COLUMBUS — Ohio’s private employers would pay nearly $132 million less in premiums to the Ohio Bureau of Workers’ Compensation next fiscal year under a 13% rate reduction proposed to the agency’s Board of Directors today.
If approved, the reduction would mark the third rate cut in three years for private employers and the 11th since 2008. It is also the third largest cut in 60 years, following the largest (20%) last year.
“We feel it’s appropriate to significantly reduce rates this year because our covered employees continue to experience fewer and less costly claims, and the recent medical inflation rate has been relatively low,” said BWC Administrator/CEO Stephanie McCloud.
If approved by the board at its Feb. 28 meeting, the rate reduction would be effective July 1, saving private employers $131.6 million over this year’s premiums. It also would follow a 10% rate reduction for public employers — counties, cities, schools and others — that went into effect Jan. 1. Overall, the average rate levels for the 249,000 private and public Ohio employers in the BWC system are at their lowest in at least 40 years.
Premiums paid to BWC not only cover health care and lost wages for injured workers, they also support BWC’s Safety & Hygiene Division, which offers training, consultations and other services to help employers improve workplace safety. Employer participation in these services has grown by more than 70% since 2010. Total annual claims, meanwhile, have fallen 19% over that time to 84,364 in 2019.
The proposed 13% rate cut represents an average statewide change and does not include the costs related to the administrative cost fund or other funds BWC administers.
The actual premium paid by individual private employers depends on several factors, including the expected future claims costs in their industry, their company’s recent claims history, and their participation in various BWC programs.