Current through all regulations passed and filed through September 16, 2024
(A) An AEO or a PEO registered with the
bureau of workers' compensation under rule
4123-17-15.2 of the
Administrative Code may apply to pay compensation directly as a self-insuring
employer.
(1) The
AEO or the PEO must meet all eligibility
criteria
set forth in section 4123.35 of the Revised Code.
(a) The AEO or the PEO
will
provide five years of financial records as set forth in division (B)(1)(e) of
section 4123.35 of the Revised Code. The
administrator
of workers' compensation cannot waive this
mandate.
(b) Worksite employees of an AEO and shared
employees of a PEO will be considered employees of the AEO or the PEO for the
purposes of meeting the
provisions of division (B)(1)(a) of section
4123.35 of the Revised Code only
if the following criteria are met:
(i)
An AEO will demonstrate to
the bureau that it is in compliance with all of the following:
(a) The duties of organization regarding
worksite employees set forth in section
4133.03 of the Revised Code, as
amplified in paragraph (D) of rule
4123-17-15 of the Administrative
Code;
(b) The
provisions of section
4133.07 of the Revised Code;
and
(c) The
provisions of section
4133.10 of the Revised Code, as
amplified by paragraphs (A)(3) and (A)(4) of rule
4123-17-15.1 of the
Administrative Code;
(ii)
A PEO
will demonstrate to the bureau that it is in compliance with all of the
following:
(a) The duties of organization
regarding shared employees set forth in section
4125.03 of the Revised Code, as
amplified by paragraphs (C) and (E) of rule
4123-17-15 of the Administrative
Code;
(b) The
provisions of section
4125.05 of the Revised Code;
and
(c) The
provisions of section
4125.07 of the Revised Code, as
amplified by paragraphs (A)(3) and (A)(4) of rule
4123-17-15.1 of the
Administrative Code.
(iii) Client employer wages.
(a) For an AEO, all of the client employer's
wages for worksite employees
are paid and reported under the tax
identification number of the client employer for federal tax reporting purposes
as stated in section 4133.03 of the Revised Code and
paragraph (D) of rule
4123-17-15 of the Administrative
Code.
(b) For a PEO, all of the
client employer's wages
are paid and reported under the tax
identification number of the PEO for federal tax reporting purposes.
(2) Any AEO
or PEO application for self-insured status will be referred to the self-insured
review panel pursuant to paragraph (F)(1) of rule
4123-19-14 of the Administrative
Code.
(3) Any application to add an
AEO or a PEO to an existing self-insured entity will be referred to the
self-insured review panel pursuant to paragraph (F)(1) of rule
4123-19-14 of the Administrative
Code.
(B) An AEO or PEO
granted the privilege of self-insured status must do all of the following:
(1)
If determined
necessary by the bureau, furnish security, in the amount, and in the form
of a letter of credit from a federally insured
financial institution or other security approved by the bureau, as
provided by paragraphs (F), (G), and (H) of rule
4123-19-03 of the Administrative
Code.
(a) The amount
of security
deemed necessary will be
as
determined by the bureau.
(b) The
AEO or the PEO is not permitted to use an assurance organization to meet its
security
obligations under this rule.
(c) The bureau may, pursuant to paragraph
(N) of
rule 4123-19-03 of the Administrative
Code,
demand the AEO or the PEO to furnish additional
security within thirty days of receiving the notice issued pursuant to this rule
.
(2) Submit to the bureau every two years, or
upon the bureau's request, an actuarial estimate of the unpaid loss and loss
adjustment expense liabilities of the AEO or the PEO performed by an
independent actuary with a fellow of the society of actuaries or casualty
actuary society credential.
(3)
Make contribution to the self-insuring employers' guaranty fund as set forth in
rule 4123-19-15 of the Administrative
Code. For purposes of this rule, the premium as reported on the total of the
last two full six-month semi-annual payroll reports
will include
the premium of the AEO or the PEO and all its client employers.
(4) Pay all assessments levied upon
self-insuring employers under rule
4123-17-32 of the Administrative
Code.
(5) Reimburse the bureau for
disabled workers' relief fund payments on claims for which the AEO or the PEO,
or its client employers are employer of record, pursuant to paragraph (B) of
rule 4123-17-29 of the Administrative
Code.
