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HomeMy WebLinkAboutMMIA May 2000 NewsletterMMIA Newsletter May 2000 Spring Issue 1 3 4 6 INSIDE THIS ISSUE MMIA AT A GLANCE WC AUDITS WC ACCIDENT REPORTING CAN LIABILITY BE FUN WC WAGE LOSS BENEFITS THE MMIA AT A GLANCE By Bob Worthington, CEO The millennium brought a number of changes for the MMIA. I thought this would be a good time ~o bring everyone up-to-date on ail the activity. Claims Handling Last July, the MMIA established a department to adjust claims. This negated the need to centmct for claims administration. As we developed the MMIA claims operation, we were fortunate in that the individuals who were handling your claims elected to come to work for the MMIA. Owen Voigt assumed the position of Liability/Property Claims Manager, and Paula Vidrine became the Workers' Compensation Claims Manager. Specialized software, to manage the claim information, was purchased and space to house the operation was rented. Welcome Nathan Tubergen - MMIA Controller With development of an in-house claims administration department, the operational needs of the MMIA have changed substantially. With these changes came the need for enhanced financial management. The Board of Directors authorized creation of a Controller position on a half-time basis. The MMIA advertised the position. We received a significant number of applications, with several having excellent experience in governmental accounting. continued on page 2 Now that we have some time under our belts, the claim administration processes seem to be working quite smoothly. We are distributing claim reports to you on either a monthly or quarterly basis, whichever you choose. The adjusters have been working claims and visiting member cities and towns. If they haven't been to your place yet, look for someone from the MMIA office to drop by in the near future. Taking the claims administration in-house has worked very well for the MMIA. I hope that your experience with us has been pleasant. If you have any questions or comments, please give me a call. This newsletter is published quarterly by Montana Municipal Insurance Au&ority, P.O. Box 6669, Helena, MT 59604-6669. MMIA provides this newslet'rer as a service to its members to inform and educate local officials on liability, workers' compensation, proper't3,, and employment practices issues. Tt~e articles are not a substitute for the Memorandum of Liability Coverage or other coverage documents. All coverage determinations are made on a case-by-case basis, and can only be viewed on the unique facts of the claim presented. M.M.I.A. Newsletter t At a Glance continued from page I am pleased to announce the successful candidate is Nathan Tubergen. Nathan recently retired from his position as Finance Director for the City of Billings, a position he held for twelve years. Prior to going to Billings, Nate had served as Finance Director for the City of Great Falls. Nate's extensive experience with municipal financing will be a tremendous asset to us. Nate will be working to consolidate and streamline the financial operations of the MMIA. Included in his duties will be the task of conducting compliance audits with our member agencies. Please welcome Nate as he travels to the various communities. Workers' Compensation Dividend Once again the MMIA distributed a dividend to the members of our Workers' Compensation Program. Checks totaling $1 million were distributed to member cities and towns earlier this year. This distribution brought the total amount returned to WC participants in recent years past the $5 million mark. In addition to the dividends, the collective premium rate reduction during the 90's exceeded 39%. As I speak with representatives of our members, I find that these monies have made a significant impact. Monies have been used to enhance capital projects, make needed purchases for items including fire trucks and computer equipment, enhance risk management programs, to name just a few applications. While I sincerely hope that the trend continues, members must look upon these dividends as a one-time activity. While the WC market trend has been favorable, nothing lasts forever. Pessimism aside, our current WC year looks good. At this time it appears we could, again, have a surplus at the end of the fiscal year. Law Enforcement Policies The MMIA has been working for several years to develop law enforcement policies for our member agencies. We joined forces with Montana Association of Counties, and thc State Risk Management and Tort Defense Division to produce policies that could be utilized by law enforcement agencies across the state. After countless hours, and the involvement of individuals from all aspects of the law process including law enforcement, prosecutors, public and private defenders, and governmental administrators, the process is approaching a major milestone. As of this writing, the documents have been printed. This document will contain draft policies for the ten most critical incident areas for law enfomement. The program is designed to assist various law enforcement agencies in developing policies that meet the needs of each