim costs below a predefined level.

(2) "Basic premium factor" is a component of the retrospective rating premium formula used to account for insurance charges and costs that are distributed across all employers. The basic premium factor (BPF) is based upon charges for the cost of having retrospective premium limited by the selected maximum premium ratio, the cost of claims when they exceed the per claim maximum value and the cost of excluding surplus costs from incurred losses.

(3) "Developed 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 claim cost development 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 be covered by premium collected.

(4) "Evaluation period" means 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, twenty-four, and thirty-six months after the end of the retro policy year.

(5) "Incurred losses" means compensation payments and medical payments paid to date as well as open case reserves. The total incurred losses will not include surplus costs or costs as defined in paragraphs (G)(4) or (G)(5) of rule 4123-17-03 of the Administrative Code and will be limited on a per claim basis.

(6) "Loss development factor" means actuarially determined factors that are multiplied by incurred losses of non-PTD/death retro claims to produce developed losses. Loss development factors (LDF) are unique to each retro policy year.

(7) "Maximum premium ratio" means a factor pre-selected by the retro group that is multiplied by the standard premium after application of the premium size factors to determine the maximum retrospective premium for the group.

(8) "Member of a retro group" means the individual employers that participate in a group retrospective rating plan of a sponsoring organization.

(9) "Reserve" means the bureau's estimate of the future cost of a claim at a specific point in time.

(10) "Retro policy year" means the policy year in which an employer is enrolled in group retrospective rating. Claim losses which occur during this year will be tracked for all retro group members and refunds or assessments will be distributed based on those losses in the subsequent evaluation period. The retro policy year start and end date will match that of the rating policy year. For public employer taxing districts, the retro policy year shall be January first through December thirty-first of a year. For private employers, the retro policy year shall be July first through June thirtieth of the following year.

(11) "Standard premium" means the total premium paid by or on behalf of an employer for a given policy year including any premium size factor adjustment, excluding the assessments for the disabled workers' relief fund and the administrative cost fund. In determining standard premium, total premium paid will not be reduced by any rebates or dividends issued pursuant to rule 4123-17-10 of the Administrative Code.

(12) "Application deadline" means the application deadline for group retrospective rating as set forth in appendix A and in appendix B to rule 4123-17-74 of the Administrative Code.

(B) Sponsor eligibility requirements.

Each sponsoring organization seeking to sponsor a retro group must be certified under the bureau's sponsor certification process as specified in rule 4123-17-61.1 of the Administrative Code.

(C) Retro group eligibility requirements.

Each retro group seeking to participate in the bureau group retrospective rating program shall meet the following standards:

(1) A retro group must be sponsored by a bureau certified sponsoring organization.

(2) The employers' business in the organization must be substantially similar such that the risks which are grouped are substantially homogeneous. A group shall be considered substantially homogeneous if the main operating classification codes of the risks as determined by the premium obligations for the rating year beginning two years prior to the retro policy year are assigned to the same or similar industry groups. Industry groups are determined by appendix A to rule 4123-17-05 of the Administrative Code. Industry groups seven and nine as well as eight and nine, and industry groups two and four as well as four and six are are considered similar. The bureau may allow an employer to move to a more homogeneous group when, after December thirty-first for private employer groups and June thirtieth for pubic employer taxing district groups, but before the application deadline, the employer:

(a) Is an employer without a full year of recorded premium;

(b) Is reclassified as a result of an audit; or

(c) Fully or partially combines with another employer.

(3) A retro group of employers must have aggregate standard premium in excess of one million dollars, as determined by the administrator based upon the last full policy year for which premium information is available.

(a) For employers without a full year of recorded premium, the bureau may use the employer's expected premium.

(b) The bureau shall calculate the premium based upon the experience modified premium of the individual employers excluding group rating discounts.

(4) The retro group must include at least two employers.

(5) The formation and operation of the retro group program by the organization must substantially improve accident prevention and claims handling for the employers in the retro group. The bureau shall require the retro group to document its safety plan or program for these purposes, and, for retro groups reapplying annually for group retrospective rating coverage, the results of prior programs. The safety plan must follow the guidelines and criteria set forth under rule 4123-17-68 of the Administrative Code.

(D) Employer eligibility requirements.

