Bill Analysis

Legislative Service Commission

LSC Analysis of House Bill

Sub. H.B. 15*

128th General Assembly

(As Reported by S. Insurance, Commerce, & Labor)

(Excluding appropriations, fund transfers, and similar provisions)

 

Reps.     Sykes, Dodd, Bolon, Boyd, DeBose, Domenick, Dyer, Foley, Harris, Koziura, Letson, Luckie, Mallory, Moran, Stewart, Szollosi, Ujvagi, Weddington, B. Williams, S. Williams, Yates, Yuko

BILL SUMMARY

·         Creates in the state treasury the "Deputy Inspector General for the Bureau of Workers' Compensation and the Industrial Commission Fund" and requires the Inspector General to use the Fund to pay the costs incurred by the Deputy Inspector General for the Bureau of Workers' Compensation and the Industrial Commission in the performance of the Deputy Inspector General's duties.

·         Specifies that the Fund consists of moneys deposited into it from the Administrator of Workers' Compensation and the Industrial Commission in accordance with the bill's requirements.

·         Makes the existing law Surplus Fund an account within the State Insurance Fund. 

·         Eliminates the requirement that 10% of the money paid into the State Insurance Fund be set aside to create the Surplus Fund and the other limits specified for the amount of money that must be allocated to the Surplus Fund.

·         Allows the Administrator to transfer a portion of the State Insurance Fund to the Surplus Fund Account as the Administrator determines is necessary to satisfy the needs of the Surplus Fund Account and to guarantee the solvency of the Fund and the Account.

·         Changes the date by which the Bureau of Workers' Compensation Board of Directors Nominating Committee must submit to the Governor an initial list of names to fill a vacancy due to term expiration on the Bureau of Worker's Compensation (BWC) Board of Directors to at least 30 days prior to the term expiration, rather than within 60 days after the term expires as under current law.

·         Specifies that if the Governor appoints an individual to fill a vacancy resulting from the expiration of a term, the individual appointed begins serving as a Board member when that term expires or, if the term already has expired, immediately upon appointment by the Governor, whichever occurs later.

·         Changes the date by which the Board of Directors must submit to specified entities the annual actuarial report required under continuing law to a point in time that is on or before the first day of November following the year for which the valuation was made, rather than not later than the first day of September as under current law.

·         Requires the Board to submit a report annually on the performance and value of each investment class to the Workers' Compensation Council in addition to other entities already specified in continuing law.

·         Specifies various notification requirements relating to the group rating program.

·         Requires the Administrator to offer a Drug Free Workplace Program and a Workplace Safety Program and to offer a discount for participation in those programs to both employers who and who do not participate in the group rating program.

·         Requires certified health care providers to bill employers participating in the Medical-Only Program the same rates for services as the provider bills the Administrator, and prohibits certified health care providers from billing the employee for any amount in excess of the rate charged to the employer.

·         Allows a municipal power agency to self-insure a construction project.

·         Requires the Administrator to adopt rules revising a program or alternative premium plan not later than the first day of September prior to the policy year in which the program or alternative premium plan is to be in effect.

·         Requires the Bureau to offer a construction industry cap to eligible construction industry employers for a specified period of time.

·         Gives the Superintendent of Insurance the sole authority to regulate any insurance products that indemnify or insure employers against workers' compensation losses.

·         Permits, instead of requires, the Workers' Compensation Council to contract with an actuary to perform an actuarial valuation of the assets, liabilities, and funding requirements of the Workers' Compensation funds.

·         Splits the appointing authority of the Speaker of the House of Representatives and the President of the Senate for the Workers' Compensation Council.

·         Removes the authority of the Administrator to establish, under the supervision of the Director of Rehabilitation who is appointed by and responsible to the Administrator, the BWC Division of Rehabilitation.

·         Eliminates the requirement that the Labor-Management Council submit a list of names of individuals to the Administrator from which the Administrator must appoint an individual to serve as the Director of Rehabilitation.

·         Adds two members to the Labor-Management Government Advisory Council.

