Oklahoma Option Savings? - Reduction in Fraud

If you are an employer that has had several claims, it's likely that you have seen multiple cases of what you might consider fraud. Some reasons employees do this include:

  • To get an off the job injury covered under workers compensation.  Workers with no medical coverage are prime for this and also workers comp has no deductible. 
  • To obtain a lump sum settlement.  We have seen some employees with over 10 workers comp claims all involving settlements and all involving the same attorney.
  • To obtain pills - Opioid abuse is at an all time high and Oklahoma is one of the worst states for this.  Many work comp doctors will prescribe a complete battery of pain killers which the injured employee may either sell on the black market or take themselves.

I break this down into complete fraud, in which the employee fabricates the entire injury, or modified fraud in which the employee gets legitimately injured and is then swayed by an attorney, friend, or coworker to modify their symptoms to obtain one or more of the above.  

The Oklahoma Option makes attorney involvement much harder for the average attorney who is used to dealing with the workers comp system because most claims will routinely be referred to Federal Court due to ERISA (Employee Retirement Income Security Act), which regulates these types of workers comp plans.  This can actually benefit the employer.  

The Oklahoma Option also greatly reduces the time for reporting a claim because employers can choose reporting requirements under this type of benefit plan. This will curtail the past practice of reporting claims months or often years after the claim allegedly happened.

Chris Moxley

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Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

Oklahoma Insurance Commissioner Presentation - New Work Comp Law

The State of Oklahoma Insurance Commissioner has released his presentation that was done a few weeks ago at various locations around Oklahoma.  It was a good basic overview of the new law (Senate Bill 1062), that goes into effect next year, and was free to attend.

 Click Here to Download

  

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Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

Oklahoma State Chamber Joins Work Comp Law Challenge

Senate Bill 1062, passed in 2013 has reduced workers comp rates in Oklahoma starting in 2014 but was recently challenged by the Firefighters Union, Sen. Harry Coates of Seminole, & Rep. Emily Virgin of Norman. Recently the Oklahoma State Chamber has filed a motion to join the lawsuit along with the Oklahoma City and Tulsa chambers of commerce.  

A hearing is set on Nov. 14

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Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

Missouri Workers Comp Loss Cost Rates Increase 11.6%

Last Month opponents of the new Workers Comp Law in Oklahoma filed suit to have the law overturned.  Rep Emily Virgin (D) Norman, was quoted as saying, she wanted a system more like Missouri.  About a week ago, NCCI released Missouri results and increased rates in Missouri's loss cost (base rates) by 11.6 percent.  Once the Insurance Carriers apply their multiplier the increases would be more around 15%.   

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Our Oklahoma Law  (Senate Bill 1062), along with other trends in Oklahoma has reduced our rates by 14.6 percent.  The total swing if you compare the two states is around 40% by the time carriers apply their loss costs multipliers.  Based on this knowledge, I think Rep. Virgin should reconsider her challenge.  We can't afford more rate hikes in Oklahoma.  We are running business out of our state and preventing new business from entering our state when we make our workers compensation system expensive compared to other states.  

Click Here for Missouri Powerpoint Presentation from NCCI

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Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

Oklahoma Insurance Commissioner releases Opt-Out Forms

The State of Oklahoma Insurance Commissioner has released some initial forms to be used to apply for the Oklahoma Option or Opting out

At this point it is difficult to simply look at the application form and decide what they may be looking at to approve or deny any particular company.  As I laid out in my prior article, there are still a lot of questions to be answered.  Rules are still being formed and will have to be approved to determine what the qualifications are.   

Here they are: 

Qualified Employer Election Form (opt out application) 

Qualified Employer Sample Certificate

Qualified Employer Notice Employers

 

Also find them on our RESOURCES Page along with other good information

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Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

New Oklahoma Workers Comp Law Challenged

Sentate Bill 1062, Scheduled to go into effect 2/1/2014 has been challenged by Rep Emily Virgin, D-Norman, Sen. Harry Coates, R-Seminole, and the Professional firefighters association.  The lawsuit claims the bill is unconstitutional.  The hearing could be before the middle of November and will be defended by the Oklahoma Attorney General's office.

Currently 8 of the 9 justices on the State Supreme court were appointed by past Democratic Governors and they have overturned workers comp and tort reforms in the past.  

The court could overturn the entire law and send it back to the legislature or overturn parts of the law they deem unconstitutional.   

Since 12.7 percent of the latest workers compensation rate decrease of 14.6 percent, set to go into place 1/1/2014 was because of Senate bill 1062, this could cause rates to increase or rate decrease to be revised.  

This could be the only challenge to the entire bill, but challenges to individual parts could challenged later. 

We will keep you update as things progresses. 

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Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

Oklahoma Workers Comp Rates to Drop 14.6% in 2014

OKLAHOMA CITY – An annual filing most insurance carriers will use to develop rates for workers’ compensation insurance shows a dramatic decrease in loss costs, Oklahoma Insurance Commissioner John D. Doak announced today. The overall loss cost decrease of 14.6 percent takes effect Jan. 1.

