§ 27-14-201 — Rates and classifications; rate surcharge

(a) The worker's compensation program shall be neither
more nor less than self-supporting. Employments affected by
this act shall be divided by the division into classes, whose
rates may be readjusted annually as the division actuarially
determines. Any employer may contest his classification as
determined by the division following the contested case
provisions of the Wyoming Administrative Procedure Act except
that the division shall carry the burden of proving that the
classification is correct. Information shall be kept of the
amounts collected and expended in each class for actuarially
determining rates, but for payment of compensation, the worker's
compensation account shall be one and indivisible.
(b) If it is determined at any time and in any manner that
a determination by the division of an industrial or employment
classification is incorrect, premiums under any corrected
classification shall be charged only from the date of change in
classification. This subsection shall not apply to any
employer's categorization of an employee's gross earnings to an
industrial or employment classification.
(c) Upon compliance with the rate making provisions of the
Wyoming Administrative Procedure Act and written approval by the
governor, the division shall determine the hazards of the
different classes of employments and fix the premiums therefor
at the lowest rate consistent with maintenance of an actuarially
sound worker's compensation account and the creation of
actuarially sound surplus and reserves, and for such purpose
shall adopt a system of rating in such a manner as to take
account of the peculiar hazard of each risk, mathematically and
equally based on actual costs to the program in terms of number
and extent of injuries and deaths, and shall use consultants or
rating organizations as it determines necessary. The department
shall submit an annual report with respect to proposed annual
rate adjustments under this section to the joint labor, health
and social services interim committee no later than October 1 of
the year preceding the implementation of the rate adjustment.
The total annual rate adjustment for any employment
classification under this section is subject to the following
limitations:
(i) Repealed by Laws 1994, ch. 86, § 3.
(ii) Repealed by Laws 1994, ch. 86, § 3.
(iii) Repealed By Laws 1998, ch. 117, § 2.
(iv) Repealed By Laws 1998, ch. 117, § 2.
(v) For the calendar year commencing January 1, 1999
and each calendar year thereafter, any increase in the base rate
for each employment classification shall not exceed fifty
percent (50%) of the base rate imposed for that employment
classification during the immediately preceding year;
(vi) To compensate for the difference between
revenues generated under base rate adjustment limitations
imposed under paragraph (c)(v) of this section and revenues
which would have been generated if base rates had been adjusted
without limitations, the division may limit base rate decreases
for any employment classification by not more than fifty percent
(50%) of the actuarially determined decrease;
(vii) Repealed By Laws 1998, ch. 117, § 2.
(viii) In determining rates under this section for
employers specified under W.S. 27-14-108(a)(ii)(G)(I), the
division shall base the rates on one (1) rate classification for
sales personnel and one (1) rate classification for all other
personnel other than clerical;
(ix) Notwithstanding paragraph (v) of this
subsection, for the calendar year beginning January 1, 2003,
rates shall be adjusted to reflect the reclassification of
industry codes in accordance with the North American Industry
Classification System (NAICS) manual, but in no case shall the
base premium rate for any classification for the calendar year
beginning January 1, 2003 exceed one hundred fifty percent
(150%) of the lowest base rate assigned to any employer in that
classification under the standard industrial classification
manual for the preceding year.
(d) In addition, the plan of rating shall use an
experience rating system based on three (3) years claim
experience, or as much thereof as is available, for employers
enrolled under it. This system shall reward employers with a
better than average claim experience, penalize employers with a
worse than average claim experience and may provide for premium
volume discount so long as the account remains actuarially
sound. Discounts from or penalties added to base employment
classification rates because of claim experience shall not
exceed sixty-five percent (65%) for rates through calendar year
2016 and shall not exceed eighty-five percent (85%) for rates
beginning with calendar year 2017. An employer who is current on
premium payments required by this act may apply to the division
for a determination of experience modification rating
chargeability for an injury to the employer's employee. The
division's determination of chargeability shall be reviewable as
provided in W.S. 27-14-601(k)(iii) and (iv). If the division,
by a preponderance of the evidence, determines that an
employee's injury was primarily caused by a third party, the
injury shall not be charged to the employer's account. The
employer shall bear the burden of proof in any action brought by
the employer for a chargeability determination. If an
employer's account is determined to be unchargeable under this
subsection, the employer's account shall not be further credited
upon recovery from a third party by the division. The division
shall by rule and regulation establish necessary procedures for
a determination of chargeability. Any determination by the
division regarding causation of an injury pursuant to this
subsection shall be used only for ratemaking purposes and shall
not be admissible in any civil litigation regarding the injury.
