Oct
12
2009
1

Ogilvie Calculations Made Simple, II

Back to the drawing board

Back to the drawing board

DOWNLOAD THE MATHEMATICAL PROOF AS A PDF!

A little while ago William S. Morris, an Applicant’s attorney, told me that the Ogilvie adjustment calculation could be further simplified. [1] He suggested the following[2] :

  1. Earnings Loss[3][4]
    1. L = (PIESSE – PIEA) / PIESSE
  2. Individualized Proportional Earnings Loss
    1. = (WPI / L) / 100
  3. DFEC Adjustment Factor
    1. = ([1.81/a] * .1) + 1
    2. = ( (1.81 * .1)/a) + 1
    3. = (.181/a) + 1
    4. = 1 + (.181/a)
  4. Ogilvie DFEC Adjusted Rating
    1. = WPI * DFEC Adjustment Factor
    2. = WPI * (1 + (.181/a) )
    3. = WPI * (1 + (.181 / Individualized Proportional Earnings Loss) )
    4. = WPI * (1 + (.181 / ( (WPI / L) / 100) ) )
    5. = WPI * (1 + (18.1 / ( (WPI / L)  ) )
    6. = WPI * (1 + (18.1 * (L/WPI) ) )
    7. = WPI + (18.1 * L)
  5. Conclusion
    1. If the injured workers’ individualized proportional earnings loss is outside all of the FEC ranks, you may calculate the Ogilvie adjustment by adding (18.1*Earnings Loss) to the WPI.

The only flaw with the proofs offered by William and myself is that they are too exact.  The WCAB in Ogilvie never sets forth the exact process for performing the Ogilvie adjustment calculation – so the only official method involves rounding to different significant figures at different places.  Thus, a calculation performed in strict accordance with the WCAB in Ogilvie and through one of these mathematical proofs would differ very slightly.

What do you think? Leave a comment or drop me a line.

  1. Photo courtesy of Dahveed76 []
  2. I’m paraphrasing here []
  3. PIESSE = Post Injury Earnings of Similarly Situated Employees []
  4. PIEA = Post Injury Earnings of Applicant []
Jul
17
2009
5

Ogilvie Calculations Made Dead Simple

Ogilvie for Dummies

Ogilvie for Dummies

UPDATE: DOWNLOAD THE MATHEMATICAL PROOF AS A PDF!

Get ready to stop paying people to do Ogilvie calculations, recycle your Gearheart/Gerlach handouts, and delete your Frost Excel spreadsheet.[1]  We’re about to go all “Beautiful Mind.”

Yesterday while at the Oakland WCAB an Applicant’s attorney mentioned he noticed an interesting trend in the Ogilvie formula. [2][3] He said that whenever he does an Ogilvie calculation for someone with a 100% earnings loss and a modest WPI, the WPI is always increased by 18. [4]

I ran a number of test calculations on this theory and it appeared to be right.  My calculations show that up to a WPI of 44 the increase appears to always be 18.1, but the last “0.1” always gets rounded down.  However, appearing to be right just isn’t good enough for me.  And, because I am just truly that nerd, here’s the fully mathematical proof:

Let’s break down the calculations at the heart of Ogilvie:

  1. Earnings Loss[5][6]
    1. = (PIESSE – PIEA) / PIESSE
    2. = ($1.00 – $0.00) / $1.00
    3. = $1.00 / $1.00
    4. = 1
    5. = 100%
  2. Individualized Proportional Earnings Loss
    1. = (WPI / Earnings Loss) / 100
    2. = (WPI / 100% )/100
    3. = (WPI / 1) / 100
    4. = WPI / 100
    5. Thus, for any WPI less than 45 and a total loss of earnings, the Individualized Earnings Loss will always be less than 0.450 in Table A.
  3. DFEC Adjustment Factor
    1. = ([1.81/a] * .1) + 1
    2. = ( (1.81 * .1)/a) + 1
    3. = (.181/a) + 1
    4. = 1 + (.181/a)
  4. Ogilvie DFEC Adjusted Rating
    1. = WPI * DFEC Adjustment Factor
    2. = WPI * (1 + (.181/a) )
    3. = WPI * (1 + (.181 / Individualized Proportional Earnings Loss) )
    4. = WPI * (1 + (.181 / (WPI / 100) ) )
    5. = WPI * (1 + (.181 * 100 / WPI ) )
    6. = WPI * (1 + (18.1/ WPI ) )
    7. = WPI * ( (WPI/WPI) + (18.1/ WPI ) )
    8. = WPI * (WPI + 18.1/ WPI )
    9. = WPI * (WPI + 18.1/ WPI )
    10. = WPI + 18.1
  5. Conclusion
    1. If you have an Applicant with a 100% post injury earnings loss and a WPI of 44 or less, you should rebut the FEC and arrive at an adjusted WPI that is equal to the original WPI plus 18.1.

