NCCI Appeal Board to SC Employers: Drop Dead

Okay, okay, I know that's a melodramatic headline. I've just always wanted to use a variant on that famous NY Post headline, "Ford to NY: Drop Dead" and now I've done it. But even though it's a little strident, I think it fairly summarizes what the NCCI's South Carolina Dispute Resolution board just told us (and four of our South Carolina clients).

Here's the deal: we've been working for years now on the issue of Second Injury Fund reimbursements in South Carolina, and how insurance companies have often failed to properly report those SIF reimbursements they get. You see, when an insurance company gets reimbursed by SIF for a Workers' Comp claim that the insurer has paid on behalf of a policyholder, the insurance company is supposed to report those reimbursements to NCCI. That way, the experience modification factor for the employer gets adjusted downward to reflect the fact that the claim's cost is lower than earlier reported.

But we found out years ago that insurance companies were routinely failing to make those corrected reports to NCCI, and that NCCI had been making no effort to police such reporting failures. As is often the case, the insurance industry was happy to just let the employers pay the inflated costs for the failure of insurance companies to follow their own rules.

We've been working with a number of South Carolina employers to get these abusive overcharges corrected and refunded, and we've had considerable success with our efforts.

But for some affected employers, there was a problem. The errors had occurred just long ago enough that NCCI rules did not allow for the routine correction of these experience mods. So NCCI suggested that we ask this Dispute Resolution board that NCCI operates for South Carolina for an exception for these cases.

Today we got the letter from that board. They flatly refused to hear our appeals for these employers. They wouldn't even let us make our case before them. Like I said in our headline, they said, in essence, "Drop Dead".

Now, we're not exactly willing to accept this back of the hand treatment. We're already working with our various contacts down in South Carolina, including the South Carolina Small Business Chamber of Commerce, to see what redress may be available once the South Carolina legislature and the South Carolina Department of Insurance are apprised of the situation.

It's just frustrating that it should be so bloody difficult to get this all fixed. The insurance industry makes a great hue and cry over situations that they feel defraud them of proper Workers Compensation insurance premiums. Insurance companies do not hesitate to seek criminal sanctions against those they feel have cheated on Workers Comp premiums. So you would think that the insurance industry would want to be particularly scrupulous to correct situations where the shoe is on the other foot, where it is the insurance companies that have defrauded their policyholders.

Such is not the case for these defrauded South Carolina employers. Not yet, at any rate.