(e) The division in fixing rates shall provide for the
costs of benefits and the expenses of administering the worker's
compensation account allowed by law, subject to the following:
(i) The account shall be one (1) account but shall
include provision for all expenses allowed by this act, loss
adjustment expenses and unpaid losses, including:
(A) Case reserves;
(B) Future development on known claims;
(C) Reopened claims reserve;
(D) Claims incurred but not reported;
(E) Claims incurred and reported but not yet
recorded;
(F) An actuarially reasonable provision for
adverse deviation to reflect the uncertainty inherent in
estimates of unpaid losses and loss adjustment expenses.
(ii) The account shall be fully reserved on or before
December 31, 2013;
(iii) The division shall annually obtain a report
from a qualified actuary rendering an opinion regarding the
reasonableness of the booked loss and loss adjustment expense
reserve and carried contingency reserve;
(iv) The division shall provide the opinion required
by paragraph (iii) of this subsection to the joint labor, health
and social services interim committee, or its successor, by
November 1 of each year;
(v) For purposes of calculating reserves, future
liabilities shall be discounted to present value using a
discount factor selected by the division. The discount factor
selected by the division and the reason for its selection shall
be included in the annual report to the joint labor, health and
social services interim committee or its successor;
(vi) The collection through premiums of any
deficiency in reserves and surpluses that exceeds five percent
(5%) of the fund balance shall be averaged over a ten (10) year
period;
(vii) For purposes of this section:
(A) "Fully reserved" means that the workers'
compensation account established by W.S. 27-14-701 has, in the
opinion of a qualified actuary, funds sufficient on a discounted
basis to provide for all unpaid loss and loss adjustment
expenses as well as an actuarially reasonable provision for
adverse deviation;
(B) "Qualified actuary" means a person who is a
fellow of the Casualty Actuarial Society or who has been
approved as qualified for signing casualty loss reserve opinions
by the Casualty Practice Council of the American Academy of
Actuaries.
(viii) Investment earnings from the investment of the
amount held as the actuarially reasonable provision for adverse
deviation shall be considered revenue to the worker's
compensation account as provided in this paragraph. The annual
amount of investment earnings available for consideration as
revenue under this paragraph shall be determined by the
department in an amount equal to not less than zero percent (0%)
and not more than five percent (5%) of the previous five (5)
year average market value of the amount held as the actuarially
reasonable provision for adverse deviation, calculated from the
first day of the fiscal year.
(f) The division is given full power and authority to
annually determine premium rates and classifications according
to the standards set forth under subsections (b), (c) and (d) of
this section provided that no change in the classification or
rates prescribed shall be effective until thirty (30) days after
the date of the order making the change.
(g) Policies or statements of coverage may be issued to
each covered employer. The division shall collect all costs in
certifying coverage under this act from the person requesting
the certification except for one (1) policy or statement of
coverage which may be issued to the employer at no charge.
(h) Approximate rates applicable to each employer pursuant
to this section shall be annually provided to the employer by
October 1.
(j) All data and formulas used by the division, including
the employment classification base rate and claim experience
rating, to determine rates for an employer shall be made
available to the employer upon request of the employer.
(k) Repealed by Laws 1989, ch. 149, § 3, 1994, ch. 86, §
3.
(m) Repealed by Laws 1987, ch. 94, § 2.
(n) Repealed By Laws 1998, ch. 117, § 2.
(o) The division shall in accordance with its rules and
regulations, grant a discount to rates established under this
section in an amount not to exceed ten percent (10%) of the base
rate for the employment classification of any employer if the
employer complies with a safety program approved by the division
and a discount in an amount not to exceed ten percent (10%) of
the base rate for the employment classification if the employer
complies with a drug and alcohol testing program approved by the
division and a discount in an amount not to exceed ten percent
(10%) of the base rate for the employment classification if the
employer complies with a health and safety consultation program
developed by the department of workforce services in
consultation with the occupational health and safety commission.
