Safe-mail Fourth Quarter 2011
STATE ACCIDENT FUND Breaking Legal News: Pilot Program for the Voluntary Mediation of Workers’ Compensation Appeals
The South Carolina Workers’ Compensation Commission and the South Carolina Supreme Court have instituted a Pilot Program for the Voluntary Mediation of Workers’ Compensation Appeals. In 2007, the workers’ compensation statutes were amended to eliminate appeal to the Circuit Court and, instead, funnel cases directly from the Full Commission to the Court of Appeals. Apparently, the volume of appeals was higher than the courts anticipated. Under the new program, both parties can consent to mediate the issues on appeal. The appeal is held in abeyance for up to sixty days while mediation takes place. All costs, fees and expenses are equally split by the parties. If both parties do not consent, the appeal continues as normal. If the matter fails to settle either partially or wholly, the appeal is reinstated. If settled, the matter can, upon request, be remanded to the Commission for approval of the agreement and/or attorneys’ fees. SAF’s own Chief Counsel, Matt Robertson, is on the advisory committee.
In other news, recent cases have addressed issues regarding judicial notice and determining the weight to accord expert evidence. In Wise v. Richard Wise, Op. No. 4879 (S.C. App. filed 8/24/11), the Court of Appeals addressed the issue whether evidence of a civil suit settlement be admitted as after-discovered evidence or made the subject of judicial notice. The court held: A court can take judicial notice of its own records, files, and proceedings for all proper purposes including facts established in its records. It is not error for a judge to take judicial notice of what was stated in a former opinion in a prior action of the same case. The evidence does not have to be in existence at the time of the original hearing in order to be admissible. A party does not have to request the judge take judicial notice of the desired information (although it is unlikely he will unless requested). Notice can be requested on appeal. An appellate court can take judicial notice of something that was not before the trial court, if it is indisputable. Another new case from the Court of Appeals involves the weight to be accorded to expert evidence. In Potter v. Spartanburg School District 7, Op. No. 4890 (S.C. App. filed 9/14/11), the appeals court held that it was not error to give less weight to the testimony of Dr. Randy Waid, when other doctors, including the treating physicians, supported the decision of the Commission. “While an expert’s testimony is entitled to great respect, the Appellate Panel may disregard it if the record contains other competent evidence. Nor is the Appellate Panel bound by the opinion of medical experts.”
Contact INFORMATION… We are trying to make sure we have the most current contact information in our system. Please help us by taking a moment to send us an email (jtouchberry@saf.sc.gov) to verify your name, contact type (claims, safety, premium, executive), mailing address, interagency address (if applicable), and email address, especially if this was forwarded to you or you have had changes within your agency in the last three years. Thank you in advance!
Fourth Quarter 2011 Table of Contents
Breaking Legal News
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The Quality Connection for Safety
OSHA Fact Sheet
What is An Experience Modifier?
Term of the Quarter
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“Protecting you since 1943.”
This year marks the 100th anniversary of the workers’ compensation system in the United States.
State Accident Fund
Safe-mail Fourth Quarter 2011
The Quality Connection for Safety By Ray Coleman Safety and Loss Control/Team Leader Safety and Loss Control – encompassing all that a company does to reduce or avoid injuries, illness, property damage, and employee lost time – is one of the top priorities of the South Carolina State Accident Fund (SAF). The SAF reports the following as key safety elements in its program: MANAGEMENT COMMITMENT – Management must be committed to employee safety for the program to be effective. Management must have a clear policy statement and goals established. Effective managers assure the success of employee-driven safety committees and other teams by getting buy-in for the roles and responsibilities of all key players. They make sure that hourly personnel have both the training and the support that it takes for them to really contribute to a behavior-based safety change effort. Managers also communicate clearly with supervisors who need to understand their own roles as well as those of their workgroups. INSPECTIONS – Regular inspections promote continuous improvements in a company’s safety program. The SAF will help develop a checklist for members to use in implementing a quarterly inspection program. The SAF also performs a walk-through safety inspection for the members to make sure that OSHA’s requirements are being met. A report will be sent back to the person requesting the walk-through with all violations listed as well as recommendations for correcting. This report is meant to help you correct problem areas, we do not send a copy to OSHA. ACCIDENT INVESTIGATIONS – It is crucial to do everything possible to prevent accidents from occurring, but what is done after an accident is just as important. The SAF has a training class on accident investigation and highly recommends that every first report of
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injury and all near misses be investigated to determine contributing factors in order to help prevent the accident from reoccurring. SAFETY AND HEALTH TRAINING – A video library has been established for State Accident Fund members and is free to all members. To obtain a list of the videos, contact your Safety and Loss Control Representative. The SAF also conducts training classes for its members, and this service is also at no charge. In 2010 the State Accident Fund conducted over 200 training classes for its members. Promoting safety is the best way to combat rising workers compensation premiums. Any improvement is safety can quickly translate into savings. In the process of promoting safety, members can gain other essential benefits such as higher quality of work, improved morale, higher productivity, and better net returns. To help make your workplace safer, please contact one of our Safety and Loss Control Representatives: Barney Derrick, 803-8965935, or Ray Coleman, 803-896-5855.
