Ohio Worker's Comp system denies that it overbilled employers

Backed by business and labor groups, the state agency for injured workers has filed new legal documents in its fight to overturn a judge’s ruling that some employers were overcharged $860 million in workers’ compensation premiums from 2001 to 2009.

The Ohio Bureau of Workers’ Compensation is appealing a ruling in March by Judge Richard McMonagle of Cuyahoga County Common Pleas Court in a lawsuit that charged that the bureau improperly gave discounted premiums to employers that joined group-insurance plans while charging higher rates to those not in the groups.

A group of about 270,000 employers called Pay Us Back Ohio BWC filed the lawsuit. Many members of the group are small-business owners.

About $105 million of the $860 million is owed to 35,000 businesses in the Columbus area, including 3,000 owed $5,000 or more and 143 due at least $100,000, the group says. One employer is due $1.4 million.

“We continue to believe BWC acted within its authority in establishing rates and that the plaintiffs’ claims are without merit,” Steve Buehrer, the bureau’s CEO, said in a statement issued yesterday.

On Friday, the bureau filed a brief with the 8th District Court of Appeals in Cleveland outlining the reasons it believes the ruling should be overturned. It was backed by a separate brief filed by groups that include the Ohio Chamber of Commerce, the National Federation of Independent Business and the AFL-CIO.

“The level of uncertainty caused by this decision is unacceptable for both businesses that pay into the system as well as workers who depend on BWC to provide medical care and wage replacement when they are injured,” said Andrew Doehrel, the chamber’s president and CEO.

In the brief, the bureau defends its right to set rates and says letting the court set rates sets a dangerous precedent.

“The law does not allow the court to override BWC’s rate-setting discretion and retroactively set workers’ compensation premiums where, as here, BWC acted lawfully and within its discretion,” the brief says.

A spokesman for Pay Us Back said the bureau is misstating the facts in the appeal documents.

“Instead of doing the right thing and paying back the 270,000 Ohio employers they admit they overcharged, all we are seeing are more costly legal games,” spokesman Brian Wright said in a statement.

Wright said McMonagle’s ruling ordered the bureau to comply with the law.

“What the ruling undercuts is a failed group rating system that forced Ohio employers’ workers’ compensation rates to skyrocket, in some cases as high as 8,000 percent,” he said. “Thousands of Ohio job creators went out of business because of their failed policies.”

The bureau’s appeal comes two months after it outlined steps to help the state’s employers. They include $1 billion in rebates of workers’ compensation premiums for more than 200,000 employers, rate reductions for public and private employers, and grants to make workplaces safer.

The bureau also has argued that employers in the lawsuit received $1.26 in benefits for every $1 in premiums they paid, and that half of all the class members would receive less than $200 from the case.

——————–