·         Creates the Competitive Workers' Compensation Task Force for the purpose of reviewing the feasibility of allowing employers the option to obtain private insurance to insure their obligations under the Ohio Workers' Compensation system.

TABLE OF CONTENTS

Deputy Inspector General for the Bureau of Workers' Compensation and
Industrial Commission Fund. 4

Surplus Fund Account within the State Insurance Fund. 4

Deadline to submit names to the Governor for BWC Board of Directors appointments. 5

Annual actuarial report due date. 6

Copy of investment reports to the Workers' Compensation Council 6

Group Rating Program.. 6

Merger of employer participating in Group Rating Program.. 6

Notification to employer of participating groups. 7

Notification of lump sum settlements or handicap reimbursement activities. 7

Drug Free Workplace Program.. 7

Workplace Safety Program.. 7

Medical-Only Program.. 8

Self-insuring employers. 8

Adoption of rules affecting premium rates. 8

Experience modification rate for the construction industry. 8

Contracts or agreements that indemnify or insure employers against
workers' compensation losses. 9

Workers' Compensation Council 9

Contract with an independent actuary. 9

Appointees to the Council 11

References to BWC's Division of Rehabilitation. 12

Background--the Division of Rehabilitation. 12

Removal of authority to establish the Division of Rehabilitation. 13

Competitive Workers' Compensation Task Force. 13

The Labor-Management Government Advisory Council 15

 

CONTENT AND OPERATION

Deputy Inspector General for the Bureau of Workers' Compensation and Industrial Commission Fund

Under continuing law, the Office of the Deputy Inspector General for the Bureau of Workers' Compensation and Industrial Commission exists in the Office of the Inspector General.  The Deputy Inspector General must investigate wrongful acts or omissions that have been committed by or are being committed by officers or employees of the Bureau of Workers' Compensation (BWC) and the Industrial Commission.  The Deputy Inspector General has the same powers and duties regarding matters concerning BWC and the Commission as those specified in continuing law for the Inspector General.  The Inspector General appoints the Deputy Inspector General, and the Inspector General must provide professional and clerical assistance to the Deputy Inspector General.  (Sec. 121.52.)

The bill creates, in the state treasury, the "Deputy Inspector General for the Bureau of Workers' Compensation and Industrial Commission Fund," which consists of moneys deposited into it that the Inspector General receives from the Administrator of Workers' Compensation and receives from the Industrial Commission.  The Inspector General must use the Fund to pay the costs incurred by the Deputy Inspector General in performing the Deputy Inspector General's duties as required under continuing law.  (Sec. 121.52.)

Surplus Fund Account within the State Insurance Fund

Under continuing law, the BWC Board of Directors and the Administrator have the duty to safeguard and maintain the solvency of the State Insurance Fund and all other funds specified in Ohio's Workers' Compensation Law.  (R.C. Chapters 4121., 4123., 4127., and 4131.)  (Sec. 4123.34.)  Current law requires the Administrator, in fixing the rates of premium for the various occupations or industries, to set aside 10% of the money paid into the State Insurance Fund for the creation of a surplus until the surplus amounts to the sum of $100,000, after which time, whenever necessary in the Administrator's judgment to guarantee a solvent State Insurance Fund, a sum not exceeding 5% of all the money paid into the State Insurance Fund must be credited to the Surplus Fund.  In addition to all statutory authority under the Workers' Compensation Law, the Administrator has discretionary and contingency authority to make charges to Surplus.  The Administrator must account for all charges, whether statutory, discretionary, or contingency, that the Administrator may make to Surplus.  (Sec. 4123.34(B).)

The bill makes the existing law Surplus Fund an account within the State Insurance Fund.  The bill also eliminates the requirement that 10% of the money paid into the State Insurance Fund be set aside to create the Surplus Fund and the limits specified for the amount of money that must be allocated to the Surplus Fund as described immediately above.  Instead, under the bill, an unspecified amount of the money paid into the State Insurance Fund must be set aside to create the Surplus Fund Account, and thereafter, the Administrator may transfer such portion of the State Insurance Fund to the Surplus Fund Account as the Administrator determines is necessary to satisfy the needs of the Surplus Fund Account and to guarantee the solvency of the State Insurance Fund and the Surplus Fund Account.  The bill also deems any references in the Workers' Compensation Law to the "Surplus Fund," the "Surplus" created in this provision, the "Statutory Surplus Fund," or the "Statutory Surplus of the State Insurance Fund" as being the equivalent to references to the "Surplus Fund Account."  (Sec. 4123.34(B).)

