VWC Releases 2017 Annual Report

On September 13, 2018, the Commission issued its Annual Report for the year 2017.  In its report, the Commission highlighted several updates to their operations and new programs implemented over the previous year.

The Chairman of the Commission, Wesley Marshall, in his Chairman’s Statement pointed out that this year, 2018, marks the 100th Anniversary of Workers’ Compensation in Virginia. He also mentioned the relocation of the Richmond headquarters, and the Manassas and Virginia Beach offices to new locations and the resulting improvement in information security, which allowed the Commission to meet or exceed all of the Virginia Information Technology Agency’s information security standards. Commissioner Marshall made special mention of the new process for global mediation of multiple Medical Fee disputes at once, and the implementation of the new Medical Fee Schedule.

The Report also provided financial statistics from the previous year. On the cost front, Virginia remains a leader in workers’ compensation premium per $1,000.00 of employer payroll. In 2016, Virginia ranked 47th most expensive (or 4th cheapest) of the 50 states, plus the District of Columbia at a premium rate of $1.24 per $1,000.00 in payroll. That figure places Virginia 67% below the median state rate.

The Commission collected $41,578,202.00 in premium taxes, which it used for operating expenses. The Uninsured Employer’s Fund took in $4.6 million in taxes, fines and recoveries, while expending $5.1 million over the same period. The Criminal Injuries Compensation Fund (CICF), also administered by the Commission took in $7.5 million via court costs, judicial branch transfers, restitution and federal grant money.  The CICF’s expenses totaled $7.8 million: $5.2 million in awarded claims and $2.6 million in administrative costs. These shortfalls may suggest an increase in premium taxes and/or court costs in the near future.

In its legislative update, the Commission highlighted two bills that were passed in 2017. HB 1571, passed in the 2017 legislative session amended the statute governing the medical fee schedule, §65.2-605, to increase the maximum payable under the charge outlier and stop-loss provisions from 150% of the amount allowable under the fee schedule up to 300% of the fee schedule for treatment that requires Level I or II trauma center treatment for trauma or severe burns, and clarifies some technical definitions related to the fee schedule. HB 1659 amended §65.2-309 and prevents employers from initiating an arbitration to recover its lien against a third party without notice to and approval by the Commission and the claimant. The bill also permits claimants to intervene as a matter of right in any third-party action or arbitration brought by the employer.

The Commission’s key accomplishments included the implementation of the Medical Fee Schedule, the office relocation’s mentioned above, and technological improvements which allow video conferencing, and automated employee training. Several successful outreach programs, including the annual seminar and other external training sessions were mentioned.

The report also included claims figures for the calendar year 2017:

  • Employers reported 58,094 major workplace injuries;
  • Claimants filed 48,007 claims;
  • Agreements resulted in the entry of 26,655 Awards;
  • 10,740 Awards were terminated;
  • 5,699 settlements were approved by the Commission resulting in an aggregate of $297,153,851.00 in settlement payments, an average settlement value of $52,141.40.

As the Alternative Dispute Resolution (ADR) department continues to grow, its impact has increased. In 2017, the ADR division saw an increase in referrals of 80% over the previous year. Full and final mediations had a 75% resolution rate, and 65% of issue mediations were reported resolved.

The Commission’s Electronic Data Interchange (EDI) report card program and compliance efforts resulted in a 16% decrease in fines issued for EDI noncompliance. The insurance division reported having done 1,414 compliance investigations, an increase of 38% over the previous year. These investigations resulted in 240 additional employers being brought into compliance with insurance provisions, and an 18% decrease in the number of employer compliance notices issued. There was also a 55% decrease in policy lapses by employers in 2017 due to increased compliance efforts.  Notices and Orders issued to carriers by the Insurance division also decreased in 2017.

As technology use increased, the Commission experienced a 67% increase in the number of paperless webfile users, and a 27% increase in the number of documents filed by webfile. The Commission has also integrated Optical Character Recognition (OCR) to its systems which will allow for text searches within webfiled documents.

Looking forward, the Commission again noted that 2018 is the centennial of workers’ compensation in Virginia, and that centennial events will occur throughout the year. Their goals for this year include increased engagement from injured workers, victims of crime and allied professionals; continued facility upgrades at regional offices, implementation of the Medical Fee Schedule, continued compliance efforts and improved efficiency in the Commission’s business processes.

The Commission’s Annual Report for 2017 is available on the Commission’s website at:

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