WCRI Studies Look at Workers Compensation Medical Costs in 18 States

A new set of studies from the Workers Compensation Research Institute (WCRI), CompScope™ Medical Benchmarks, examine trends in payments, prices, and utilization of medical care for workers injured on the job in 18 states. The studies analyze costs and trends, reporting how medical payments per claim and cost components vary over time and from state to state.

They cover the period from 2012 through 2017, with claims experience through March 2018. The 18 states examined by WCRI―Arkansas, California, Florida, Georgia, Illinois, Indiana, Iowa, Louisiana, Massachusetts, Michigan, Minnesota, New Jersey, North Carolina, Pennsylvania, Tennessee, Texas, Virginia, and Wisconsin―represent more than 60 percent of the nation's workers compensation benefit payments. Individual reports are available for every state except Arkansas and Iowa.

"The reports are useful to identify where medical cost and care patterns may be changing," said Ramona Tanabe, executive vice president and counsel for WCRI. "They also help identify where medical payments per claim or utilization may differ from other states."

The following are sample findings for some of the study states.

• California—California saw moderate growth in medical payments per claim with more than 7 days of lost time in 2017 after a decrease following the implementation of Senate Bill (SB) 863. Other policy changes that may influence the recent trends in California include two major fraud-fighting measures—Assembly Bill (AB) 1244 and SB 1160, the drug formulary required by AB 1124—and multiple medical fee schedule updates.
• Florida—Medical payments per claim in Florida have been typical of 18 states, a result masking the lowest prices paid for nonhospital professional services and higher-than-typical payments per claim for ambulatory surgery centers (ASCs) and hospital outpatient and inpatient services. These results were mainly related to fee regulations in the state.
• Illinois—The average medical payment per claim with more than 7 days of lost time in Illinois was more than 15 percent higher than the median of 18 states studied for claims at 12 months of experience. This result reflects a combination of higher prices paid for many professional services and higher utilization of medical services than in other study states.
• Minnesota—Medical payments per claim in Minnesota remained stable from 2012 to 2017. Several trends offset one another to produce these stable results. For example, hospital inpatient payments per episode decreased following the 2016 inpatient fee schedule change, while ASC and hospital outpatient facility payments per claim increased.
• North Carolina—Medical payments per claim in North Carolina decreased 5 to 7 percent per year since 2014. These decreases likely reflect 2015 Medicare-based fee schedule changes for hospitals, ASCs, and nonhospital (professional) services.
• Wisconsin—Medical payments per claim in 2017 increased following 2 years of little change. The growth stemmed from several underlying factors—a larger recent increase in workers compensation medical prices paid for nonhospital care, an increase in hospital outpatient payments per service, and an increase in medical payments for inpatient episodes, especially surgical.