Each employer seeking to participate in the bureau group retrospective rating program must meet the following standards:

(1) The employer must be a private employer or public employer taxing district that participates in the state insurance fund. A self-insuring employer or a state agency public employer shall not be eligible for participation in the group retrospective rating program.

(2) Each employer seeking to enroll in a retro group for workers' compensation coverage must have active workers' compensation coverage according to the following standards:

(a) As of the application deadline, the employer must be current with respect to all payments due the bureau, as defined in paragraph (A)(1)(b) of rule 4123-17-14 of the Administrative Code.

(b) As of the application deadline for group retrospective rating, the employer must be current on the payment schedule of any part-pay agreement into which it has entered for payment of premiums or assessment obligations.

(c) The employer cannot have cumulative lapses in workers' compensation coverage in excess of forty days within the twelve months preceding the application deadline date for group retrospective rating.

(d) The employer must report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the application deadline date set forth in rule 4123-17-74 of the Administrative Code.

(3) No employer may be a member of more than one retro group or a retro and non-retro group for the purpose of obtaining workers' compensation coverage. An employer who has been included on a group experience rating roster for the upcoming policy year may not elect to participate in group retrospective rating after the deadline for group experience rating set forth in rule 4123-17-74 of the Administrative Code.

(4) An employer must be homogeneous with the industry group of the retro group as defined in paragraph (C)(2) of this rule.

A member of a continuing retro group who initially satisfied the homogeneous requirement shall not be disqualified from participation in the continuing retro group for failure to continue to satisfy such requirement.

(E) A sponsoring organization shall make application for group retrospective rating on a form provided by the bureau and shall complete the application in its entirety with all documentation attached as required by the bureau. If the sponsoring organization fails to include all pertinent information, the bureau will reject the application.

(1) The group retrospective rating application (U-151) shall be signed each year by an officer of the sponsoring organization.

(2) The sponsoring organization shall identify each individual employer in the retro group on an employer roster for group retrospective rating plan (U-152).

(F) A retro group's application for group retrospective rating is applicable to only one policy year. The retro group must reapply each year for group retrospective rating coverage. Continuation of a plan for subsequent years is subject to timely filing of an application on a yearly basis and the meeting of eligibility requirements each year.

(G) Upon receipt of an application for retro group, the bureau shall do the following:

(1) Determine the industry classification of the retro group based upon the makeup of retro group employers submitted.

(2) Screen prospective retro group members to ensure that their business operations fit appropriately in the retro group's industry classification.

(3) In reviewing the retro group's application, if the bureau determines that individual employers in the retro group do not meet the eligibility requirements for group retrospective rating, the bureau will notify the individual employers and the retro group of this fact, and the retro group may continue in its application for group retrospective rating coverage without the disqualified employers.

(H) The group retrospective rating sponsor shall submit to the bureau an employer statement (U-153) each year for each employer that wishes to participate in group retrospective rating with the sponsor. Where an employer files a new employer statement form in the sixty days prior to the application deadline, the bureau will presume that the latest filed employer statement form of the employer indicates the employer's intentions for group retrospective rating. An employer statement form shall remain effective until the end of the policy year as defined on the employer statement form.

(I) The bureau may request of individual employers or the retro group sponsor, additional information necessary for the bureau to rule upon the application for group retrospective rating participation. Failure or refusal of the retro group sponsor to provide the requested information on the forms or computer formats provided by the bureau shall be sufficient grounds for the bureau to reject the application and refuse the retro group's participation in group retrospective rating program.

(J) Individual employers who are not included on the final retro group roster or do not have an individual employer application (U-153) for the same retro group or another retro group sponsored by the same sponsoring organization on file by the application deadline, will not be considered for the group retrospective rating plan for that policy year; however, the bureau 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. The group retrospective rating sponsor shall submit all information to the bureau by the application deadline.

(K) Once a retro group has applied for group retrospective rating, the organization may not voluntarily terminate the application. All changes to the original application must be filed on a bureau form provided for the application for the group retrospective rating plan and must be filed prior to the filing deadline. Any rescissions made must be completed in writing, signed by an officer of the sponsoring organization and filed prior to the filing deadline. The retro group may make no changes to the application after the last day for filing the application. Any changes received by the bureau after the filing deadline will not be honored. The latest application form or rescission received by the bureau prior to the filing deadline will be used in determining the premium obligation.

