Since the 2020 policy year wrapped, we’ve mentioned the lackluster performance of several Group Retro pools. These poor  returns, as well as a few assessments, are occurring largely in part to BWC’s move to the ACES reserves system, and aren’t necessarily tied to the performance of any one TPA. Luckily, Spooner’s pools remain steady (this is the good), but they may not be the returns we’ve seen in years past.

On July 28, we received what will be the final numbers used to calculate the first round of Group Retro returns for those enrolled during the2020-2021 policy year. Out of 53 groups across all industries, only five performed above the 40% mark. This is increasingly important to remember as you shop 2023-24 programs this summer, and you’re seeing 50-60% returns being promised. The remainder lingered between 10-38% (the bad), with a few more in the red – meaning employers in those pools will be assessed, i.e. billed for their share of the difference (the ugly). Many decision makers don’t make note of the “maximum assessment” when they complete their Group Retro paperwork. This is a percentage disclosed that equates to how much of that year’s premium you’ll be responsible to pay back to Ohio BWC if the performance of your Group Retro pool is worse than expected.

Here’s a real-life example of one of the groups being assessed. This particular pool was assigned a 20% maximum assessment, with a year 1 performance of -9.04%. Employers in this pool will be billed by BWC for 9.04% of their 2020 premiums. Hypothetically, let’s say the performance came in at -24%. Those employers would owe a maximum of 20% of 2020 premiums back to BWC.

Of the six Group Retro pools being assessed, three were in the manufacturing industry and the remaining three in the transportation, construction and extraction industries. 

Keep in mind that BWC also chose to withhold 2018 and 2019 Group Retro refunds. Many employers are used to “stacking checks” every fall, when they receive 1^st, 2^nd and 3^rd year Retro refunds from the last three policy years, respectively. Unfortunately, those employers will receive no checks from BWC this fall (and some of them will receive an extra invoice, to add insult to injury). BWC is losing money at a rapid clip, so there won’t be another dividend (Billion Back) rebate this year to cushion the blow of no Retro returns.

If you have questions or concerns about the performance of your Group Retro pool for the 2020 policy year, don’t hesitate to reach out to our team at 440-249-5203 or bdavis@spoonerinc.com.