West Virginia State Firemen's Association

WV Auditor Gainer and WVSFA 3VP John Holstein Deliver Workers Comp Reimbursement Check to Madison VFD

3-21-2012

West Virginia State Auditor Glen Gainer III delivered the reimbursement check for the offset amount of $5,548.00 to the Madison Volunteer Fire Department. Through the efforts of our Legislature, the Governor’s Office and The West Virginia State Firemen’s Association, legislation was passed in the 2011 Session of the West Virginia State Legislature and a matching amount of money was acquired from the Governor’s office to offset the huge increase in worker’s compensation coverage that was expected to take place during fiscal year 2011 and 2012. Five million dollars was acquired through these sources to help offset the rising costs associated with workers compensation coverage.

Most of our State’s volunteer fire departments saw increases to the tune of 300%-400% and some are expected to rise to even higher rates. There’s many factors involved in these rate increases, some of the factors involve call volume, the number of emergency medical service calls the departments responded to and of course, an increase in the amount of wages formulated in the new workers comp plan and of course the overall risk liability seen by insurers.

Currently, approximately 1.7 million dollars have been delivered to two-thirds of the State VFDs for workers comp payments. The VFDs pay the full amount then submit their statements to the Auditor’s office for review. Based on previous worker’s comp premiums, the reimbursement amount is calculated above the previous amount. Once the Auditor’s office receives the statements and payment is authorized, it takes no more than 48 hours (24 optimally from start to finish) for the Auditor’s office to send out the reimbursement.

Within the coming months during Interim meetings at the Legislature, a permanent solution must be put in place to establish an income method to offset these worker’s comp increases. With appx. 421 volunteer fire departments in the state, covering 80%+ of the area and 70% of the population, there’s many that rely heavily on a minimal amount of money received from the insurance sur-charge. This money, divided evenly between all fire departments in the state, volunteer and paid departments alike, totals appx. $44,000 per department, per-year. With the rising costs of equipment and insurance alone, this isn’t enough to sustain many departments within the state as this money is the only guaranteed source of income for various departments across the state. Insurance alone, at a majority of volunteer fire departments exceeds $10,000 per year with some as high as $30,000 per year. Rising fuel costs, increased mandates for equipment replacement and safety guidelines set forth by various government and service agencies, place the operating budget of most departments well outside the limits of the meager $44,000 state fund.

Photo by John Holstein

State Capitol – West Virginia State Auditor Glenn Gainer III was on hand during Firefighter Day at the West Virginia State Capitol Complex to personally hand-deliver several worker’s compensation reimbursement checks to several departments in the State. Capt. Chasity Gregory of the Alum Creek Volunteer Fire Department was on hand to accept the check for her department. Auditor Gainer stated “…there’s still approximately three and half million of the 5 million million dollars acquired during last year’s Legislative session. We still have many departments left to reimburse and we’ll need to acquire funding in the future.”

Through the help of the Auditor’s office, a streamlined process has been developed to receive, enter and return reimbursements in an efficient manner. Mr. Gainer stated that their office attempts to get each and every reimbursement check out within 24 hours of initial receipt.

The West Virginia State Auditors Office was empowered by the West Virginia Legislature in
2011 to implement and administer H.B. 3271 (The Volunteer Fire Department Workers’
Compensation Premium Subsidy Program). The Auditor assembled a cross functional work
team made up of representatives from his office, the Office of the State Insurance
Commissioner, the National Council on Compensation Insurance, Inc., and the WV State Fire
Marshal. This team developed:

~ Administrative parameters
1 Data processing requirements

1 Communication strategy

The team completed the development in June 2011 with the launch of a new page on the State
Auditor’s website, which provided the information and requisite documentation to assist
volunteer fire departments in acquiring Workers’ Compensation Premium Subsidy. Subsidy
requests began to arrive in early July 2011.

To date, ofthe 416 state volunteer fire departments, 288 have applied for the subsidy. Of that
group, 264 have been processed (the difference being work-in-process). Subsidy payments
currently total $1,267,139.05. The average payout has been $4,399.79.

All payments described are based on Initial Estimated Premiums. The actual Workers’
Compensation Premium for an individual volunteer fire department will not be known until the
tinal audit is completed (estimated at 15 months after the initial date ofthe policy). The result of
the final audit can result in another payment due to the carrier or a refund to the volunteer fire
department dependent on the actual number of hours worked by those individuals within the
771 ‘l class code (fireñghterldriver).

Download the PDF Document

As we have stated repeatedly over the course of the last year, Brickstreet will no longer be offering a renewal or new Worker’s Compensation policies to volunteer fire departments as of July 1 2011.

In a recent email conversation, it was determined that we need a list of providers that will be offering worker’s comp coverage. Here is the list and an explanation on how you will find coverage:

There are three (3) companies that will be offering Worker’s Compensation coverages under the new plan…Brickstreet is not one of the three (3)…

The three (3) are:

• Traveler’s
• American Mine
• Liberty Mutual

Basically, your fire department will not have a choice – you will go into an assigned risk pool and whichever company is up next in the rotation will get your business – kind of an, “eenie, meenie, minie, moe” type deal.  All of these are good companies.  You can still purchase your plan through your agent of record but that agent will have to send it through the assigned risk pool and you will get whatever company is up to bat at the time.  Premiums, from what I have been told, have risen anywhere from 300 to 700%…reimbursement from the pool timelines are still unknown.  Your department will have to pay your full yearly premium up front and then wait to be reimbursed by the state after you submit your copy of a paid invoice and a copy of your paid invoice from last year – you will be reimbursed the difference…supposedly…but this means that your department will have to float the state…

There is also the issue that, if your fire department runs EMS (First Responder, ALS, BLS, etc.), your EMS related man hours and their related premium(s) are not eligible for the premium subsidy – YES, it was not in the legislation BUT the Legislative Auditor’s Office worked that in…is it right?, NO, but until someone challenges it, it is what they are going by.  Not only does this create an accounting headache for fire departments it creates a dilemma where many fire departments are talking about not running EMS and not assisting EMS as those hours will be disallowed from receiving the premium subsidy reimbursement.

Thomas Miller