individual department. The documents provide the critical points that should be included in the individual policies. Staff fi-om the MMIA, MACo, and the State will be presenting workshops throughout the state in May m deliver the materials. As we proceeded through the development process, it became obvious that training must be an essential component of the process. Therefore, you will need to attend the training to receive your documents. If you did not receive word of this training contact Alan Hulse at MMIA. MMIA Board Retreat Members of the MMIA Board of Directors participated in a retreat in early March. The focus of the retreat was a review of the coverage documents for each of our Programs. The coverage documents were reviewed with a critical eye. We were looking for ways to assist the membership with understanding the coverages, and to adjust the documents in compliance with recent court decisions or legal actions. Since workers' compensation coverage is set by statute, the Board spent considerable time discussing the current workers' compensation climate. While our WC Program continues in a very strong financial position, them is apprehension about the future. The national markets for excess insurance are increasing and the courts continue to render decisions that expand coverage. Perhaps the most significant matter facing the courts involves the exclusive remedy doctrine. This doctrine holds that, if an employee is injured on the job and receives coverage they are generally barred from pursuing the employer in civil court. Should exclusive remedy be limited or eliminated, it would have a significant impact on the exposures facing employers. The Board heard a presentation from Martin Herin, of R.F. Driver Co., regarding the status of the excess property insurance markets. Martin reported there is a significant shift underway in these markets. Prices are on the increase due to the numerous catastrophic events throughout the world in the past few years, and to the lack of available coverage for catastrophic events such as floods and earthquakes. It is Martin's belief that we will see property premium prices increase gradually over the next several years. continued on page 3 M.M.I.A. Newsletter 2 At A Glance continued from page 2 The Board spent considerable time reviewing the Liability Memorandum of Coverage. Numerous events have occurred that suggest changes to the Memorandum should be considered. Among the actions taken: (1) elimination of the exclusion of fixed route transit districts (they will be covered as a normal course of business); (2) elimination of the premium surcharge for waterslides (waterslides will be covered as a normal course of business); (3) encourage member participation in the expanded employment practices liability coverage (defense cost coverage currently available at no additional cost via a policy endorsement); (4) change the def'mition of Covered Party to more properly define the coverage afforded to member appointees to various community boards and commissions; and, (5) a study will be conducted over the next year in an attempt to determine options to expanding the EPLI coverage to include indemnification of the members. Based on the discussion during the retreat, the Board set the FY 00/01 preliminary premium rams at the March meeting. Workers' compensation premium rates will remain the same as those charged last year. Due to the market pressures property premiums will increase approximately 5%, subject to some minor fluctuation for the individual deductible. Liability Program participants will see premiums increase 2-3%, again depending upon their deductible category. The FY 00/01 preliminary premium information was mailed April 1. Information about each of the Programs that yom municipality participates in was provided in one envelope. This information will assist you with the development of your budget. The final rates will be effective as of July 1, 2000. Invoices for your Liability and Property premiums will be distributed in late June for payment in July. The first workers' compensation premium using these numbers will be invoiced in September 2000. MMIA Office Facility The expansion of the MMIA staff, resulting from moving the claims operation in-house caused additional facility needs. The unique record storage needs of a claim operation have made finding a suitable location difficult. After considerable study, it was determined that construction of a facility would be cost effective. MMIA purchased land in Helena approximately one year ago in anticipation of building a facility. CWG Architects of Helena has been retained to assist the MMIA in planning and designing a facility. MMIA employees have been surveyed to determine their needs and establish workfiow patterns. We are currently in the final phase of establishing a floor plan. Once agreement on design and cost estimates are reached, we will proceed with plan development and construction. If the project continues as expected we hope to move into our facility in late December. Telephone: (406) 443-0907 Linda Coombs: Ic-mmia~mt.net Toll-Free: (800)635-3089 Linda Moots: Im-mmia~mt.nct Fax: (406) 443-7440 Liz Pratt l iz-mmia~nlt.nct Mail: PO Box 6669 Mark Gau~icr: mg-mmia~mt.net Helena, MT 59604 Nathan Tubergen: nt-mmia~mt.net Street: 810 Hialeah Court (59601) Owen Voigt: ov-mmia~mt.net Web Site: www.mmia, net Paula Vidrine: pv-mmia~mt.net E-mail Addresses: T~a Rygg: tr-mmia~mt.net Alan Hulse: alanmtnia~mt.net Trish Mix: pm-mmia~mt, net Bob Worthington: bo6-rnmia~mt, net Vicki Wilham: vic-mmia~mt.net Liann Meyer: mmia(~mt,nct M.M.I.A, Newsletter 3 WORKERS' COMPENSATION ACCIDENT REPORTING By Paula Vidrine, Workers' Comp. Claims Manager Pursuant to workers' compensation statutes, an injured worker is required to report a work-related injury within 30 days after the date of accident that allegedly caused the injury. The report must be made to (1) a supervisor, or (2) an individual designated by the employer for purposes of filing workers' compensation claims, such as the city clerk, or O) the insurer. Notice of the injury by the injured worker must include the date and time of the injury, where the accident occurred, how the accident occurred (i.e. activity engaged in), and the nature of the injury. Failure by the injured worker to report the injury within 30 days after the date of the occurrence will result in a denial of liability. Although the Department of Labor and Industry has changed the "First Report of Injury or Occupational Disease Report" most of the information previously on the older report is still contained in the revised report. Categories that have been left out On the revised report are the injured employee's occupation, and the department in which the injured employee works. In order for MMIA to provide accurate risk management information, the occupation and department of the injured employee is necessary. Consequently, we are requesting that the accident report include the occupation and department of the injured employee or, the corresponding codes for each. Following is a list of the occupation codes and department codes. These codes are specific to workers' compensation. There are additional codes for liability claims. If the injured employee works in more than one department, please use only the department the injured worker was working in at the time of the injury. Please add this information to the same area where the accident description is located on the accident report form. ® Department 100 Airport 130 Ambulance 150 Animal Control 170 Administration 200 Building Department 300 Cemetery 400 Court 500 Electric Company (power & lights) 550 Fairgrounds/Racing 600 Finance & Administration 630 Fire Department 700 Garbage 730 Golf Course 750 Housing 830 Health Department 1200 Library 1600 Park & Recreation 1630 Parking Garage/Parking Lot 1650 Planning I660 Police Department 1680 Public Buildings 1900 Sewer Department 1930 Sidewalk 1960 Street & Road 1980 Swimming Pool/Beach 2000 Governing Body/Town Council 2030 Transit 2300 Water Department 2600 Jail Occupation 100 Administrator I01 Engineer/Technician/Inspector 103 Supervisor/Foreman 110 Clerk/Treasurer/Payroll/Accounting 112 Office Worker 140 Health Practitioner 142 Health Technician/Ambulance Attendant 143 Nurse/LPN/RN 150 Plant Operator/Water/Sewer 153 Laborer/Helper 154 Machine Operator 170 Firefighter (volunteer only) 171 Firefighter 172 Police Officer (reserve only) 173 Police Officer 174 Sheriff 180 Service Employee 181 Emergency Medical Service 182 Janitor/Custodian 190 Tradesperson 191 Carpenter 192 Electrician 194 Mechanic/Repairman 195 Painter 201 Welder/Solderer 210 Vehicle Operator 212 Bus Driver 213 Mobile Machine Operator 216 Truck driver/Teamster 251 Volunteer (other than police & fire) M.M.I,A. Newsletter 4 CAN LIABILITY BE FUN, FANTASTIC, AND CREATE A EUPHORIC SENSE OF SELF WORTH? By Owen P Voigt, AIC, ARM Property and Liability Claims Manager Maybe, but I will bet these action words do not describe the emotions or sensations you will feel as you review your city/town ordinances. I would say reviewing ordinances would be more in the order of a "necessary evil.' We see more and more claims relating to inconsistencies in public documents designed to give direction. Imagine reviewing your city/town ordinances, state statutes, subdivision rules, Uniform Building Codes and case law to find the definition of a street. Follow me for a few minutes of exciting reading on what this can mean to you as you gettu work and start your job for the day. Everyone who works for a city or town is in some way bound to do tbeir job by their ordinances. What do you do when your ordinances say one thing, but are not consistent with the other published directive documents? We recently investigated a sidewalk trip and fall claim. We had denied this claim because there was no notice of the defect in the walk. The claimant's attorney reviewed the city/town ordinances. The ordinances stated "the sidewalk commissioner would conduct an annual survey to determine if the sidewalks were safe." As we had stated there was no notice, so we went back to the city/town and asked who the sidewalk commissioner is, and could we see his/her survey. The clerk for the community told us they do not look at the sidewalks annually, nor