Deadline to submit names to the Governor for BWC Board of Directors appointments

The Governor, with the advice and consent of the Senate, must appoint the members of the BWC Board of Directors (sec. 4121.12(A)).  In making appointments to the Board, continuing law requires the Governor to select the members from the list of names submitted by the Workers' Compensation Board of Directors Nominating Committee pursuant to requirements specified in continuing law.  Continuing law requires the Governor, within 14 days after the submission of the list, to appoint individuals from the list.  (Sec. 4121.12(C).)

Current law requires the Nominating Committee, within 60 days after a vacancy occurring as a result of the expiration of a term and within 30 days after other vacancies occurring on the Board, to submit an initial list containing four names for each vacancy.  Continuing law specifies deadline requirements for choosing members from and resubmissions of that list.  Under the bill, the Nominating Committee must submit the initial list to the Governor at least 30 days prior to the expiration of a term, rather than within 60 days after the expiration of a term as required under current law.  Under the bill, if the Governor appoints an individual to fill a vacancy occurring as a result of the expiration of a term, the individual appointed must begin serving as a Board member when the current term expires or, if the term already has expired, immediately upon appointment by the Governor, whichever occurs later.  The bill does not change the remaining deadlines specified in continuing law.  (Sec. 4121.12(C).)

Annual actuarial report due date

Continuing law requires the Board to contract to have prepared annually by or under the supervision of an actuary a report that consists of an actuarial valuation of the assets, liabilities, and funding requirements of the funds specified in the Workers' Compensation Law (sec. 4121.125(C) and (E)).  The firm or person must prepare a report of the valuation and include all of the information specified in continuing law regarding that report.  Under current law, the firm or person must submit the report to the Board, and the Board must submit the report to the Workers' Compensation Council and the standing committees of the House of Representatives and the Senate with primary responsibility for workers' compensation legislation not later than the first day of September following the year for which the valuation was made.  The bill requires the Board to submit the report to the Council and the standing committees on or before the first day of November following the year for which the valuation was made, rather than not later than the first day of September as under current law.  (Sec. 4121.125(C)(3).)

Copy of investment reports to the Workers' Compensation Council

Under continuing law, the Board must submit a report annually on the performance and value of each investment class to the Governor, the President and Minority Leader of the Senate, and the Speaker and Minority Leader of the House of Representatives.  The bill requires the Board also to submit that report to the Workers' Compensation Council.  (Sec. 4121.12(F)(12).)

Group Rating Program

Merger of employer participating in Group Rating Program

An employer that is merging operations with another employer is required under the bill to notify the Administrator of Workers' Compensation of the merger no more than 30 days after the merger takes effect.  If the Administrator receives such a notice from one or more employers of a merger and if any employer involved in the merger participates in the Group Rating Program, the Administrator is required by the bill to provide a written notice to the organization that sponsors and the third party administrator that administers the group plan in which the employer who is involved in the merger participates informing that organization and the third party administrator about the merger.  The Administrator must notify the organization that sponsors and the third party administrator that administers the group plan in which a merging employer participates for every employer that participates in the Group Rating Program that is involved in a merger.  (R.C. 4123.29(A)(4)(h).)

Notification to employer of participating groups

The Administrator of Workers' Compensation is required under the bill to supply an employer, at the time the employer institutes workers' compensation coverage under Ohio's Workers' Compensation Law and first selects a managed care organization under the health partnership program, with a list of all groups participating in the group rating program and a list of all premium discount programs offered by the Administrator under Ohio's Workers' Compensation Law (R.C. 4123.29(B)).