Therefore, I propose a new Ogilvie formula that will be easy for anyone to remember:

  • Step 1: If the injured worker has a 100% earnings loss and a WPI of 44 or less, add 18.1 to the WPI and round down.
  • Step 2: If the injured worker has less than 100% earnings loss or a WPI of 45 or higher, go to Step 3.
  • Step 3: For heaven’s sake, just make your life easier and use the calculators here at PDRater.com.

What do you think?  Leave a comment or drop me a line.

  1. Sorry Jeff, Mark, Mark, and Ray! []
  2. Thank you “S”!  Unfortunately, he did not want to be named. []
  3. Man, I *wish* I could take credit for this observation. []
  4. Not multiplied by 18, but an addition of 18. []
  5. PIESSE = Post Injury Earnings of Similarly Situated Employees []
  6. PIEA = Post Injury Earnings of Applicant []
Apr
20
2009
2

No, Seriously, It’s Free

PDRater: No Bills!

PDRater: No Bills!

To this day, most of the e-mails I receive are from people asking me some variation of “No, really, how much does it cost to use these calculators? When am I going to be charged? What’s the catch?”

I intend to keep all the calculators free for anyone who cares to use them. I have built this website because I really do enjoy the hell out of blogging about tech stuff and workers’ comp law, dissecting complex workers’ compensation math formulas, and building something useful to myself and other professionals. This is quite literally how I spend my free time. I’m just that nerdy.

Nov
18
2008
2

False Sense of Security

Imaginary Security

Imaginary Security

What’s worse:

Having no security or having the illusion of security?[1][2] Before you answer, you might want to read this article about how TSA security at airports is just plain ridiculous.

Keep in mind that by definition, the only difference between no security and illusory security is your ignorance – not someone else’s.

That said, having the illusion of security is worse.

No Security

If you have no security, you could at least take steps to improve security.  Let’s restate the question to highlight the distinction:

Would you rather have no burglar alarm or have a burglar alarm that never works and tells you it does?

Although not having a burglar alarm won’t prevent you from making foolish decisions[3], at least you’ll have the opportunity to know you’re making a foolish decision.  Without a burglar alarm your decisions might be wise or foolish – but only accidentally so.

Illusory Security

Some would argue that the illusion of security provides a deterrence effect.  The only people who believe in the illusion of security is better are those who have something to gain by selling illusory security.[4]

  • First, deterrence is not a benefit of actual security.  Actual security depends upon the ability to actually stop something from occurring.  Deterrence is, at best, only a side-effect of actual security.  To the extent that actual security relies upon deterrence, its really just illusory security.  When good security is employed deterrence is either irrelevant or unnecessary.  Case in point:  If I have a good guard dog outside my house, I could care less what he looks like.
  • Second, as the above article suggests only stupid or careless criminals are deterred by illusory security.  Even the stupidest criminal knows that some people have actual security and other have only the illusion of security.  Don’t forget, if a criminal doesn’t care about whether you have actual or illusory security, then there is no deterrent effect.  If that same criminal cares whether you have illusory or actual security, then they’ll do the minimum to determine whether you have security.  If this hypothetical criminal instead who doesn’t know or care about illusory or actual security is stupid and will try out security measures.
  • Third, deterrent effects do not require illusory security.  Case in point:  If you know you don’t have a burglar alarm, there’s nothing preventing you from buying signs that say you do.  If deterrence is truly a worthy goal, then why not just opt for no security and specificallly develop the illusion of security.

Stupid Security

Why am I blathering on about security today?  I had an appearance at the Oakland WCAB on Monday afternoon.  As per the instructions of the security guard, I removed all metal from my person and placed it all in the plastic bin provided.  As I was about to walk through the metal detector, she pointed to my shirt pocket and asked what was in it.

Jay:  “Paper – see?”  I showed the parking lot ticket and a receipt from lunch.

Security Guard:  “Put that in too.”

Jay (giving a puzzled look):  “Why?  There’s nothing metal in it.  Its just paper.”

Security Guard:  “Just in case.”

I swear her response was, “Just in case.”  At this point I gave up.  There is little point in arguing with truly profound ignorance.

Just in case of what, exactly?

Just in case paper turns into metal?  Just in case I was hiding something in the paper I just showed her?  Isn’t that what metal detectors are supposed to find anyhow?

  1. Original photo courtesy of Daquella manera []
  2. “i” stands for an imaginary number.  :) []
  3. Such as going on vacation with the front curtains wide open showing off your 60″ plasma screen. []
  4. Call this a reductionist statement and ad hominem attack all you want.  But, you better back that up with an actual reason why illusory security is better than no security.  If you’ve got one, I’d like to see it. []

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