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Published: Thursday, 8/16/2007

New director aspires to fix broken BWC

Marsha Ryan says the state s $21 billion system for handling claims and setting employee premiums needs improvements. Marsha Ryan says the state s $21 billion system for handling claims and setting employee premiums needs improvements.
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COLUMBUS The state s $21 billion system for handling claims from injured workers and setting the premiums their employers pay is pretty broken, and it may take years of work before public trust is restored, the new director of Ohio s insurance fund for injured workers said yesterday.

The premiums employers pay are unstable and some workers face inappropriately long waiting periods after filing claims, said Marsha Ryan, administrator of the Ohio Bureau of Workers Compensation.

Individuals view Ohio s worker compensation system as being pretty broken, Ms. Ryan said. She indicated that she agrees with that perception.

Ms. Ryan said the side of the bureau that deals directly with workers did not receive the type of attention that fixed a scandal involving the bureau s billions of dollars in investments.

The Blade first reported in April, 2005, about problems with a $50 million rare-coin investment the bureau placed with Tom Noe, a GOP fund-raiser and Toledo-area coin dealer.

Fallout from the scandal helped end a dozen years of GOP power in the state.

We have a big job to do to overcome the criticism that I ve heard of the bureau that lack of predictability, that lack of simplicity in the processes, Ms. Ryan said.

She said the bureau s past practice of awarding discounts to employers when the agency s investments were good did not allow for long-term planning to keep premiums stable.

With the help of the agency s new board of directors, she wants politics taken out of that rate-setting process, she said.

We are going to be very planful, not political about the system, Ms. Ryan said.

With this very accomplished group of directors that we have coming in, we will be able to avoid the temptation to do things that simply satisfy a short-term need.

One of Ms. Ryan s first tasks is to review the agency s practice of providing group discounts to employers who belong to various alliances, such as the Ohio Chamber of Commerce or National Federation of Independent Business.

She said three separate reviews have found the practice has contributed to the volatility of rates.

Adjusting rates to spread the burden more evenly among employers in and out of such groups is likely to bring the base premium rate down, she said, though group participants with the deepest discounts may see rates go up.

Business groups said they were open to talk about rate-setting but some disagreed that the system is broken.

Injured workers are being taken care of and we re working to get them back to work as soon as possible, said Ty Pine, legislative director for the National Federation of Independent Business-Ohio.

Despite the problems the bureau has faced, we re still doing a reasonable job at that.

Providing refunds to employers when investment returns are good is important in Ohio, whose public workers comp system constitutes a monopoly, said Tony Fiore, director of labor issues for the Ohio Chamber of Commerce.

Among Ms. Ryan s early acts was to hire the bureau s first ever actuary to professionally assess investment risks.

She also said:

• Making the system better for workers and employers matters more than whether Ohio has a public workers comp system or one that is privately run.

Workers comp can either be a detriment to the vitality of business in Ohio and therefore to employment in general, or it can be a benefit, and I d like to see it be a benefit.

Whether that s as a public entity or whether it s some other model is less relevant.

• Internal controls and documentation have been weak for years and must be strengthened to restore credibility in the bureau s operations.

Creating a culture of accountability here at the bureau so that all the 2,400-plus state employees understand that it s important to be accountable, to be documenting, to be making decisions the right way all the time, is essential in the rebuilding of the trust.



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