(L) After the group retrospective rating application deadline but before the end of the policy year for the retro group, the sponsoring organization may notify the bureau that it wishes to remove a member of a retro group from participation in the retro group. The sponsoring organization may request that the member of a retro group be removed from the retro group after the application deadline only for the gross misrepresentation of the member of a retro group on its application to the retro group.

(1) "Gross misrepresentation" is an act by an employer applicant for group retrospective rating or a member of a retro group that would cause financial harm to the other members of the retro group and is limited to any of the following:

(a) The sponsoring organization discovers that the employer applicant for group retrospective rating or a member of a retro group 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.

(b) The sponsoring organization discovers that the employer applicant for group retrospective rating or a member of a retro group has failed to disclose the true nature of the employer's business pursuit on its application for membership in the retro group, and this failure adversely affects the loss potential of the retro group.

(2) The sponsoring organization must provide sufficient documentation, as determined by the bureau, to support its request to remove an employer from a retro group.

(3) The employer shall be removed from the group only with the bureau's approval.

(M) An employer will be removed from the group retrospective rating program for the current policy year for failure to report actual payroll for the preceding policy year and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year no later than the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with that payroll report before the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code. Should an employer not comply with the provisions of this paragraph, the following will apply:

(1) Claims costs according to this rule for all injuries incurred from the beginning of the policy year in which the employer participated in group retrospective rating through the date of removal from the program shall be included in the group retrospective rating calculation; and

(2) Only premium from the beginning of the policy year through the date of removal will be included in the group retrospective rating calculation for the participation policy year.

(N) A retro group formed for the purpose of group retrospective rating may not voluntarily terminate a plan during the policy year. A change in the name of the retro group will not constitute a new retro group. A change of the organization sponsoring a retro group or moving a retro group to a new sponsoring organization shall constitute a new retro group and the members of the new retro group must meet the homogeneity requirement of paragraph (C)(2) of this rule. A retro group shall be considered a continuing retro group if more than fifty per cent of the members of the retro group in the previous rating year are members of the retro group in the current rating year.

(O) Selection of an authorized representative for the retro group shall meet the following requirements:

(1) A retro group that has been established and has been accepted by the bureau for the purpose of group retrospective rating shall have no more than one permanent authorized representative for representation of the retro group and the individual employers of the retro group before the bureau and the industrial commission in any and all policy-related matters pertaining to participation in the state insurance fund.

(2) The selection of an authorized representative must be made by submission of a completed form U-151, and any change or termination of the authorized representative can be made only by a subsequent submission of form U-151. Only an officer of the sponsoring organization may sign a U-151.

(P) The bureau shall consider an employer individually when assessing the premium payments for the retro policy year. The retro group will be considered a single entity for purposes of calculating group retrospective rating premium adjustments.

(Q) The group retrospective rating premium calculation will occur at twelve, twenty-four, and thirty-six months following the end of the group retrospective rating policy year.

(1) On the evaluation date, the bureau will evaluate all claims with injury dates that fall within the retro policy year. The incurred losses and reserves that have been established for these claims are "captured" or "frozen." The group's retrospective premium will be calculated based on the developed incurred losses of the group. The group retrospective rating premium will be compared to the group standard premium, which is the combined standard premiums of retro group members for the retro policy year as defined in paragraph (A)(11) of this rule and all subsequent group retrospective rating refunds and assessments. The difference will be distributed or billed to employers as a refund or assessment.

(a) These assessments will be limited per a maximum premium ratio selected during the group retrospective rating application process.

(b) Effective with policy years beginning on or after January 1, 2022, premium refunds or premium rebates provided to group retrospective rating employers for a policy year may not exceed, in their cumulative total, one hundred percent of the actual premium following reporting of actual payroll and reconciliation of estimated premium and actual premium in accordance with paragraph (M) of this rule.

(c) Any reserving method that suppresses some portion of an employer's costs for the purpose of calculating an experience modification will not apply in the calculation of incurred losses for group retrospective rating.

(d) The bureau 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. Any net refund or assessment will be fully distributed or billed by the bureau in the third evaluation period.

(2) Incurred losses used in the group retrospective rating premium calculation will be limited to five hundred thousand dollars per claim.

(3) Incurred losses will not include surplus or violation of a specific safety requirement (VSSR) costs.

