Opinion ID: 883077
Heading Depth: 1
Heading Rank: 3

Heading: The Underwriting Manual

Text: On May 6, 1991, State Fund published a Notice of Proposed Amendment of ARM 2.55.301, which prescribes the method of classifying occupations for the purpose of assessing workers' compensation rates. The proposed amendment incorporated by reference the Classifications section of the Underwriting Manual, effective July 1, 1991. This section is the only portion of the Underwriting Manual that State Fund has adopted formally as a rule. Patrick Sweeney adopted the amendment for the state fund on June 17, 1991. [1] MHCA requested a copy of the July 1991 Underwriting Manual in June but was told that it had not been prepared or printed and probably would not be available until September 1991. On July 8, MHCA was given a draft version of the revised classification section. This draft was not available to Patrick Sweeney when he adopted the amended rule on June 17. Comment on the proposed amendment was invited on May 6, but as the District Court pointed out, it was not possible at that time for an employer to know whether it was affected by the changes. As the District Court said, for an agency to adopt as a rule something which is not available for review and comment is directly contrary to the requirements of MAPA. We agree. Since State Fund adopted the classification section of the Underwriting Manual as a rule, it may amend that section only through the process described in Title 2, chapter 4, MCA. Appellants contend that the District Court should have required State Fund to adopt the General Rules section of the Underwriting Manual, which is incorporated in its insurance contracts, as a formal rule under MAPA, because this section implements and prescribes law and policy in ways that affect employers' substantive rights. State Fund argues that its insurance policy is a contract and that the General Rules section of the Underwriting Manual merely states some of the contract terms and does not implement, interpret, or prescribe law or policy. The District Court found that State Fund's failure to adopt the General Rules section of the Underwriting Manual in accordance with MAPA was not critical to this lawsuit, and that in any case State Fund is not required to adopt this section of the Underwriting Manual as a formal rule. Finding that the District Court interpreted MAPA correctly, we affirm.