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APPEAL WORKMEN'S COMPENSATION RATE CLASSIFICATION LONGWOOD VILLA NURSING AND CONVALESCENT HOME. COMMONWEALTH PENNSYLVANIA INSURANCE DEPARTMENT. LONGWOOD VILLA NURSING AND CONVALESCENT HOME (10/21/76)

decided: October 21, 1976.

IN RE: APPEAL OF WORKMEN'S COMPENSATION RATE CLASSIFICATION OF LONGWOOD VILLA NURSING AND CONVALESCENT HOME. COMMONWEALTH OF PENNSYLVANIA INSURANCE DEPARTMENT. LONGWOOD VILLA NURSING AND CONVALESCENT HOME, APPELLANT


Appeal from the Order of the Insurance Commissioner of the Commonwealth of Pennsylvania in case of Appeal of Workmen's Compensation Rating Classification of Longwood Villa Nursing and Convalescent Home, Docket No. WC-75-4-2.

COUNSEL

Charles O. Barto, Jr., with him Killian & Gephart, for appellant.

John H. Isom, Assistant Attorney General, with him Gerald Gornish, Deputy Attorney General, and Robert P. Kane, Attorney General, for appellee.

President Judge Bowman and Judges Mencer and Blatt, sitting as a panel of three. Opinion by Judge Mencer.

Author: Mencer

[ 26 Pa. Commw. Page 622]

Longwood Villa Nursing and Convalescent Home (Longwood) has appealed from the Insurance Commissioner's order dismissing its appeal from a workmen's compensation rate reclassification by the Pennsylvania Compensation Rating Bureau (Bureau).

In a letter dated March 6, 1975, the Bureau informed Longwood of its decision to change Longwood's classification from Code 961 (hospitals) to Code 974 (orphanages and homes for the aged). A result of this reclassification is that Longwood's premium for workmen's compensation insurance increased approximately threefold. The Insurance Commissioner dismissed Longwood's appeal for want of jurisdiction to entertain it because of our holding in Commonwealth of Pennsylvania, Insurance Department v. Colonial Gardens Nursing Home, 22 Pa. Commonwealth Ct. 119, 347 A.2d 770 (1975). In Colonial we held that the Insurance Commissioner has no jurisdiction to review the Bureau's assignment of an individual employer to any particular risk classification.

Longwood does not challenge the applicability of that ruling to this case but urges us to reconsider our decision made in Colonial. Although we have had the benefit of an excellent brief and thorough argument by counsel for Longwood and have carefully reviewed our reasoning expressed in Colonial, we are not persuaded to alter the holding made therein.

Our reexamination of Section 654 of The Insurance Company Law of 1921, Act of May 17, 1921, P.L. 682, as amended, 40 P.S. ยง 814, leads us again to conclude that it was intended only to regulate the

[ 26 Pa. Commw. Page 623]

    formulation of a system of classifications and premium rates which reflects the different casualty experiences of different types of employers. As we concluded in Colonial, there is no requirement that the Commissioner approve the assignment of an individual employer to any particular risk classification nor that the Commissioner review such an assignment, once it is made.*fn1

Longwood raises here the additional issue that the Bureau is a non-governmental group consisting of representatives of various insurance companies and that its functions and operations violate the Constitution of the Commonwealth of Pennsylvania and the Constitution of the United States of America. It is asserted that support for this contention is to be found in Hetherington v. McHale, 458 Pa. 479, 329 A.2d 250 (1974), and Olin Mathieson Chemical Corp. v. White Cross Stores, Inc., 414 Pa. 95, 199 A.2d 266 (1964). We find Longwood's reliance on these decisions to be misfounded. In Hetherington, the committee, comprised in part of non-governmental appointees, was responsible for the disbursement of public funds. In the instant case, the non-governmental group has no such power but is only to formulate a system of risk classifications and corresponding premium rates which shall not take effect without the consent or approval of the Insurance Commissioner. In ...


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