Coins of the Realm

By | June 6, 2005

You’ve probably heard by now about what happened in Ohio. The administrator of the state’s Bureau of Workers’ Compensation, Robert Conrad, has resigned amid a scandal over hundreds of missing coins. But these aren’t the kind you can locate by looking in between the cushions of your couch–the missing coins are valued at $10 million to $12 million and total 20 percent of the bureau’s investment.

Politically connected Toledo coin dealer Tom Noe had finagled himself into the job of managing the bureau’s investments. Naturally, he concluded that rare coins were an excellent investment–a hedge against the risks of stocks and bonds, he argued. Before hundreds of coins went missing, along with Noe, the bureau had made $15.3 million. Noe also took home a good chunk of change: $3.8 million in commissions.

At first, Conrad claimed that “only” $400,000 worth of coins were missing. When the real figure came out, he had no choice but to resign at the not-so-gentle urging of Republican Gov. Bob Taft.

Conrad, who was appointed by the previous Republican governor and now Sen. George Voinovich, is credited with straightening out the bureau. And it’s probably true that the bureau is a better functioning agency today than it was when he took over, even if it can’t keep hold of its loose change.

The real scandal, though, is that Ohio employers still face the fifth-highest premiums in the country, according to a 2004 study by the Oregon Department of Consumer and Business Services. Only California, Alaska, Florid and Hawaii ranked worse. Out of every $100 in payroll paid by Ohio employers, $3.59 go to pay workers’ comp premiums. In fact, Ohio’s ranking worsened by nine spots–14th–from 2002 to 2004.

It’s well past time for Ohio to join the rest of the states and allow private insurers to compete. Nowhere in America is workers’ compensation an easy line of business to write, but there is no reason not to take advantage of a competitive marketplace. If the state thinks it can do best by employers and workers, then let its fund compete on an even legal playing field with private insurers.

I suspect that then we’d see the Bureau of Workers’ Compensation losing a lot more than $10 million in coins. The savings from a competitive workers’ comp market could just wind up in the pockets of employers instead of politically connected scam artists.

Was this article valuable?

Here are more articles you may enjoy.

From This Issue

Insurance Journal West June 6, 2005
June 6, 2005
Insurance Journal West Magazine

Marine & Tech Directory