Notification of lump sum settlements or handicap reimbursement activities

Prior to charging the experience of an employer who participates in a group plan for any lump sum settlements or handicap reimbursement activities, the Administrator of Workers' Compensation is required under the bill to provide a written notice to the organization that sponsors the group plan in which the employer participates and the third party administrator that administers the group plan for the employer's group informing that organization and third party administrator about the lump sum settlement or the handicap reimbursement activities (R.C. 4123.29(A)(4)(f)).

Drug Free Workplace Program

Under current law, the Administrator of Workers' Compensation, by administrative rules, offers a Drug Free Workplace Program (O.A.C. 4123-17-58), although, the program is not specifically required by Ohio's Workers' Compensation Law.  Commencing with the Bureau of Workers' Compensation policy year beginning on July 1, 2010, the bill requires the Administrator to offer a Drug Free Workplace Program that is substantially similar to the Drug Free Workplace Program currently offered by the Bureau to all employers, whether or not the employers participate in the Group Rating Program.  The Administrator is required to provide any employer who participates in the Drug Free Workplace Program a discount on the employer's premiums.  The Administrator of Workers' Compensation also is prohibited by the bill from placing a limit on the length of time that an employer may participate in the Bureau of Workers' Compensation Drug Free Workplace Program.  (R.C. 4123.34(H) and (I).)

Workplace Safety Program

Commencing with the Bureau of Workers' Compensation policy year beginning on July 1, 2010, the bill requires the Administrator to offer a Workplace Safety Program that is substantially similar to the workplace safety program currently offered by the Bureau to all employers, whether or not the employers participate in the Group Rating Program.  The Administrator is required to provide any employer who participates in the Workplace Safety Program a discount on the employer's premiums. (R.C. 4123.34(G).)

Medical-Only Program

Current law permits an employer to participate in the Medical-Only Program, whereby the employer can pay to the claimant or on behalf of the claimant the first $15,000 of a compensable workers' compensation medical-only claim filed by that claimant that is related to the same injury or occupational disease.  The bill requires certified health providers to extend to an employer participating in the Medical-Only 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.  The bill prohibits certified health providers from charging, assessing, or otherwise attempting to collect from an employee any amount for covered services or supplies that is in excess of the rate charged to the employer.  (R.C. 4123.29(A)(6).)

Self-insuring employers

Under current law, employers that are otherwise deemed allowed to participate may self-insure a construction project.  The bill includes a municipal power agency as defined in Ohio's Acid Rain Control and Byproduct Disposal Facilities Law (R.C. Chapter 3734.) as an employer that is otherwise allowed to self-insure a construction project.[1]  (R.C. 4123.35(R).)

Adoption of rules affecting premium rates

The Administrator of Workers' Compensation, in adopting rules to establish or revise a program or alternative premium plan offered by the Administrator that affects premium rates, is required under the bill to adopt those rules not later than the first day of September prior to the policy year in which the program or alternative premium plan is to be in effect, except for the premium year starting July 1, 2010, in which case the Administrator must adopt the rules not later than January 1, 2010 (R.C. 4123.29(C)).

Experience modification rate for the construction industry

The bill requires the Bureau to offer a construction industry cap on the employer's experience modification to an eligible construction industry employer for the policy year beginning July 1, 2009 and ending June 30, 2010, and thereafter until the Bureau completes the Bureau's transition to the adoption of a split-experienced rating plan in conformity with the current methodology of the National Council of Compensation Insurance.  Under the cap, the Bureau is required to establish the employer's experience modifier at .99 for the policy year beginning July 1, 2009, and ending June 30, 2010, unless the employer opts not to participate.  The Bureau is required to adjust the premium rate calculation of a participating employer by including an adjustment factor in the calculation of the blended rate of the employer to establish a blended rate that the employer would have paid as established by using the initially calculated experience modifier. 

