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Deductibles. do not affect the experience modification calculation. Even though under a deductible option the city reimburses LMCIT for certain medical costs, those costs are still included in calculating the experience modification. Like the retro- rating options, deductibles are a way of retaining risk, so if the city uses a deductible option it's important to fund that risk. Remember that the deductibles apply per occurrence, and you need to be prepared for the possibility that you'll have multiple occurrences during the year. For more information on deductible options, refer to the "Workers' Compensation Deductible Options" memo. Managed care option Cities that enroll with a state - certified managed care organization (MCO) receive a 3 %premium credit on their work comp coverage. MCOs attempt to reduce the total costs of work comp claims by providing care in a network setting, establishing cost effective treatment protocols, and working to return the employee to work as soon as possible. If the MCO is successful in reducing loss costs, the city would see additional savings in the form of an improved experience modification. LMCIT has been monitoring cities' experience with MCOs for several years. The results are not clear -cut, though the most recent review suggests that managed care may be producing at least some overall savings for some cities. There are now only three certified MCOs in Minnesota: Corvel, which is the one that cities have used most often; HealthPartners, which several cities use; and Intracorp /Araz. Some factors to look at in selecting an MCO are whether the MCO has network providers in their area; the MCO's fees and charges; and whether the MCO's overall approach and philosophy matches the city's. For a current list and contact information for certified MCOs, contact the Department of Labor and Industry at 800 - 342 -5354 or www.doli.state.mn.us. Non - smoker credit for police and firefighters LMCIT offers member cities a 10 percent rate credit for non - smoking police and firefighters. To qualify for the credit, the city must obtain written statements of non - smoking from at least 90 percent of the members of the department. The statement must be signed and dated, and must state that the individual does not smoke and has not smoked within the previous six months. LMCIT gives this discount because several of the diseases presumed by statute to be job - related for firefighters and police officers — various heart diseases, lung diseases, and cancers — are also related to smoking. Fire or police departments with very few smokers represent a lower risk for claims for heart disease, lung disease, or cancer. For more information on how this credit works, refer to the "Workers' Compensation for Volunteer Firefighters" memo. PST 01/06 - 6 - - 2 9 -