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Rating Bureau Aims to Require COVID-19 Claims Count Against X-Mods


California’s Workers’ Compensation Insurance Rating Bureau has proposed plans to start requiring COVID-19 claims to be included when calculating employer X-Mods, according to a report by an industry trade publication.

The proposal, which would have to be approved by the state insurance commissioner, would bring to an end current rules that exclude the impact of COVID-19 workers’ compensation claims on X-Mods, the Workers’ Comp Executive reports.

The current measure was put in place after Gov. Gavin Newsom in April 2020 issued an order that any workers who were reporting physically to work and who contracted COVID-19 would automatically be presumed to have contracted it in the workplace.

That in turn meant that those cases would be treated as workers’ comp claims, which entitled the workers to having their medical expenses covered as well as being paid temporary disability benefits for time they missed from work due to the coronavirus.

In response, the Rating Bureau issued the temporary rule excluding COVID-19 workers’ compensation claims from X-Mods. At the time, it said that those claims did not reflect effectiveness of employers’ workplace safety efforts as they likely had not contemplated the pandemic.

Rationale behind proposed rule change

According to the report by the Executive, Rating Bureau staff wrote in the proposal for the new rule change: “The COVID-19 workers’ compensation claim environment has changed significantly since the experience rating exclusion of COVID-19 claims was first recommended and ultimately adopted.

“In the early months of the pandemic, relatively little was known about how COVID-19 was transmitted, there was little in the way of widely accepted workplace safety protocols and tens of thousands of COVID-19 workers’ compensation claims were being filed.”

The Rating Bureau reasons that now that we have a better understanding about how to reduce the spread of coronavirus through mitigation measures, in widespread COVID-19 vaccinations in the state, it’s time to no longer exclude these claims from X-Mod calculations.

It said one role of experience rating is to provide an incentive to keep workers safe, according to the Executive.

Since the start of the pandemic, there had been 164,320 COVID-19 workers’ comp claims with illness filed in California through Oct. 18, 2021. There had also been 1,163 workers’ compensation COVID-19 death claims as of that date.

The takeaway

The proposal will still need to be adopted by California’s insurance commissioner. If adopted, it will take effect Sept. 1, 2022.

By now, any employer with workers on-site should have protocols in place to protect their workers against COVID-19 transmission in the workplace.

The rule change will provide an additional incentive to protect your employees, as any claims that require medical treatment and/or time away from work will count against your workers’ compensation claims experience.