The construction industry cap is available to a construction industry employer that satisfies all of the following requirements:

(1)  The employer's predominant premium for the policy year beginning July 1, 2007, is in Industry Group 4, Construction, as identified in Appendix A to section 4123-17-05 of the Ohio Administrative Code;

(2)  The employer had an experience modifier of less than or equal to 1.0 in the preceding policy year;

(3)  The experience modifier initially calculated for the employer for the current policy year is greater than 1.0 and not more than 1.5;

(4)  The employer participates in a safety program approved by the Bureau or by the Occupational Safety and Health Administration during the policy year to improve accident prevention.  (Section 220.)

Contracts or agreements that indemnify or insure employers against workers' compensation losses

Under current law, it is not clear who enforces requirements and prohibitions against insurance corporations and employers with respect to contracts or agreements that indemnify or insure employers against workers' compensation losses.  The bill gives the Superintendent of Insurance the sole authority to regulate any insurance products, except those products offered by the Bureau of Workers' Compensation, that indemnify or insure employers against workers' compensation losses in this state or that are sold to employers in this state.  (R.C. 4123.82(D).)

Workers' Compensation Council

Contract with an independent actuary

Under current law, the Workers' Compensation Council is required to contract with an independent actuary to have that actuary perform an actuarial valuation of the assets, liabilities, and funding requirements of the funds specified in Ohio's Workers' Compensation Law.  The Council must submit to the Governor and the General Assembly a report summarizing the valuation not later than September 10, 2009.  The bill changes this requirement to allow the Council to contract with an independent actuary to perform any of the following work as the Council determines is necessary:

(1)  An actuarial valuation as required in current law;

(2)  A review of a recent actuarial valuation performed pursuant to Ohio's Workers' Compensation Law;

(3)  A review of the study the Administrator of Workers' Compensation is required to commission to review the base rate premiums paid by employers and all of the rating programs used by the Administrator to determine an employer's premium rate under Ohio's Workers' Compensation Law;

(4)  A review of any actuarial analysis of any of the funds specified in Ohio's Workers' Compensation Law that is completed as required by the Auditor of State.

If the Council contracts with an actuary, as described above, the bill requires that actuary to prepare a report of the review in accordance with the standards of practice promulgated by the Actuarial Standards Board of the American Academy of Actuaries and to submit that report to the Council.  The actuary must include all of the following information in the report:

(1)  A summary of the valuation, study, or analysis the actuary reviewed;

(2)  The actuarial assumptions and methods and the data underlying the valuation, study, or analysis, as appropriate;

(3)  An assessment of the adequacy of each of the funds specified in Ohio's Workers' Compensation Law that were evaluated to pay the claims authorized under that law;

(4)  A discussion of the reasonableness of the findings of valuation, study, or analysis, and whether the valuation, study, or analysis was performed in accordance with the actuarial standards of practice promulgated by the Actuarial Standards Board of the American Academy of Actuaries;

(5)  A description of any additional studies the actuary recommends to assist the Council in the performance of its duties.

The bill requires the Council to submit the summary of the report completed by the actuary not later than September 10, 2011.  (Section 215.01.)

If the Council contracts with an actuary as described above on or before January 31, 2011, the bill requires the Director of the Workers' Compensation Council to request the funds necessary to cover the expenses of the valuation or review, which amount must not exceed $650,000, from the Administrator.  The Administrator is required to direct the Treasurer of State to transfer the amount requested by the Director from the Workers' Compensation Fund to the Workers' Compensation Council Fund.  The Administrator and Director must agree to a schedule for the transfer of these funds.  (Section 203.)

Appointees to the Council

Under current law, the Workers' Compensation Council has five members jointly appointed by the President of the Senate and the Speaker of the House of Representatives, not more than three of whom must be members of the same political party, one of whom must represent employers who employ 100 or more employees, one of whom must represent employers who employ less than 100 employees, one of whom must represent employees, one of whom must represent injured workers, and one of whom must represent the public and also be an individual who, on account of the individual's previous vocation, employment or affiliations, cannot be classed either as predominantly representative of employees or of employers.  Of those five members, at least one must be a person with investment expertise.  The bill instead requires those five members to be appointed as follows:

(1)  The President of the Senate must appoint one member who represents employers who employ less than 100 employees and one member who represent injured workers;

(2)  The Speaker of the House of Representatives must appoint one member who represents employers who employ 100 or more employees and one member who represents employees;

(3)  The Speaker of the House of Representatives and the President of the Senate must alternate in the appointment of, for a term, one member who represents the public and also is an individual who, on account of the individual's previous vocation, employment, or affiliations, cannot be classed as either predominantly representative of employees or of employers.

