Earning Retro Refunds Takes Time

by Liz Evans

Employers new to a Retro group are eager to begin earning refunds.  However, “vesting” in a group takes approximately 18-24 months.  The word “retrospective” means looking back or considering something that has happened in the past.

Each retro group has their own established plan year which may begin any quarter throughout the year and determines when the groups refunds are calculated.  The plan year begins on the first day of the calendar quarter in which the employer enrolls and ends 12 months later.

The Retro program has 3 adjustment cycles per plan year, which means it takes 3 years to earn and distribute the full refund.  The first adjustment is 10 months AFTER the end of a plan year, the second adjustment is 22 months AFTER the end of a plan year and the third and final adjustment occurs 34 months AFTER the end of a plan year.

If you join a July plan year group on July 1, 2024, you are enrolled at the beginning of the group’s 2024 plan year, which will have its’ first adjustment refund distribution calculated in early May 2026.  Each group sets its own distribution schedule – below is the refund schedule for the July groups that Approach manages for the members of SMART and PITB groups.  The groups do not distribute 2nd adjustment refunds because the final liability costs for the claims are not complete until the 3rd and final adjustment.

Remember claims work their way through a slow adjudication process and it takes time to reap the rewards of joining a group.  Employers who make safety and proactive claims management a priority, will be very happy when they receive their first refund check!