The Importance of Understanding Your NEER Statement

How many of you can relate to this scenario: Your NEER statement arrives in the mail and you immediately file it away in your desk? December rolls around and your Controller or Finance department approaches you inquiring why the company owes a surcharge to the WSIB? Are you able to explain why?

This is something we hear often when discussing NEER statements with HR Professionals. With so much on your plate already, learning how your NEER statement has been calculated and why you are potentially owing thousands of dollars to the WSIB can be overwhelming.

NEER is a very complicated system already, now factor in the new 4 year window and you really have a convoluted program.   So what should you be looking for when you get your statement?

Looking ahead to September 2012 and your next NEER rebate or surcharge, it’s important to know if you currently have claims that are active in the 2012 year.  Active claims or claims that are receiving of Loss of Earnings (LOE) benefits in the year of review (currently 2012), can significantly affect your NEER refund or surcharge.  Your claims management process and the decisions you make regarding return to work and accommodation can swing a pending rebate to surcharge or potentially the other way around.

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What do we mean?

Case Study
(The following case study is based on an actual NEER Review. Names have been modified for confidentiality. The rating factor for Company A is 78.7%)

As a starting point, using the September 2011 NEER statement we can forecast Company A at a projected surcharge of $550,876.53 for September 2012.  However to get a more true indication of what September 2012’s NEER rebate or surcharge will look like we need to review any currently active claims.   Company A currently has a claim for John Doe in August of 2011 which is active as of the September 2011 statement: will this claim remain active into September 2012? 

The following will have significant impact on Company A’s pending NEER costs:
Type of Claim

• Whether a claim is active (meaning LOE is being paid in the year of review)

Return to work strategies

• Did the worker return to work but more specifically did they come back to work December 1stand with no wage loss?

SIEF cost relief

• Has the company requested Cost relief and will it be applied before September?
  
  

After reviewing Company A’s September 2011 NEER statement an estimate based on returning John Doe to work as of December 2011 with no further loss of earnings is calculated. We assumed that LOE will stop as of December 2011 so we included costs from the monthly cost statements from October, November and December 2011 and anticipating a claim type change in 2012 (Claim type becomes inactive since the worker return to work prior to December 1st 2011).  Based on this information we can forecast that the potential surcharge is reduced to $168,293.09, a savings of $332,583.44.

However if this worker continued to lose time until approximately June 2012, we are able to forecast that the NEER surcharge would only decrease to $249,872.97.   In this case returning this employee to work by June 2012 does also reduce Company A’s surcharge but resulted in $251,003.56 savings in NEER costs.

Loss of Earnings (LOE) and when they are paid can have a significant impact on your NEER rebate or surcharge position in September.  Clear Path’s approach to claims management is to return injured workers to work on suitable modified duties at full wages as soon as possible. Foster an early and safe return to work plan along with medical management and continual communication with your WSIB adjudicator and the employee.  Understanding your NEER statement and how your costs will fluctuate is key to making sure your rebate is maximized or your surcharge is minimized.

In our upcoming workshop “Demystifying the WSIB’s NEER Program”, we discuss 10 case studies and how your RTW decisions can impact your pending September NEER rebate or surcharge. 

Clear Path also offers a complimentary and confidential review of your most recent NEER statement by our WSIB claims specialists (a $250 value!).  Our experts will forecast your costs for this year and identify areas of potential savings. You have nothing to lose and there is absolutely no obligation to utilize our services further.   Fax your most recent NEER statement today to (519) 624-0860 for a complimentary review.

Clear Path has a particular specialty in cost-effective WSIB claims management, return-to-work (RTW) strategies and acquiring SIEF cost relief. Click here to learn more about our WSIB claims management services.

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