The bill retains the requirement that one of the five members be a person with investment expertise.  Current law fixes the terms of members at three years.  The bill specifies that the member who represents the public, as described in (3), above, must serve a term of two years.  (R.C. 4121.75.)

The bill requires all members serving on the Council on the effective date of the changes to the Council appointments to serve the duration of their terms as appointed.  Upon the expiration of the terms of those members, new appointments must be made to the Council as specified under the bill, as described above.  With respect to the member who represents the public as described in (3), above, the President of the Senate must make the initial appointment.  (Section 217.)

References to BWC's Division of Rehabilitation

Background--the Division of Rehabilitation

The Administrator, with the advice and consent of the Board, must adopt rules, take measures, and make expenditures as the Administrator deems necessary to aid claimants who have sustained compensable injuries or incurred compensable occupational diseases pursuant to the Workers' Compensation Law to return to work or to assist in lessening or removing any resulting handicap (sec. 4121.61, not in the bill).  In exercising this authority, current law grants the Administrator the authority to establish within BWC a rehabilitation division under the supervision of a Director of Rehabilitation appointed by and responsible to the Administrator (sec. 4121.62(A)(4)).  Under current law, the Labor-Management Government Advisory Council must recommend to the Administrator three candidates, who must be chosen for their ability and background in the field of rehabilitation, for the position of Director of Rehabilitation.  The Administrator must select a director from the list of candidates.  (Sec. 4121.70.)

Current law places the Director in the unclassified civil service and allows the appointing authority to designate up to three positions at each facility under the Division's jurisdiction and up to six positions in the Division that are part of the Director's immediate staff as being in the unclassified service as long as the Administrator determines that the positions are primarily and distinctively administrative, managerial, or professional.  All other full-time employees of the Division are in the classified civil service.  (Sec. 4121.62(B).) 

The Administrator currently must establish fees for use of services offered by the Division, including, without limitation, the expense of providing rehabilitation services, counseling, and training.  The Administrator must adopt rules, in accordance with the Administrative Procedure Act, which establish the specific services the Division offers and the amount of the fee for those services, and that amount must be based upon the actual cost of the Division providing the services to the employer and employee.  (Sec. 4121.62(C).)

Removal of authority to establish the Division of Rehabilitation

The bill specifically removes mention of the Administrator's authority to establish the BWC Division of Rehabilitation and appoint the Director of Rehabilitation and eliminates the requirement that the Labor-Management Council submit names of individuals to be appointed as the Director of Rehabilitation.  The bill also removes the requirement that the Administrator adopt rules to establish the services to be offered by the Division and the amount of fees to be charged for those services as described above.  The basic authority of the Administrator, however, to provide for the rendition of rehabilitation services remains in law.  (Secs. 4121.62 and 4121.70.)

Competitive Workers' Compensation Task Force

The bill creates the Creative Workers' Compensation Task Force, which consists of 17 members, for the purpose of reviewing the feasibility of allowing employers the option to obtain private insurance to insure their obligations under the Ohio workers' compensation system.  The bill requires the Task Force to be appointed not less than 60 days after the effective date of the act as follows:

(1)  The Governor must appoint the following members:

(a)  Two representatives of employees (claimants) that fulfill the following criteria:

(i)  One representative must be employed by a state fund employer and one must be employed by a self-insuring employer;

(ii)  One representative must be employed by an employer that employs employees who are represented by a labor organization and one must be employed by an employer that does not employ employees who are represented by a labor organization.