(R) The retrospective premium calculation that will occur at various evaluation points after the retro policy year end is calculated by the following formula, with standard premium and developed incurred losses are for the total of the entire retro group :

Group retrospective rating premium =

(Basic premium factor x standard premium as defined in paragraph (A)(11) of this rule)

plus

developed incurred losses

(1) A group will elect a maximum premium ratio for the group each year as part of the group retrospective rating application process. This ratio will determine the maximum amount of total premium a retro group may pay after refunds and assessments.

(2) Options for the maximum premium ratio and the corresponding basic premium factor will be as set forth in appendix A and in appendix B to this rule.

(3) A basic premium factor is applied in the retro premium calculation to account for insurance costs, surplus costs, and a per claim cap. The basic premium factor is determined using the following factors: group size by standard premium as defined in paragraph (A)(11) of this rule as set forth in appendix D to this rule and maximum premium ratio.

(4) Developed incurred losses are created by totaling incurred losses and reserves for the entire retro group and applying an actuarially determined loss development factor as defined in appendix C to this rule.

(5) Refunds and assessments will be distributed directly to group retrospective rating employers. The amount refunded or assessed to an individual employer will be based upon the percentage of the total group standard premium paid by the employer at the time of evaluation. The refund or assessment will be multiplied by this percentage and the resulting amount will be distributed or billed to the employer.

(6) Within four months of the evaluation date, if entitled, the bureau will send premium refunds.

(7) If additional premium is owed, the additional premium is included in the employer's next invoice and must be paid by the due date stated on the invoice. The bureau will charge penalties on any additional premium not paid when it is due. If the member of a retro group is entitled to a refund for one retro policy year and owes any additional monies to the bureau, the bureau will deduct the monies due the bureau from the refund. The bureau will refund the difference to the member of a retro group. In the event that this adjustment still leaves a premium balance due, the bureau will send a bill for the balance.

(S) Terminations, transfers, and change of ownership are addressed with regard to group retrospective rating as follows:

(1) Predecessor: enrolled in group retrospective rating program.

Successor: new entity.

Where there is a combination or experience transfer during the current policy year or the sixty days preceding the application deadline for the upcoming policy year, wherein the predecessor was a participant in or applicant for the group retrospective rating program, and the successor is assigned a new policy with the bureau, the successor may be considered a member of the group retrospective rating program if agreed to by both the succeeding employer and the group retrospective rating sponsor. Written agreement signed by both the succeeding employer and the group retrospective rating sponsor must be received by the bureau within thirty days of the date of succession. If the succeeding employer and the group sponsor agree to successor joining the retro group, the successor's group retrospective rating evaluation shall be based on the group's reported payroll and claims incurred. Notwithstanding this election, the successor shall be responsible for any and all existing or future rights and obligations stemming from the predecessor's participation in the group retrospective rating program prior to the date that the bureau was notified of the transfer as prescribed under paragraph (C) of rule 4123-17-02 of the Administrative Code.

(2) Predecessor: not enrolled in group retrospective rating program.

Successor: enrolled in group retrospective program.

Where one legal entity that has established coverage and is enrolled in the group retrospective rating program, wholly succeeds one or more legal entities having established coverage and the predecessor entities are not enrolled in the group retrospective rating program at the date of succession, the payroll reported and claims incurred by the predecessor from the date of succession to the end of the policy year, shall be included in successor's retrospective rating plan. If the predecessor had at any time participated in a group retrospective rating program, the successor shall be responsible for any and all existing or future rights and obligations stemming from the predecessor's participation in the group restrospective rating program prior to the date that the bureau was notified of the transfer as prescribed under paragraph (C) of rule 4123-17-02 of the Administrative Code.

(3) Predecessor: enrolled in group retrospective rating program.

Successor: not enrolled in group retrospective rating program.

Where one legal entity that has established coverage and is not currently enrolled in a group retro plan wholly succeeds one or more entities that are enrolled in a group retro plan, predecessor's plan(s) shall terminate as of the ending date of the evaluation period. Payroll reported and claims incurred on or after the date of succession will be the responsibility of the successor under its current rating plan. The successor shall be responsible for any and all existing or future rights and obligations stemming from the predecessor's participation in the group retro program prior to the date that the bureau was notified of the transfer as prescribed under paragraph (C) of rule 4123-17-02 of the Administrative Code.

