I’ve noticed that experience mods in Missouri have been swinging more wildly than expected recently.<\/p>\n
Much of this is due to the July 1, 2011 change by the NCCI where a 70% discount now applies to med-only claims, regardless of size.<\/p>\n
Prior to July 1, med-only claims went into the mod formula at 100% in Missouri. However, by law, Missouri employers were permitted to pay med-only claims under $1,000 out of their own pocket in order to keep them out of their mod.<\/p>\n
This change has pretty much defeated any advantage an employer gains from this (and it applies retroactively to all claims for mods effective after the July 1, 2011 date) so a lot of employers lost any benefit from their efforts in prior years.<\/p>\n
Meanwhile, some employers got a windfall. Med-only claims excess of $1,000 now enter the formula at on 30 cents on the dollar. I know one client that had several med-only claims in the $3,000 to $5,000 range. Their 2011 mod came in a full 8 points under the projection just due to this change.<\/p>\n
So, some insureds are being punished for following the intent of state law (RSMO 287.957 was written expressly<\/em> to benefit those employers who paid claims under $1,000 out of their own pocket). Meanwhile, other employers are reaping unexpected benefits that are saving them thousands in premium dollars.<\/p>\n","protected":false},"excerpt":{"rendered":" I’ve noticed that experience mods in Missouri have been swinging more wildly than expected recently. Much of this is due to the July 1, 2011 change by the NCCI where a 70% discount now applies to med-only claims, regardless of … Continue reading