“Safety and Loss Control— Encompassing all that a company does to reduce or avoid injuries, illness, property damage, and employee lost time-is one of the top priorities of the South Carolina State Accident Fund.”
State Accident Fund
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Safe-mail Fourth Quarter 2011
State Accident Fund
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Safe-mail Fourth Quarter 2011
State Accident Fund
Safe-mail Fourth Quarter 2011
What is An Experience Modifier? (Commonly known as an “E-Mod” Rate) Kirk Adair Premium Auditor, APA, AIC
The Experience Rating Plan (E-Mod) is a merit–rating plan approved by SAF and the National Council on Compensation Insurance (NCCI). The E-Mod computes an experience rating multiplier for each employer based on risk classification, payroll, and loss experience. It is calculated each year at the time of your policy renewal and can be found on your SAF Premium Statement. The E-Mod multiplier increases or decreases the amount of premium to be paid during each policy period.
considered “completed” because claims from this year have not fully matured)
The Experience Modifier (E-Mod) refers to your claims “experience” and builds your claims history into the calculation of premiums. It does this by calculating a multiplier which is used in your premium calculation. The more claims you have, the higher your experience modifier rate will be. The fewer claims you have, the lower your experience modifier will be.
The formula only counts 30% of medical-only claims payments. It also caps claims payments at a limit of $284,000 for single claims occurring between 7-1-10 to 7-1-11, and $296,000 for single claims occurring between 7-1-11 to 7-1-12 according to NCCI Rating Manual.
An experience modifier of 1.0 represents the average losses for any given industry. A policy holder with an E-Mod below 1.0 will pay a lesser premium than average. If a policyholder has an E-Mod of above 1.0 they will have an above average premium. See the example below: Premium Amount E-Mod Rate Standard Premium
$10,000 x 0.80 $8,000
Premium Amount E-Mod Rate Standard Premium
$10,000 x 1.20 $12,000
The claims data used to calculate your E-Mod rate consists of three completed years of claims experience. For example, a policy period of 1-1-11 to 1-1-12 would use the claims data from policy years 2007, 2008, 2009 because they are the last three completed years before the current policy period. (The year immediately preceding the current policy period is not
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The claims, payroll, and risk classifications are used in the E-Mod formula to produce the E-Mod rate for the current policy year. Therefore, claims from 2007, 2008, and 2009 will affect the E-Mod on your current 2011 policy. Limitations in the E-Mod Formula
What Can I Do to Reduce My E-Mod? Because accident frequency reflects the safety of your operation, it carries more weight in calculating a higher EMod than accident severity. Therefore, several smaller claims will affect the E-Mod more dramatically than a single accident that is more serious. Accidents happen. But fewer accidents happen in safe work environments. When you take steps to make your workplace safe, you are taking action to control your E-Mod factor. Please contact our safety consultants for suggestions on making your workplace safer. For more information about the E-Mods and premiums, please contact your Premium Auditors, Kirk Adair or Theresa Simmons at 803-896-5856 or 803-896-5857.
“Because accident frequency reflects the safety of your operation, it carries more weight in calculating a higher E-Mod than accident severity.”
State Accident Fund
Safe-mail Fourth Quarter 2011
Term of the Quarter: Alternative Work A new job with your former employer. If your doctor says you will not be able to return to your job at the time of injury, your employer is encouraged to offer you alternative work instead of supplemental job displacement benefits or vocational rehabilitation benefits. The alternative work must meet your work restrictions, last at least 12 months, pay at least 85 percent of the wages and benefits you were paid at the time you were injured, and be within a reasonable commuting distance of where you lived at the time of injury.
In memory of Melisa Spitzmesser who passed away September 29, 2011.
State Accident fund Post Office Box 102100 Columbia, South Carolina 29221 (803) 896-5800 http://www.saf.sc.gov/
South Carolina State Accident Fund “Protecting you since 1943.� 6