(4) Predecessor: enrolled in group retro program.

Successor: enrolled in different group retro program.

Where one legal entity that has established coverage and is enrolled in a group retrospective rating plan wholly succeeds one or more entities that are enrolled in a group retrospective rating plan, predecessor's plan(s) shall terminate as of the ending date of the evaluation period. Payroll reported and claims incurred on or after the date of succession will be the responsibility of the successor under its group retrospective rating plan. The successor shall be responsible for any and all existing or future rights and obligations stemming from the predecessor's participation in the group retrospective rating program prior to the date that the bureau was notified of the transfer as prescribed under paragraph (C) of rule 4123-17-02 of the Administrative Code.

(5) Predecessor: enrolled in group retrospective rating program.

Successor: enrolled in same group retrospective rating program.

Where one legal entity that has established coverage and is enrolled in a group retrospective rating plan wholly succeeds one or more entities that are enrolled in the same group retrospective rating plan, the successor shall be responsible for any and all existing or future liabilities stemming from the predecessor's participation in the group retrospective rating program prior to the date that the bureau was notified of the transfer as prescribed under paragraph (C) of rule 4123-17-02 of the Administrative Code. If the predecessor had at any time participated in a different group retrospective rating program, the successor shall be responsible for any and all existing or future rights and obligations stemming from the predecessor's participation in the group retrospective rating program prior to the date that the bureau was notified of the transfer as prescribed under paragraph (C) of rule 4123-17-02 of the Administrative Code.

(6) Successor: cancels coverage and was enrolled in group retrospective rating program.

Predecessor: no predecessor.

If the successor cancels coverage and there is no predecessor, the premium and losses of the canceling employer will remain with the retro group for future retrospective premium calculations. The resulting refund or assessment will be collected from the remaining members of the retro group.

Group retrospective rating sponsors and authorized representatives have the right to represent the interest of the canceled employer on behalf of the group with regard to claims which occurred during the year or years the employer was active in a retro group sponsored by the organization.

(7) Successor and/or predecessor: open group retrospective rating policy years in the evaluation period.

If the successor and predecessor are not currently enrolled in the group retrospective rating program, but either or both have open group retrospective rating policy years in the evaluation period, the successor shall be responsible for any and all existing or future rights and obligations stemming from the predecessor's participation in the group retrospective rating program prior to the date that the bureau was notified of the transfer as prescribed under paragraph (C) of rule 4123-17-02 of the Administrative Code.

(8) Partial transfer.

If an entity partially succeeds another entity and the predecessor entity has any group retrospective rating policy years in the evaluation period, the predecessor entity will retain any rights to assessments or refunds. If the successor is enrolled in the group retrospective rating program, payroll reported and claims incurred on or after the date of the partial transfer will be the responsibility of the successor under its group retrospective rating plan.

(9) Successor: files a petition for bankruptcy.

Predecessor: no predecessor.

If a current or previously group retrospective rating program employer with open retro policy years files a petition for bankruptcy under chapter seven or chapter eleven of the federal bankruptcy law, that employer shall notify the bureau legal division by certified mail within five working days from the date of the bankruptcy filing. The bureau will petition the bankruptcy court to take appropriate action to protect the state insurance fund and other related funds.

View AppendixView AppendixView Appendix

Last updated July 27, 2023 at 8:46 AM

Supplemental Information

Authorized By: 4121.12, 4121.121, 4121.13
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 7/1/2009, 3/22/2010, 11/18/2010, 7/1/2012, 7/1/2015, 7/10/2016, 1/1/2017
Rule 4123-17-74 | Deadline dates and compatibility information for employer programs.
 

This rule defines employer program deadlines, miscellaneous dates, and compatibility between programs. Specifics may be found in the following appendices:

Appendix A: Private employer program deadlines and miscellaneous dates.

Appendix B: Public employer taxing district program deadlines and miscellaneous dates.

Appendix C: Employer program compatibility.

This rule supersedes other rules referencing program deadlines and compatibility.

View AppendixView Appendix

Last updated July 27, 2023 at 8:47 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.12, 4123.34
Five Year Review Date:
Prior Effective Dates: 11/15/2010, 7/1/2011, 11/1/2011, 7/1/2012, 3/9/2015, 3/21/2015, 7/1/2015
Rule 4123-17-75 | Bonus and rebate incentive programs.
 