do they have a sidewalk commissioner anymore. As near as she could tell they quit this in the 60's, as no one wanted to conduct the survey. They did however have an ordinance that said the city/town would do this. Notice was the main issue in this claim. In another case we needed to look at the definition of a street. What a dilemma! We reviewed the ordinances for the city/town that had the claim. Their definition did not include any terminology for a private street which is platted. We looked at ordinances for two (2) other communities, whose definitions both varied. We looked at applicable cases in Montana and found the Supreme Court has not addressed this in Montana. We then went to other states for gaidance on an interpretation. We found nearly as many definitions as there are states. Unfortunately, this means the interpretation is not clear, and could go either way. This could be resolved by making sure your ordinances do define and mean what you want. If the ordinance had simply stated that a street included a privately owned platted road that is used for vehicular travel, the entire issue would have been resolved. Remember, if your ordinances are silent on an issue and someone makes a claim, a court will determine what your ordinances mean. As stated by Alan Hulse, our Risk Specialist, "Ordinances are written and followed to establish your working blueprints." They are written to identify what is expected of you and your staffwhile doing your job. When your ordinances are more restrictive than what the law requires, you will be held to your ordinances. We had a claim involving someone who slipped on a walk in front of some property. The residents who owned the property were out of state for the winter. No one had shoveled the walk, and the claimant looked to the city to pay for his or her bills. Upon investigation, we located a city ordinance which stated "if the resident/owner of property adjoining a city street and fronting a city sidewalk was out of state, the city would clean the sidewalk in front of the property." This ordinance was nearly as old as the town. Here again, no one with the city has shoveled walks for private residents for many years. In this claim we were able to show the residenffowner did not notify the city of his/her absence, so there was no duty to shovel the walks. Another instance is where the city had an ordinance which stated "if there was a ~ inch or greater defect in the sidewalk, it was considered hazardous and needed to be removed and replaced or repaired." The courts in Montana generally allow a 1 1/8 inch to 1 ~A inch defect before it is considered hazardous. Guess what happened here? We paid it. In this instance, the city had this ordinance on the books, but because of budgetary issues did not fund their sidewalk replacement program. Please review your ordinances. Repeal old and out dated ordinances and develop new ordinances which identify what you do, the services provided and responsibilities/expectations delegated to citizens. Make sure you work according to those ordinances. ~ M.M,I.A. Newsletter 5 WORKERS' COMPENSATION WAGE LOSS BENEFITS CONCURRENT EMPLOYMENT - VOLUNTEERS By Paula Vidrine, Workers' Comp. Claims Manager Workers' compensation pays for medical treatment directly related to an industrial injury. Workers' compensation also provides for wage loss benefits during the period of time the treating physician restricts an injured employee from working as a result of the injury. There are no wage loss benefits payable for the first 48 hours, or 6 days of lost wages, whichever comes first. Wage loss benefits are based upon 66 2/3% of the average weekly wage of the four (4) pay periods preceding the date of injury. The maximum weekly compensation rate may not exceed the state's average weekly wage at the time of the injury. The state's average weekly wage is recalculated annually, and is effective every July I through June 30 of the following year. Consequently, the maximum weekly compensation rate changes each year. However, the rate is calculated as of the date of injury and does not change, regardless of wage increases that may occur after the date of injury. When an injured worker has concurrent employment(s) and is medically unable to work in the time of injury position as well as the concurrent employment~ the wages of the concurrent employment are also included in the wage loss benefit rate calculation. The benefit rate is still limited to the maximum weekly benefit rate established at the time of injury. In the event the injured worker is a volunteer and the employer has elected to provide workers' compensation coverage for the volunteer, the wage loss benefit rate is based upon wages earned by the injured worker in his/her regular employment. However, if the injured worker is a partner or sole proprietor in their regular employment and has elected not to cover themselves for workers' compan~ation in their regular employment, wage loss from that employment is not considered when determining the wage loss benefit rate. This would also apply to a concurrent employment. MMIA PO BOX 6669 HELENA MT 59602-6669 M.M,I.A, Newsletter