(6) Make a quarterly report
to the bureau that details the active clients, all claims, and the claim
reserves for each claim of the AEO or the PEO.
(C) For purposes of this rule, "paid
compensation" means all amounts paid by the AEO or the PEO and its client
employers for living maintenance benefits, all amounts for compensation paid
pursuant to sections 4121.63,
4121.67,
4123.56,
4123.57,
4123.58,
4123.59,
4123.60 and
4123.64 of the Revised Code, all
amounts paid as wages in lieu of such compensation, all amounts paid in lieu of
such compensation under a nonoccupational accident and sickness program fully
funded by the AEO or the PEO, or its client employers, and all amounts paid by
an AEO or a PEO and its client employers for a violation of a specific safety
standard pursuant to Section 35 of Article II, Ohio Constitution and section
4121.47 of the Revised Code. Any
reimbursement received from the surplus fund pursuant to section
4123.512 of the Revised Code by
the AEO or the PEO, or its client employers for any such payments or
compensation paid
is to be applied to reduce the amount of paid
compensation reported in the year in which the reimbursement is made. Any
amount recovered by the AEO or the PEO, or its client employers under section
4123.931 of the Revised Code and
any amount that is determined not to have been payable to a claimant in any
final administrative or judicial proceeding
will be
deducted, in the year collected, from the amount of paid compensation reported.
(1) For an AEO or a PEO that is a
self-insuring employer for which paragraph (I) of rule
4123-17-32 of the Administrative
Code is applicable, paid compensation includes any amounts paid by the state
insurance fund for claims directly attributable to the AEO or the PEO and any
client employers of the AEO or the PEO. In determining the applicability of
paragraph (I) of rule
4123-17-32 of the Administrative
Code to an AEO or a PEO, the bureau
will use the date on which the AEO or the PEO was
added to the self-insured policy if
such date is after the effective date of the self-insured
policy.
(2) If a client employer enters into a new
AEO agreement with an AEO, or a
new PEO agreement with a PEO, that is
self-insured risk which paragraph (I)
of rule 4123-17-32 of the Administrative
Code is applicable, paid compensation
includes any amounts paid by the
state insurance fund for claims directly attributable to that client
employer.
(D) An AEO or
a PEO granted the privilege of self-insured
status
cannot:
(1) Enter
into AEO agreements or PEO agreements to provide workers' compensation coverage
through the state insurance fund; or
(2) Enter into a partial-lease
agreement.
(E) An AEO or
a PEO granted the privilege of self-insured status shall do all of the
following:
(1) Prior to entering into an AEO
or a PEO agreement with a client employer, provide written notice to the client
employer that the submission of a lease termination notice form by the AEO or
the PEO to the administrator will require the AEO or the PEO to report all
information necessary for the administrator to develop a state fund experience
modification factor for each client employer involved in the lease
termination.
(2) The self-insured
AEO or the self-insured PEO
will
submit all
necessary information by the date set by the
administrator, and in a format determined by the administrator. This
information
is
to be submitted each year following the submission of a lease termination
notice form by the AEO or the PEO, for as many years as
deemed
necessary by the administrator to develop a state fund experience
modification factor for each client employer involved in the lease termination.
The self-insured AEO or the self-insured PEO may
have to submit additional information to the
administrator if the administrator determines that additional information is
needed to develop a state fund experience modification factor for each client
employer involved in the lease termination.
(3) A self-insured AEO or
a self-insured PEO that submits a lease
termination notice form to the administrator
will provide
the following information to the administrator within thirty calendar days from
the lease termination date for each client employer involved in the lease
termination:
(a) The payroll of each client
employer involved in the lease termination, organized by classification code
and policy year;
(b) The medical
and indemnity costs of each client employer involved in the lease termination,
organized by claim; and
(c) Any other information the administrator
may
need to develop a state fund experience modification
factor for each client employer involved in the lease termination.
(4) The administrator may revoke
or refuse to renew the privilege of operating as a self-insuring employer if an
AEO or a PEO fails to provide the information requested by the administrator
under this rule.
(F) The
administrator
will use the information provided under this rule to
develop a state fund experience modification factor for each client employer
involved in a lease termination with a self-insured AEO or
a self-insured PEO.
