Assigned to COM FOR COMMITTEE
ARIZONA STATE SENATE
Fifty-Fifth Legislature, Second Regular Session
FACT SHEET FOR H.B. 2121
workers' compensation; medical-only loss
Purpose
Requires any experience rating adjustment for workers' compensation claims involving
medical-only loss to be applied to reduce the impact of the loss in the employer's experience
modification rating.
Background
Statute requires an employer to secure workers' compensation to their employees by either:
1) insuring and keeping insured the payment of such compensation with an authorized insurance
carrier; or 2) furnishing to the Industrial Commission of Arizona (ICA) satisfactory proof of
financial ability to pay the compensation directly or through a workers' compensation pool
approved by the ICA (A.R.S. § 23-961).
An insurance carrier authorized to transact workers' compensation insurance in Arizona
may offer deductible coverage for employers. If an insurance carrier offers deductible coverage to
an employer, the employer must submit a certified copy of the employer's most recent financial
statement to the insurance carrier to justify the deductible amount the employer chooses. Losses
subject to the deductible must be reported and recorded as losses for purposes of calculating rates
for a policyholder on the same basis as losses under policies providing first dollar coverage (A.R.S.
§ 23-963.01).
There is no anticipated fiscal impact to the state General Fund associated with this
legislation.
Provisions
1. Requires any experience rating adjustment for workers' compensation claims involving
medical-only loss to be applied to reduce the impact of the loss in the employer's experience
modification rating.
2. Defines medical-only loss as a loss that has no indemnity value reflecting lost wages.
3. Makes technical changes.
4. Becomes effective on the general effective date.
House Action
COM 2/15/22 DPA 9-0-0-1
3
rd
Read 2/23/22 59-0-1
Prepared by Senate Research
March 7, 2022
JT/sr