(A) The following bonus and rebate incentives are offered:

(1) The lapse-free rebate established in rule 4123-17-14.4 of the Administrative Code;

(2) The transitional work bonus established in rule 4123-17-55 of the Administrative Code;

(3) The safety council rebate established in rule 4123-17-56.2 of the Administrative Code; and

(4) The drug-free safety program bonus established in rule 4123-17-58 of the Administrative Code.

(B) The bonus and rebate incentive levels are as set forth in the appendix to this rule. The administrator may review the bonus and rebate incentive levels on an annual basis and make recommendation to the board of directors regarding the appropriate levels for each policy year.

(C) Application of bonus and rebate incentives.

(1) Bonus and rebate incentive earned through participation cannot reduce an employers premium due below the amount of the minimum administrative charge for the applicable policy year period as set forth in rule 4123-17-26 of the Administrative Code.

(2) bonus and rebate incentive earned through participation excellence shall not be issued to employers paying only the minimum administrative charge in the applicable policy year as set forth in rule 4123-17-26 of the Administrative Code.

(3) Rate adjustments made to an employer's account subsequent to the issuance of bonus or rebate incentives throught an employer's participation may result in recalculation of such incentives.

(4) To qualify for any incentive under this rule, an employer must:

(a) Have coverage that is in an active policy status at the time of calculation; and

(b) Report actual payroll for the preceding policy year, and pay any premium due upon reconciliation of estimated premium and actual premium for that policy year, no later than the date set forth in rule 4123-17-14 of the Administrative Code. An employer will be deemed to have met this requirement if the bureau receives the payroll report and the employer pays premium associated with such report before the expiration of any grace period established by the administrator pursuant to paragraph (B) of rule 4123-17-16 of the Administrative Code.

(D) An employer may voluntarily withdraw from a bonus or rebate incentive program by providing notice to the employer services division of the bureau of workers' compensation. Any bonus or rebate incentive earned during the policy year in which an employer withdraws from a bonus or rebate incentive program must be repaid to the bureau.

View Appendix

Last updated July 27, 2023 at 8:47 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29, 4123.34
Five Year Review Date:
Prior Effective Dates: 9/27/2013, 9/4/2014, 7/1/2015, 7/1/2019
Rule 4123-17-76 | Cancellation of workers' compensation coverage.
 

(A) The administrator of the bureau of workers' compensation may cancel an employer's workers' compensation coverage if any of the following apply:

(1) The employer fails to pay the required premium by the annual renewal date in accordance with rule 4123-17-14 of the Administrative Code, and the employer's estimated annual premium is equal to the minimum administrative charge as set forth in rule 4123-17-26 of the Administrative Code;

(2) The employer's policy is in lapsed status, and the employer's policy has no allowed claims filed against it within two years; or

(3) The employer is a new employer who failed to pay estimated premium and assessments when due.

(B) The effective date of cancellation shall be:

(1) For situations described in paragraph (A)(1) of this rule, the last date of the most recently completed policy year; or

(2) For situations described in paragraph (A)(2) of this rule, the bureau may select a date within the current policy year; or

(3) For situations described in paragraph (A)(3) of this rule, the original effective date of the policy.

(C) The administrator, for good cause shown, may retroactively cancel an employer's workers' compensation coverage. For purposes of this rule, "good cause" shall have the same meaning as in paragraph (B) of rule 4123-14-03 of the Administrative Code.

(D) An employer may cancel its workers' compensation coverage if all of the following criteria are met:

(1) The employer must notify the bureau in writing;

(2) One of the two following circumstances apply:

(a) The employer ceases operations in Ohio, or

(b) The employer no longer has employees as defined in division (A)(1)(b) of section 4123.01 of the Revised Code, and the employer agrees to cancel any supplemental or elective coverage as permitted under Chapter 4123. of the Revised Code; and

(3) The employer must submit the number of employees employed within each of the employer's assigned manual classifications and the aggregate amount of wages paid to such employees to the bureau and reconcile any premium that is due for the policy year, and any other missing policy years, as set forth in rule 4123-17-14 of the Administrative Code.

Last updated September 22, 2022 at 11:35 AM

Supplemental Information

Authorized By: 4121.12, 4121.121
Amplifies: 4123.29
Five Year Review Date:
Prior Effective Dates: 3/13/2017