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OML MEMORANDUM ON BWC THIRD-PARTY ADMINISTRATOR CHANGE
April 26, 2018
On April 25th, the Ohio Municipal League selected a new Third-Party Administrator for the OML Workers Compensation Group rating program: CareWorksComp. Shortly thereafter, our prior Third-Party Administrator, CompManagement, issued a solicitation letter to current OML Workers Compensation members. This CompManagement solicitation letter, unfortunately, contains inaccurate and misleading information.
The Ohio Municipal League is your organization working diligently to secure the best value and service for its members since 1944. The OML currently represents 730 municipalities of which 643 are in the OML BWC Group Rating & Group Retro Programs. The Ohio Municipal League created the Ohio Municipal League Workers Compensation Group rating program under BWC guidelines to provide its members an opportunity to substantially reduce their workers' compensation premiums.
Per BWC guidelines, the OML selects the Third-Party Administrator to assist with the OML BWC Group Rating Program. As you might expect, OML is continually assessing and evaluating its vendors and those who its recommends for its members. CompManagement served as OML's BWC Third-Party Administrator for numerous years. Prior to that, the OML contracted with Gates McDonald to serve as Third-Party Administrator. After much review and analysis, OML has selected CareWorksComp as its new Third-Party Administrator. The current contract with CompManagement ends on September 30, 2018 however, OML has relieved CompManagment of most of its duties but is honoring any fees due CompManagment until the contract term ends.
Please note that the BWC allows only one Third-Party Administrator per Group rating program, and a Third-Party Administrator is not eligible to create a Group Rating Program on its own. Therefore, a decision by your municipality to make CompManagement as your Third-Party Administrator will necessitate your municipality moving to a different group rating program, or not be in a group rating program at all. The costs saving you receive by being in the OML Group Rating Program are significant and you may not be able to get the same cost savings elsewhere. You should check this out prior to withdrawing from the OML Group Rating Program. Finally, the Ohio Treasurers Association is a sub-group under the OML Group Rating Program, and therefore, currently the OML Third-Party Administrator is its Third-Party Administrator.
The OML did not make the change of Third-Party Administrator lightly. Responding to concerns of our members, the OML began contract negotiation with CompManagement in September of 2017. There were matters in the current contract that were not acceptable to the OML and customer service was an issue. These negotiations continued until early March of this year at which point the OML issued a final best offer to CompManagement which was rejected. CompManagement was told that if the final best offer was rejected, negotiation would begin in earnest for a new Third-Party Administrator. The OML wanted to buy-out the current CompManagement contract expiring on September 30, 2018, however, CompManagement declined. The OML notified CompManagement officially that its Third-Party Administrator has been changed on April 25th, the same day of the change, and prior to the CompManagement solicitation memo saying "[n]o direct notification from the OML was given to CompManagement".
The current OML/CompManagement contract has not been breached by the OML since the OML has exercised its right to pay CompManagement under the current contract until it expires but relieved them of any duties which will be performed by CareWorkComp at no additional cost.
CareWorksComp, Ohio's largest Third-Party Administrator has an excellent record of providing effective services to over 45,000 public and private clients and -twenty-one (21) group and group retrospective rating programs. CareWorksComp is owned by a national workers' compensation company, York Risk Services Group, who also manages the Public Entity Pool of Ohio (PEP) and Ohio Township Association Risk Management Authority (OTARMA). CareWorksComp has the talent, tools and resources to help our members solve problems, mitigate risk and lower the cost of workers' compensation, unemployment and human resources.
Your current discounts and refunds are NOT at risk. CompManagement's allegations are unfounded and are meant as a means to "scare" you in to thinking your premiums could increase because of the switch in Third-Party Administrators. This could not be further from the truth. CareWorksComp gained immediate access to all claims on April 25, 2018. The CareWorksComp team is reviewing your accounts to ensure all pending actions are completed as planned, all deadlines are met, and all scheduled hearings are attended.
Rest assured the OML is working in your best interest. If you have any question, please contact the OML offices.
Kent Scarrett
Executive Director
Garry E. Hunter
Legal Counsel
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