The Company is liable under the Federal Mine Safety and Health Act of 1969, as subsequently amended, to provide for pneumoconiosis (occupational disease) benefits to eligible employees, former employees and dependents. The Company currently provides for federal claims principally through a self-insurance program. The Company is also liable under various state workers’ compensation statutes for occupational disease benefits. The occupational disease benefit obligation represents the present value of the actuarially computed present and future liabilities for such benefits over the employees’ applicable years of service.

In October 2019, the Company filed an application with the Office of Workers’ Compensation Programs (“OWCP”) within the Department of Labor for reauthorization to self-insure federal black lung benefits. In February 2020, the Company received a reply from the OWCP confirming its status to remain self-insured contingent upon posting additional collateral of $71.1 million within 30 days of receipt of the letter. The Company is currently appealing the ruling from the OWCP and has received an extension to self-insure during the appeal process. The Company is evaluating alternatives to self-insurance, including the purchase of commercial insurance to cover these claims.

In addition, the Company is liable for workers’ compensation benefits for traumatic injuries which are calculated using actuarially-based loss rates, loss development factors and discounted based on a risk free rate of 1.47%. Traumatic workers’ compensation claims are insured with varying retentions/deductibles, or through state-sponsored workers’ compensation programs.

(1)

In accordance with the adoption of ASU 2017-07, “Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,” these costs are recorded within Nonoperating expenses in the Consolidated Statements of Operations on the line item “Non-service related pension and postretirement benefit costs.”

The table below reconciles changes in the occupational disease liability for the respective period.


	Year Ended		Year Ended
	December 31,		December 31,
(In thousands)	2021		2020
Beginning of period	$	183,001	$	158,325
Service cost		7,796		7,564
Interest cost		4,439		5,115
Actuarial (gain) loss		(21,245)		19,327
Benefit and administrative payments		(6,406)		(7,330)
	$	167,585	$	183,001

The following table provides the assumptions used to determine the projected occupational disease obligation:


	Year Ended December 31, 2021	Year Ended December 31, 2020
(Percentages)
Discount rate	2.82	2.48

The higher discount rate decreased obligations by $11.6 million.

Summarized below is information about the amounts recognized in the accompanying Consolidated Balance Sheets for workers’ compensation benefits:


	Year Ended		Year Ended
	December 31,		December 31,
	2021		2020
(In thousands)
Occupational disease costs	$	167,585	$	183,001
Traumatic and other workers’ compensation claims		70,722		76,953
Total obligations		238,307		259,954
Less amount included in accrued expenses		14,202		15,259
Noncurrent obligations	$	224,105	$	244,695

As of December 31, 2021, the Company had $120.7 million in surety bonds, letters of credit and cash outstanding to secure workers’ compensation obligations.

As of December 31, 2021, the Company’s recorded liabilities include $13.1 million of obligations that are reimbursable under various insurance policies purchased by the Company. These insurance receivables are recorded in the balance sheet line items “Other receivables” and “Other noncurrent assets” for $0.6 million and $12.5 million, respectively.

The following represents expected future payments:



Year	(In thousands)
2022	$	12,525
2023		12,883
2024		12,997
2025		13,318
2026		13,595
Next 5 years		33,849
	$	99,167