BWC should stick with plan on rebates

Tens of thousands of employers in Ohio may be sharing in a windfall of nearly $1.9 billion from state government. While about half of that is an initiative by Gov. John Kasich’s administration, the remainder may be coming courtesy of a judge.

Officials managing investments for the Ohio Bureau of Workers’ Compensation have done very well during the past few years. Net assets for the agency have ballooned to about $8.3 billion.

Because the bureau’s investments are providing much more money than needed to pay workers injured on the job at the about 210,000 employers covered by insurance through the agency, the Kasich administration wants to give some of it back.

Members of the bureau’s board of directors are to meet May 30 to discuss a proposal to pay about $1 billion in rebates to covered businesses, local governments and school systems.

Even as they discuss that proposal, board members will be facing an entirely different proposal to give money back to employers the agency covers, however.

In March, a Cuyahoga County judge ruled against the bureau in a lawsuit involving about 264,000 employers. The employers contend the board has charged them too much – $859 million – during the past eight years.

Judge Richard McMonagle agrees with the plaintiffs. He has ordered the state to make restitution.

Bureau attorneys have vowed to appeal the judge’s decision.

As matters stand, however, that leaves the board in the position of wondering whether, if it loses the appeal, it can afford to distribute the $1 billion in rebates envisioned by Kasich.

Board members should go ahead with the rebate plan.

It appears that even if the bureau loses its appeal over the $859 million, its resources still will be adequate to pursue the $1 billion rebate plan.

The bureau’s function is to provide workers’ compensation insurance at the lowest cost possible for participating employers. Unanticipated investment successes, then, represent good fortune in which employers should share.