Beginning January 1, 2020 and every January 1 thereafter, all Permanent Total Disability (PTD) and Survivors' Benefits Claims are entitled to receive an annual increase of 2.3% to their monthly benefit rate. The amount that is a result of the COLA (the amount of the increase) is paid by the insurer but may be reimbursable depending on the date of injury or occupational disease disablement:
- PTD Claims: DOI or Occupational Disease Disablement prior to January 1, 2004
- Survivors' Benefits Claims: DOI or Occupational Disease Disablement prior to July 1, 2019
THE COLA REIMBURSEMENT PROCESS – STEP BY STEP
The 2019 Nevada Legislature made changes to benefits for PTD and Survivors’ (Death) claims. Starting in January 2020, NRS 616C.473 and NRS 616C.508 require insurers to pay an annual 2.3% increase in benefits for PTD and Death claims. NRS 616C.266 and NRS 616C.268 allow insurers to be reimbursed for the costs associated with the annual increase for certain eligible claims. NRS 616A.425(g) and (h) allow the Fund for Workers’ Compensation and Safety to cover the costs of the reimbursements to insurers associated with the annual increase in compensation for PTD and Death claims. The source of this funding will come from assessments on all workers’ compensation insurers.
The following steps have been established to implement this process:
Step 1: Verification - AMW/Monthly Rate - Please submit to WCS ASAP (One-time):
In order to ensure correct benefit payment by insurers and ultimately correct reimbursement, insurers and TPAs must submit eligible claims to WCS for verification of AMW/Rate. The purpose of AMW/Rate Verification is to ensure that the Average Monthly Wage (AMW) and monthly rate as of December 31, 2019 (or December 31st of the year prior to applying the first 2.3% COLA increase) have been calculated correctly for claims eligible for COLA reimbursement. This ensures that COLA increases are calculated correctly and only verified costs associated with the COLAs are reimbursed. This step must be completed before a request for reimbursement for payment of the COLA can be processed. To be considered for reimbursement by the DIR, eligible claims must be submitted to DIR/WCS for one-time verification of correct AMW/Monthly Rate calculation per the following instructions and forms:
Submit Verification Forms and
Step 2: Request for Reimbursement - Costs Associated with COLAs - Must be submitted by March 31 each year (Annual):
Insurers and TPAs must submit requests for reimbursement of COLA payments for eligible claims no later than March 31 each year (starting in 2021) for the prior calendar year COLA payments. WCS will review reimbursement requests for approval or denial of reimbursement.
Submit Reimbursement Request
Forms and Documentation to:
[DIR/WCS has completed the processing of Requests for Reimbursement for calendar year 2021 COLA payments.]
Step 3: Special COLA Assessment (Annual):
After all requests for reimbursement have been processed by WCS for the prior calendar year, DIR will levy a special assessment on all workers’ compensation insurers to cover the total amount approved for reimbursement for the prior calendar year COLA payments.
[The FY21 Special COLA Assessment invoices were sent to insurers on June 1, 2022 with the regular annual assessment. Payment was due July 31, 2022.]
Step 4: Reimbursement to Insurers (Annual):
After the Special COLA assessment has been collected from all insurers by DIR, checks will be issued by the State of Nevada Controller's Office with approved amounts for reimbursement to the Assessment Contact on file for each eligible insurer.
[Reimbursement checks for calendar year 2020 COLA payments were issued to insurers on or around February 18, 2022. Pro-rated payments were issued because some insurers were delinquent in paying the Special COLA Assessment.]
Frequently Asked Questions
Direct questions to: COLAS@dir.nv.gov