(b)  One representative who is a state fund employer domiciled in Ohio;

(c)  One representative who is a self-insuring employer domiciled in Ohio;

(d)  One representative who is a lawyer admitted to the practice of law in Ohio who primarily represents claimants before the Industrial Commission;

(e)  One representative who is a lawyer admitted to the practice of law in Ohio who primarily represents employers before the Industrial Commission;

(f)  One representative who is a full-time employee of a third-party administrator that does business in Ohio;

(g)  One representative who is a full-time employee of a managed care organization that does business in Ohio;

(h)  Two representatives who are full-time employees of property and casualty insurance companies that are domiciled in Ohio or that are otherwise doing business in Ohio that offer to write workers' compensation coverage in at least ten states other than Ohio;

(i)  One representative who is a state fund employer who conducts business in Ohio and at least one other state;

(j)  One representative who is a self-insuring employer who conducts business in Ohio and at least one other state.

(2)  The Speaker of the House of Representatives must appoint one member from the majority party.

(3)  The President of the Senate must appoint one member from the majority party who must serve as a co-chairperson.

(4)  The Administrator of Workers' Compensation, or the Administrator's designee, the Chairperson of the Bureau of Workers' Compensation Board of Directors, or the Chairperson's designee, and the Superintendent of Insurance must be members of the Task Force, and the Superintendent must serve as a co-chairperson of the Task Force.

The bill allows the Task Force to contract with a firm that possesses significant property and casualty and workers' compensation insurance actuarial evaluation experience to do all of the following:

(1)  Evaluate the current workers' compensation offerings offered by the Bureau of Workers' Compensation to determine if such offerings are actuarially sound and competitive with similar offerings in other states while taking into account variations in available benefit levels;

(2)  Evaluate and describe the efforts made by other states within the last 15 years to open those states' workers' compensation markets to private competition, which must include the identification and description of those states' best practices in planning for and implementing a transition from a state-funded monopolistic workers' compensation system to a market that includes private competition;

(3)  Identify at least three business plan options through which Ohio can introduce viable private workers' compensation competition along with or without the current state fund administered by the Bureau of Workers' Compensation and the Industrial Commission.

If the Task Force contracts with a firm as described above, the bill requires the Task Force to solicit bids from appropriate vendors and award the contract described above in a competitive manner.  The bill prohibits the agenda, discussions, or outcomes of the work of the Task Force, or any firm with which the Task Force contracts, from being constrained in any manner by current law with respect to workers' compensation insurance.

The Task Force is required, under the bill, to make findings on the issues described above and report such findings to the Governor, the Speaker of the House of Representatives, and the President of the Senate not later than June 30, 2010.

The bill requires that members of the Task Force be reimbursed for any travel expenses.  (Section 301.)

The Labor-Management Government Advisory Council

Under current law, the Labor-Management Government Advisory Council consists of 12 members.  The bill adds both of the following members to the Council, to be appointed as specified:

(1)  One person who by training and vocation represents nonprofit vocational rehabilitation services providers that deliver services to injured workers, appointed by the Speaker of the House of Representatives;

(2)  One person who by training and vocation represents nonprofit vocational rehabilitation services providers that deliver services to injured workers, appointed by the President of the Senate.  (R.C. 4121.70.)

The bill requires the members added to the Council, as described above, to be appointed within 60 days after the effective date.  The new members appointed to the Council as required under the bill must serve terms of six years, and subsequent appointments must be made as provided in current law.  (Section 219.)

HISTORY

ACTION

DATE

 

 

Introduced

02-17-09

Reported, H. Insurance

03-18-09

Re-referred to H. Finance & Appropriations

03-18-09

Re-reported, H. Finance & Appropriations

03-24-09

Passed House (90-8)

03-24-09

Reported, S. Insurance, Commerce, & Labor

      ---

 

 

 

H0015-RS-128.docx/jc



* This analysis was prepared before the report of the Senate Insurance, Commerce, and Labor Committee appeared in the Senate Journal.  Note that the list of co-sponsors and the legislative history may be incomplete.

[1] A "municipal power agency" is defined as any Ohio nonprofit corporation, the members of which are municipal corporations that own and operate electric utility systems, that sells electricity to its members for resale (R.C. 3734.058).