COVID-19 Changes to Uniform Stat Reporting & Experience Rating Plans

This week, Insurance Commissioner Lara approved amendments to the California Workers’ Compensation Uniform Statistical Reporting Plan—1995 (USRP) and Experience Rating Plan (ERP), designed to address the COVID-19 pandemic.  The amendments, proposed by the Workers’ Compensation Insurance Rating Bureau (WCIRB), do the following:

• Exclude costs of COVID-19 claims with dates of injury on or after 12/1/19 from an employer’s experience rate calculation, as the WCIRB notes such claims are unlikely to be a strong predictor of that employer’s future workers’ compensation claim costs.
• Exclude from covered payroll any employer payments to employees who remained on staff but performed no activities. This rule will remain in effect for the duration of the statewide stay-at-home order and for up to 30 days after it is lifted for employees who continue not to work.
• Allow employers to temporarily assign Classification Code 8810, clerical office employee to employees whose work shifted to clerical tasks during the stay-at-home order. The rule will apply for the duration of the stay-at-home order and for up to 60 days after it is lifted for workers who continue to meet the definition of clerical office employee.

The Department of Insurance issued a press release yesterday to announce approval of the amendments, noting that “These new regulations will mandate insurance companies recompute premium charges for policyholders to reflect reduced risk of loss consistent with Commissioner Lara’s April 13 and May 15 bulletins, and will result in savings for many policyholders as businesses continue to struggle financially during the COVID-19 pandemic.”

The press release further noted that “This new regulation will also exclude claims related to a COVID-19 diagnosis from being included in future rate calculations so that employers are not penalized with higher rates due to COVID-19 claims.  Insurers will also be required to report injuries involving a diagnosis of COVID-19 which will allow the Commissioner’s statistical agent—the WCIRB—to keep track of COVID-19 injuries, and will aid in the WCIRB’s future analyses of the workplace and market impacts.”  The amended regulations take effect July 1. 

Now that the amendments have been approved, the WCIRB is updating both the USRP and ERP.  Once completed, the Bureau will post the revised versions in the Filings and Plans section of its website.  In the meantime, the WCIRB has prepared a July 1, 2020 USRP and ERP Changes Quick Reference Guide, summarizing the changes and prepared three short videos explaining the amendments:

• Claims Reporting and Experience Rating
• Temporary Assignments to Classification 8810, Clerical Office Employees
• Exclusion of Payments to Non-working Employees

A copy of the commissioner’s order is here.

BY/