Workers Comp Classification Codes
This question on Workers Comp Classification Codes was phoned into our offices last week due to the prior post on Classification Codes. One of the blog readers asked where to find the manual or website that contains all of the Workers Comp Class Codes.
The employer had received a workers comp audit and subsequent billing recently. The employer did not notice they had new classification codes on their policy and at time of audit.
The one main determinant is what states or states are covered by the policy. There are many independent rating bureaus that have their own classification codes manual such as California or Ohio.
The NCCI out of Boca Raton, FL covers most of the individual states and covers virtually all of the interstate (multistate) ratings including classification codes.
The Scopes Manual is produced by NCCI. This is the manual which contains all of the workers comp classification codes. However, referencing the manual and attempting any type of dispute comes with a Goliath caveat.
We receive a large number of emails and calls from employers that have decided to DIY on this subject. The employer has often referenced some type of classification manual and disputed the classification codes.
The carrier accepted the codes which actually increased their earned premium over what was contained in the audit billing.
One has to also be very careful when attempting to switch class codes if your company has a very high Mod (E-Mod or X-Mod). This is one of the most frequent ways to actually end up paying more premium.
If your company has a high Mod and then changes workers comp class codes to less risky ones, your Mod may increase enough to offset any type of refund that you would be owed and even result in a higher bill.
We usually receive the phone call after the Classification Codes have been reassigned and the Mod has spiked. There is not much we can do at that point.
Recalculating (re-promulgating) the Mod should be part of the dispute process.
The increased Mod is the result of the intricacies of the rating and Mod formulas. For the most part, Mods and class codes have an inverse relationship of sorts.
There are many articles in this blog concerning the premium dispute process. Feel free to use them to aid your company in researching the workers comp class codes.
This post was not meant to discourage any employer that has questions on their policy and audit to find out the correct answers or to dispute any audit.
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