(a) The executive director may establish by rule a premium credit program for certain employers. The program is applicable solely to regular subscribers to the workers' compensation fund and not to self-insurers. Participation in any premium credit program is voluntary and no employer is required to participate.

(b) The program applies a prospective credit to the premium rate of a subscribing employer who participates in a qualified loss management program. The prospective credit is given for a period of up to three years: Provided, That the employer remains in the program for a corresponding period of time.

(c) The rule shall specify the requirements of a qualified loss management program and shall include a requirement that a recognized loss management firm participate in the program. A loss management firm shall be recognized if it has demonstrated an ability to significantly reduce workers' compensation losses for its client employers by implementing a loss control management program. The amount of credit against premium rates that may be allowed by the executive director shall vary from firm to firm and shall be primarily determined by the loss reduction success experienced by all of the subscribing employers of the sponsoring loss management firm over a period of time to be determined by the executive director.

(d) A credit is applied to the employer's premium rate for up to three years. The amount of the credit applied to the first year is based on the credit factor assigned to the loss management firm on the date the employer subscribes to the program. The amount of the credit applied to the second and third years shall be based on the credit factor assigned to the loss management firm and in effect on each first day of July of the pertinent year: Provided, That the applicable credit is halved in the third year.

(e) The employer may terminate participation in the program upon three years of continuous participation in the program without penalty. Sooner termination may result in a penalty being applied to the employer's premium rate.

(f) An employer who has subscribed to an existing program of a qualified loss management firm prior to the effective date of this section is subject to a reduction in credit as follows:

(1) Participation for one year or less shall result in credit for the full three years;

(2) Participation for more than one year but less than two years shall result in a credit for two years;

(3) Participation for two years or more but less than three years shall result in a credit for one year; and

(4) Participation for three years or more shall result in no credit.

(g) This section shall not become effective until the board of managers promulgates an appropriate rule to implement this section's provisions.