2. Worker's Compensation
3. Insurance Letters
4. Insurance Letter 532

Insurance Letter 532

Purpose

To communicate to insurance carriers and self-insured employers the new assessment rate. This includes information regarding deadlines and reminds insurance carriers and self-insured employers that interest will accrue on all unpaid balances after 30 days. The Worker’s Compensation Administrative Assessment is issued annually.

Background

Section 102.75, Wis. Stats., authorizes the department to assess and collect the administrative costs for the Wisconsin Worker’s Compensation Act from worker’s compensation insurance carriers and self-insured employers. Each company's indemnity amount is determined by summing the amounts paid for each claim "first closed" in the previous calendar year. Indemnity includes payments for temporary total and partial disability, permanent total and partial disability, compromises, death benefits and funeral expenses, paid holidays, supplemental benefits, disfigurement, and vocational rehabilitation.

The Worker’s Compensation Administrative Assessment rate is calculated by dividing the current state fiscal year’s operating costs by the total indemnity payments from carriers and self-insured employers for claims "first closed" in the previous calendar year. The total indemnity paid for 2020 "first closed" claims was $215,614,166. The Worker’s Compensation Division’s (WCD) net operating revenue to be collected for State Fiscal Year (SFY) 2022 is $12,804,550. Based on the calculation ($12,804,550 divided by $215,614,166), the general assessment rate is 5.939%. The resulting rate is rounded up to avoid a budget shortfall.

Self-insured employers pay the 5.939% general assessment rate plus an additional 1.755% to cover administrative costs of operating the self-insured employers program for a total of 7.694%. The self-insured employer invoice also includes the $200 self-insured renewal fee for the period of July 1, 2021 through June 30, 2022.

Each company's assessment amount is determined by multiplying its 2020 "first closed" claims' total indemnity payments by the rate indicated. Each company's claim detail listing is available at Administrative Assessments; click on Assessment Reports. You will need your DWD/WISCONSIN Logon Account ID and password.

The overall budget funds three major components:

• The Department of Workforce Development (DWD) - WC Operations
• The Department of Administration, Division of Hearings and Appeals, Office of Worker's Compensation Hearings (OWCH)
• The Labor & Industry Review Commission (LIRC)

OWCH and LIRC are reimbursed out of the overall budget for services provided to the Department. The breakdown of SFY21 expenditures are as follows:

WC Administrative Service Providers	SFY21 Expenses	% of Total
DWD-WC Operations	$8,281,500	65.17%
DHA-OWCH Services	$4,011,911	31.57%
LIRC Services	$414,707	3.26%
SFY21 TOTAL	$12,708,118	100%

Action Requested

Payment Submission Options

1. Checks payable to DWD-Bureau of Finance (See invoice for remittance address)
2. ACH (electronic) payment instructions may be requested at the email address, below.

Inquiries

WC Assessment or Pati Brown at (608) 405-4598 or Lynn Weinberger at (608) 405-4600.

Please do not include email attachments; attachments sent to general email boxes are automatically deleted.

Enclosure

Invoice *

* Invoices may be requested via email. Please request by emailing WC Assessment and providing your preferred email address and the names of all organizations for whom you process payments. Please do not include email attachments; attachments sent to general email boxes are automatically deleted.

Reference

WC Division website for claim detail listing