Very Serious Upcoming Changes in Workers’ Compensation

If your company has no claims, the E-Mods/X-Mods will not change significantly. If you have more than one or two claims, it will change dramatically. This is going to change the rules on how companies like ours conduct Premium Employer Audit reviews. The way it is being done now will be a thing of the past.

What area will employers, businesses, and consultants need to be well versed in to be able to perform accurate Workers’ Compensation premium audits for employers? The answer to this question was found by reading the statistical study used as the basis for the change. It was buried deep in the study.

Consultants who are strong in that area and have been doing very similar reviews for many years are very lucky. You heard it here first.

The structure for performing premium audits and E-Mod/X-Mod reviews will change on October 1st. All rating offices will be changing the way they calculate E-Mods, including California. As I’ve said, there are some important components of claims that will need to be looked at more closely after the new changes.

Without getting too technical, claims review history will now be needed to fully understand how companies’ E-Mods/X-Mods are calculated. E-Mod/X-Mod spreadsheets will even look different. Unfortunately, the formula for calculating E-Mods/X-Mods will now be more complicated. The new rules will add multiple columns of claim information where previously there was only an injury code, a state code, and the total amount incurred.

A review of the losing streak is now even more important. Online access to your claims information will now be even more critical. Having inaccurate claim information will be very costly.