Workers’ compensation experience

• Lost time – more than seven days lost; average cost $40,5000
• Frequency – number of claims in experience
• Severity – amount of medical/indemnity and days lost per claim
• Base-rated employers – expected loss rate of less than $8,000
• Experience-rated employers– premium varies with frequency and severity

How are rates calculated?

• EM = experience modifier
• Base rating = 1.0
• Experience rating:
  > Credit rated – less than or equal to .99 (saving money)
  > Penalty rated – greater than or equal to 1.1 (wasting money)

Group Rating

Combining similar employers and experiences equals greater discounts and savings.

Saving money

$55,523 Initial annual premium, EM = 1.10 (penalty rated)

EM = .95 (now credit rated)

Base-rated employer in group

$7,588 Initial annual premium, EM = 1.00 (base rated)

Drug-Free Workplace Program (DFWP)

• More than 25 employees
• Up-front discounts
  • Level 1 = 10-percent savings
  • Level 2 = 15-percent savings
  • Level 3 = 20-percent savings

Drug-Free EZ

• 25 or fewer employees
• Up-front discounts
  • Level 1 = 10-percent savings
  • Level 2 = 15-percent savings
  • Level 3 = 20-percent savings
  • 20 percent also possible by meeting claims goals

DFWP and Drug-Free EZ advantages

• Joining equals a 10-percent minimum premium reduction
• Grant money available
• Safer work environment/fewer injuries

Saving with DFWP

Safety GRANT$

• 4-to-1 matching ratio
• $40,000 from BWC for safety

DFWP Grant

• 2-to-1 matching ratio
• $10,000 average grant for training

Transitional Work GRANT$

• Safe and early return to work
• Lowers frequency and severity costs
• Savings continue annually
• $1,000 to $5,600 grants available

Saving with transitional work

Keys to financial management

• Keep EM less than 1.0
• Achieve and maintain group rating
• Join BWC’s premium-savings programs
• Allow BMSO to assist in managing your claims