Risk-Tex, Volume 5, Issue 4, July 2002 Page: 6
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Workgroup studies program formula
(Continued from page 5)
it would be to design a program and
use a formula which would be uni-
versally acceptable to agencies.
SORM formed an inter-agency
workgroup to assist and comment on
the design of the current assessment
plan. The workgroup consisted of
representatives from a diverse group
of agencies and universities, who all
had the opportunity to shape and
comment on the rules of the pro-
gram. The program allocated the
costs of workers' compensation
among agencies based on payroll,
injury frequency rate, and historical
claims costs.
Over the past eight months,
SORM staff has met with many of
the covered agencies to explain the
assessment program and to address
each agency's concerns. As you
would expect, agencies' concerns are
as unique and varied as their func-
tion and funding. Many of the issues
were anticipated in the drafting of
the program and solutions were
sought. While we have been able to
address most of the concerns, some
of the problems that have been iden-
tified by agencies are literally
beyond the authority of SORM to
resolve.
A number of agencies are facing
significant financial impacts to theirnon-general-revenue funding
sources, and we empathize with
these agencies. Unfortunately, the
ability to subsidize these programs is
not within SORM's authority. A
major difference in HB 2976 is that
rather than relying on self-reporting
by the covered agency, the new pro-
gram has covered agencies pay their
assessment in proportion to their
payroll by funding source up front.
Another major difference is that,
because of the statewide financial
benefits of risk pooling, many agen-
cies have assessments in excess of
their average annual costs.
Another issue surrounding the
assessment program seems to stem
from the basic intent of the program
and its formula. Many agencies
believe that an individual agency's
assessment should be more closely
tied to those claims payments made
on behalf of that agency. Finding the
correct balance in the formula will
require continuing input from agen-
cies that are engaged in the process.
To address that issue, SORM has
created another workgroup to study
the Risk/Reward Program and
assessment formula. We have sched-
uled several meetings within the
coming months. If your agency has
not signed up to participate, we
encourage you to do so by contactingme at lucinda.saxon@sorm.state.tx.
us or (512) 936-1452.
The goal of the Risk/Reward
Program is to provide agencies with
an incentive to reduce injuries to
state workers. In addition, this pro-
gram offers a number of significant
advantages over the former system
of agencies paying "their 25 per-
cent." The assessment process will:
give agencies greater control over
their budgets by making their work-
ers' compensation costs more pre-
dictable through assessments; cush-
ion the effects of catastrophic losses
on individual state agencies by pool-
ing risks; and, provide agencies with
compelling incentives to promote
office-place safety and reduce
claims.
SORM and the Legislature con-
tinue to believe that the Risk/Reward
Program of HB 2976 represents our
best hope to protect the men and
women who dedicate themselves to
public service, and to reduce the
costs of the workplace injuries to the
State. We look forward to working
with each agency as we proceed
down the path of workplace safety.
Lucinda Saxon is in charge of
Governmental Relations in SORM's
General Counsel's office.Please let us know if you would like to con- Q Yes, I would like to continue receiving a
tinue receiving RISK*TEX. Fax your copy of RISK*TEX.
responses to: 512-472-4769.
Name: Q No, I no longer wish to receive a copy of
Agency: RISK*TEX.
Mailing Address:
E-mail Address:6 RISK*TEX Volume V, Issue 4
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Texas. State Office of Risk Management. Risk-Tex, Volume 5, Issue 4, July 2002, periodical, July 2002; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth1582264/m1/6/: accessed July 17, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu.; crediting UNT Libraries Government Documents Department.