“This is fantastic news for Oklahoma businesses,” said Doak. “Reducing workers compensation costs by enticing new companies to come to the state and allowing current businesses to expand operations can trigger a new wave of economic prosperity. These decreases over a period of time will help to make Oklahoma much more competitive.”

The National Council on Compensation Insurance Inc. (NCCI) is an advisory organization that studies workplace injuries, collects workers’ compensation data, analyzes industry trends and prepares rate recommendations. The NCCI credits most of the decrease to the passage of SB 1062, which makes substantial changes to Oklahoma’s workers’ compensation system. The 14.6 percent projected reductions in loss costs represent the part of a workers’ compensation insurance premium for indemnity and medical payments and associated claim adjustment expenses, not reflecting overhead and profit.

“I commend Gov. Mary Fallin, Speaker of the House T.W. Shannon and Senate Pro Temp Brian Bingman for dedication to improving the state’s workers’ compensation system,” continued Doak. “With their outstanding leadership and belief in pro-growth policies, Oklahoma will continue to thrive.”

The overall average loss cost impact at an industry group level is as follows:

Industry Group Impact

Manufacturing -16.3%

Contracting -16.2%

Office and Clerical -13.4%

Goods and Services -14.1%

Miscellaneous -12.2%

TOTAL -14.6%

Other key observations from the report include lost-time claim frequency continuing to decline across the state, indemnity average cost per case increasing for latest policy year and loss adjustment expenses declining for a lower average than nationwide

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Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

Gov. Mary Fallin appoints first member of Workers Comp Commission

 The former CEO of Montgomery Bank, Troy Wilson,  has been named by Republican Gov. Mary Fallin as the first appointee to the newly created Oklahoma Workers Compensation Commission designed to oversee the state workers’ compensation system, the governor’s office said this week. Mr. Wilson also worked in other business including Xerox.

With her fist pick as a pro business appointee, it set's the stage for the commission to be more friendly to business and fair to injured workers.

Senate Bill 1062 passed this year created the workers compensation commission and largely goes into effect in February of 2014

Chris Moxley is the Vice President of Professional Insurors in Oklahoma City and specializes in Risk Management and Insurance plans to reduce business' total cost of risk.  His emphasis is in Workers Compensation  where he works with many companies in Oklahoma and surrounding states. 
Comment

Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

New Oklahoma Workers Comp Law - SB 1062

Option 1 - Administrative Workers Comp System - The Basics

This will be the default workers comp system for Oklahoma.  It replaces our court based workers comp system with an administrative one (commission).  It is expected to be less adversarial. Some important changes include:

  • It be run by a three member commission appointed by the Governor with input from the Speaker of the House and Senate President Pro Tem.  Their salaries will be about the same as a District Judge.
  • The Commission will appoint Administrative Law Judges to administer the system.  They will have the power to investigate or hold hearings. 
  • They can hear and approve compromise settlements and appoint mediators to resolve disputes through Alternative Dispute Resolution. 
  • They will hear and determine claims with no formal rules of evidence.  Medical evidence must be presented and the employee bears burden of proof based on a preponderance of the evidence.  The commission may also hear challenges to arbitration agreements and file judgments.

 The old system will continue for any claims filed before 2/1/14.  The changes to this system alone are expected to reduce workers comp rates by about 14% according to NCCI.  This part of the law is based on the Arkansas system.

Comment

Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.

Oklahoma Senate Bill 1062 Passes

Oklahoma recently passed a new bill that overhauls the state workers compensation system.  It consists of 3 parts: 

     
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  1. Replaces our court based workers comp system with an administrative one.  This will be run by a three member commission.  The old system will continue for any claims filed before 2/1/14.  The changes to this system alone are expected to reduce workers comp rates by about 14% according to NCCI.  This part of the law is based on the Arkansas system.
  2. Creates an Opt-Out system similar to Texas with important differences: Oklahoma's system will maintain sole remedy like workers comp and will require employers to meet certain requirements to participate.  Examples of this include purchasing occupational accident insurance to meet its financial obligations.  It also contains guarantee fund participation for insurers that operate in this system. 
  3. Creates Workers Comp Arbitration act.  This allows employers to implement an alternative dispute resolution for those under the Administrative system with binding arbitration.  

I will continue to release more information on this bill throughout the next several months.  It is truly a massive overhaul of our workers comp system.  Most expect legal challenges to this new law before it takes effect next year.

Comment

Chris Moxley

Chris began his career at a Norman insurance agency in 1988 serving as a Branch Manager for 3 years. He joined Professional Insurors in 1995 as a Producer and became Vice-President in 2004, where he overseas human resources and agency operations & technology as well as continuing to manage his client accounts and grow the business. The Agency works with a variety of accounts and Chris specializes in Workers Compensation Risk Management and Insurance. He has worked in Insurance for over 20 years and besides Workers Compensation he has specialized training and experience in the fields of Construction Risk Management and Risk Transfer, Property Management, & Manufacturing.