Rating Viewings South Carolina Workers Comp News Item
South Carolina Workers Comp took a turn for the worse for adjusters trying to set permanency reserves on files.
On Friday, the South Carolina Industrial Commission decided to not go along with Governor Mark Sanford’s previous Order that the Industrial Commissioners decide permanency ratings based on the AMA guidelines. I did not think the Commissioners had that power as they were appointed by South Carolina’s governor.
One of the most expensive parts and the reason for the horrendous increases of Work Comp rates premiums is that there is no standard in that state when a viewing takes place to assess the permanent partial disability. You could put the same person in front of two different commissioners and get two totally different South Carolina impairment ratings. North Carolina, for instance, is much more objective with their permanency ratings.
It is now and has been almost impossible for a Workers Comp adjuster to set the reserves on the file, as the final permanency rating is a roll of the dice, at best. The permanency ratings are a large part of what E-Mods consist of in charging the South Carolina employers their premiums. To be safe, the adjuster must put up a very high reserve to forecast the permanency rating which is akin to forecasting the weather.
This is one of the most unfriendly-to-business decisions I have seen come from any state body in many years. When employers pull up stakes and move to neighboring states, then the legislature and other governing bodies will wonder why the tax base is shrinking. This has happened before in Maine, Massachusetts, California, and other states. When employers pick up their businesses and move them, an alarm will go off. Who is hearing the alarm now except Governor Sanford?
There is a saving grace. The case may move into the courts to be settled. This will likely be one that the South Carolina Supreme Court will need to examine. Between now and then, South Carolina businesses have had a total of a 50% increase in their premiums over the last two years. West Virginia’s motto is “Open for Business”. Is South Carolina’s “Going Out of Business?”
Next Up – A Review of the Workers Compensation environment in West Virginia
©J&L Risk Management Inc Copyright Notice