In no instance shall the sum total of discounts under this
subsection exceed thirty percent (30%) of the base rate for the
employment classification for the employer. The discount for
the health and safety consultation program shall only remain in
effect for three (3) years after the employer is certified to be
in compliance with the health and safety consultation program
recommendations. In determining safety program approval, drug
and alcohol program approval, health and safety consultation
program approval and the total discount granted under this
subsection, the division shall consider:
(i) The probability the program will reduce the
number of accidents and the probable savings which may be
realized from the reduction;
(ii) Relevant experience, if any, depicting actual
reduction in accidents and actual savings which is compared to
an industry standard;
(iii) The adequacy and accuracy of determining
participation in the program and the eligibility for a discount
by individual employers;
(iv) The administrative costs incurred by the
division in implementing a rate discount for an applicable
employment classification;
(v) Whether the employer adopts and enforces policies
establishing a drug-free workplace which may include an employee
assistance program to assist employees with alcohol or other
drug problems. The division shall follow rules adopted by the
department of workforce services in consultation with the
department of health for the effective implementation of this
paragraph. Rules adopted pursuant to this paragraph shall not
impose on any employer the requirement to pay the costs of
treatment or any other intervention. Employers enrolled in a
safety discount program under this paragraph shall have one (1)
year from the effective date of those rules within which to come
into compliance.
(p) Repealed By Laws 1998, ch. 117, § 2.
(q) The division may, in accordance with its rules and
regulations, grant a premium credit to rates established under
this section if it is determined by a qualified actuary retained
by the division that the fund will remain fully reserved after
the premium credit is granted and implemented. If the division
determines to grant a premium credit, the percentage of credit
allowed for the rate year shall be the same for all employers
qualified pursuant to paragraph (iii) of this subsection. The
following provisions shall also apply to the premium credit
program:
(i) The premium credit can only be used to offset
premiums, and in no case can the premium be redeemed by an
employer for cash;
(ii) Any premium credits shall expire as provided by
law. If no law provides for the expiration of credits, credits
shall expire as determined by the division;
(iii) The premium credit, if granted, shall only be
given to those employers who paid premiums during the preceding
year and whose accounts are current on all amounts owed under
the act, including premiums, case cost liability and penalties.
(r) In an industrial classification with less than twelve
(12) employers in which a single employer contributes greater
than fifty percent (50%) of the total premium in that
classification, the director of the department of workforce
services, with the concurrence of the governor, may adjust the
base rate for the employer established pursuant to this section,
not to exceed twenty-five percent (25%) subject to the
following:
(i) An affected employer submits a written
application to the division in the format prescribed by the
division after October 1 and before December 31 of the year
preceding the year in which the adjustment will be made;
(ii) The affected employer's experience modification
rating is lower than the average for the employer's industrial
classification;
(iii) The director determines that the employer has
been adversely affected due to the distribution of premiums
within the industrial classification; and
(iv) The employer is contributing less than twenty-
five percent (25%) of the total premium of the industrial
classification.
(s) Any loss of premium due to an adjustment pursuant to
subsection (r) of this section shall be distributed among all
rate classes in the annual base rate adjustment in the year
subsequent to the year in which the adjustment was made.
(t) The division may, in accordance with its rules and
regulations, create and implement a premium deductible program.
The following provisions shall apply to the premium deductible
program:
(i) Participating employers shall sign a contract
with the division, clearly identifying the terms of the program;
(ii) Participating employers shall be assigned a
reduced industry base rate for premium calculation purposes. The
industry base rate reduction shall be determined in a manner
that reflects the dollar amount of the deductible and is
consistent with an actuarially sound workers’ compensation
account;
(iii) Participating employers shall be financially
stable and in good standing with the division;
(iv) Participating employers shall report all work
injuries within the timeframes specified in W.S. 27-14-506;
(v) Participating employers failing to meet the
requirements of the premium deductible program shall have their
premium base rate reinstated at the full industry base rate,
retroactive to the reporting period in which the employer first
became noncompliant. Employers whose premium base rate is
reinstated at the full industry base rate under this paragraph
shall not be re-eligible for the premium deductible program for
a minimum of eight (8) calendar quarters;
(vi) Participation in the premium deductible program
cannot be transferred to a successor employer nor can it be
incorporated as part of a merger among employing units.
(u) No compensable injury related to COVID-19 that occurs
during the period beginning January 1, 2020 and ending March 31,
2022 for which coverage is provided under this act and for which
a claim was filed on or before March 31, 2023 shall be
chargeable to an employer's experience rating under this
section.