Study offers benchmark to help establish 'appropriate' fee schedules
"This can help states better address the key questions, 'is the fee schedule likely to be too high or too low?' and 'if the fee schedule is reduced, would access to care likely be materially reduced?'"
Thus explains the reasoning behind yet another study comparing workers' comp with group health rates by the Workers Compensation Research Institute. Where the previous study addresses hospital services/payments, this report focuses on nonhospital services.
The study analyzes the median price paid for five common surgeries and four common established patient office visits in 22 states during 2009. In almost every state, the prices paid in the workers' comp system were higher than those paid by group health insurers for the same procedures.
"In a number of states, the workers' comp prices paid for common surgeries were two- to four-times higher than the prices paid by group health insurers in the same state," the study says. "In contrast, the prices paid for office visits under workers' comp were typically within 30 percent of the prices paid by group health insurers."
Knowing the group health rates can help policymakers set optimal fee schedules. As an example of how such data might have shaped the fee schedule debate in Illinois two years ago, the authors offer the following:
- The median price for a common knee surgery in workers' comp was $3,886 while in group health it was $997. The state adopted a 30 percent reduction to its fee schedule. "Assuming that the 30 percent reduction in the fee schedule produced a 30 percent reduction in the median price paid in workers' comp ... then the median workers' comp price paid would have fallen to $2,720 -- still 2.7 times the group health insurance price," the authors note. "A question for Illinois policymakers is whether such a large differential is necessary to induce Illinois surgeons to operate on injured workers."
- The median workers' comp price paid for a common office visit was $85 while the median group health price was $71. Reducing the workers' comp price by 30 percent would drop the price to $60. "Although this study does not measure access to care, policymakers might have wondered if workers' comp prices were below the group health prices, access to care, especially primary care, may have been impaired."
Elsewhere, the prices paid for office visits through the workers' comp system were at least 20 percent below the median group health price in 2009 in New York, North Carolina, and Massachusetts. New York is the only one that increased its fee schedule between 2009 and 2012.
"In a typical year, five to 10 states have significant public policy debates about enacting new fee schedules or making major revisions to existing ones to regulate prices paid in workers' comp," said Richard Victor, WCRI's executive director. "Often, the central question debated is how high or low the fee schedule rates should be."
By Nancy Grover
Read more at the WorkersComp Forum homepage.
August 5, 2013
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