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Premium Modification Systems Delays: A Plan to Implement Experience Rating and the Net Rate Transition Rules
99/09/21-02
THE WORKERS' COMPENSATION BOARD OF BRITISH COLUMBIA
RESOLUTION OF THE PANEL OF ADMINISTRATORS
Re: Premium Modification Systems Delays: A Plan to Implement Experience Rating and the Net Rate Transition Rules
WHEREAS:
Pursuant to Section 82 of the Workers Compensation Act, RSBC 1996, Chapter 492 and amendments thereto (the "Act"), the Panel of Administrators (the "Panel") must approve and superintend the policies and direction of the Workers’ Compensation Board (the "Board") and must:
| 82(a)(ii) | review and approve operating policies of the Board, | |
| 82(a)(iv) | develop policies to ensure adequate funding of the accident fund, | |
| 82(a)(v) | approve major programs and expenditures, | |
| 82(a)(vi) | plan for the future of the Board, |
AND WHEREAS:
The Panel has approved a new experience rating plan effective January 1, 2000;
AND WHEREAS:
The Finance Division of the Board is unable to meet its January 1, 2000 timetable for the introduction of the new Experience Rating Plan;
AND WHEREAS:
The 2000 final assessment rate for employers will not be fully known until the new experience rating system is introduced in mid-year 2000;
AND WHEREAS:
A provisional rate for the first and possibly second quarter payments will be required;
THE PANEL OF ADMINISTRATORS RESOLVE THAT:
The Year 2000 Assessment Rates will be determined according to the plan outlined in the attached document entitled "Provisional Net Rates for 2000".
DATED at Richmond, British Columbia, October 13, 1999.
| By the Workers' Compensation Board |
|
| DON COTT, CHAIR PANEL OF ADMINISTRATORS |
PROVISIONAL NET RATES FOR 2000
Glossary of Terms:
| Base Rate: |
The rate for the Rate Group or Classification Unit published in the Classification and Rate List |
|
Experience Rating: |
The surcharge or discount which adjusts the base rate for a firm according to the Experience Rating Plan |
|
Target Rate: |
Base Rate adjusted by Experience Rating for a firm |
|
Provisional Target Rate: |
Target Rate calculated on a provisional basis for the first part of 2000 |
|
Net Rate:
|
The rate a firm is charged (including capping of the Target Rate as a result of a transition plan) |
| Provisional Net Rate: | Net Rate calculated on a provisional basis for the first part of 2000 |
The Provisional Target Rate for 2000 will be determined as follows:
- where a firm did not qualify for an Experience Rating for 1999, the Provisional Target Rate for 2000 will be the Base Rate for 2000;
- where a firm had a surcharge Experience Rating for 1999, the Provisional Target Rate for 2000 will be the Base Rate for 2000;
- where a firm had a maximum discount Experience Rating for 1999 (i.e. 8.3%, 16.7% and 33.3%), the Provisional Target Rate for 2000 will be the Base Rate for 2000 adjusted by the 1999 Experience Rating discount;
- where a firm had a discount Experience Rating for 1999 of an amount less than the maximum discount, the provisional Target Rate for 2000 will be the Base Rate for 2000 adjusted by a 10% discount.
The Provisional Net Rate for 2000 will be determined as follows:
- the Provisional Net Rate for 2000 will be the Provisional Target Rate for 2000 capped according to the Transition Rules for 2000 (as outlined in resolution #990824-04).
Implementation Procedure:
- firms will be advised of a Provisional Net Rate for 2000 in the fall of 1999;
- firms that are required to remit quarterly will be required to remit based on the Provisional Net Rate until the final Net Rate for 2000 is advised in mid-2000;
- the total annual remittance for 2000 will be required based on the final Net Rate for 2000;
- firms registered on or after January 1, 2000 will be assessed the Base Rate for 2000 (unless the Transfer of Experience Rating policy applies to that firm).