State medical fee schedule levels, Medicare rates differ
There are significant differences among the workers' compensation medical fee schedule levels in the 43 states that use them compared to the Medicare fee schedule levels across the states, according to a recent study.
The report, by the Workers Compensation Research Institute, provided policymakers with critical benchmarks for the design of fee schedules in workers' comp systems by analyzing the relative levels of state workers' comp medical fee schedules. According to the study, the construction of a workers' comp medical fee schedule requires a delicate balance. Researchers said if rates are set too high, the fee schedule may not meet its cost-containment goal. If rates are too low, access to quality care for injured workers may be jeopardized.
For the study, each state's Medicare fee schedule was used as a benchmark, recognizing that the optimum level of fee schedule rates was likely not the same as Medicare. Researchers said using the Medicare fee schedule allowed evaluation of the relationship between fee schedule rates and the provider expenses of delivering care.
The study found that the premium over Medicare varied from 8 percent above Medicare in Massachusetts to 215 percent above Medicare in Alaska. WCRI also found that nine states set rates that resulted in the premium over Medicare being relatively the same for each of the service groups, which researchers said may neutralize incentives for over-utilization of invasive and specialty care. In addition, the study found higher workers' comp rates were not necessarily correlated with higher Medicare rates.
Researchers found that:
- Three states -- California, Florida and Massachusetts -- set workers' comp fee schedule rates within 20 percent of Medicare rates at the state level.
- Just over one-half of the states set workers' comp fee schedule rates between 50 and 100 percent above the Medicare rate at the state level.
- Six states -- Alaska, Delaware, Idaho, Illinois, Nebraska and Oregon -- set their workers' comp fee schedule rates at levels more than double Medicare at the state level.
Read more at the WorkersComp Forum homepage.
September 30, 2010
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