Study Finds Penn. Workers’ Comp Gives More Services for Less Cost

A new study by the Workers Compensation Research Institute (WCRI) found that lower than average prices for medical services in Pennsylvania’s workers’ compensation system offset the higher utilization of medical services, keeping system costs down.

“The result is that the average costs of workers’ compensation claims for medical care in Pennsylvania are typical of the eight states analyzed.” The report, “The Anatomy of Workers’ Compensation Medical Costs and Utilization: Trends and Interstate Comparisons, 1996-1999,” examined the programs in California, Connecticut, Florida, Georgia, Massachusetts, Pennsylvania, Texas and Wisconsin, which account for 40 percent of the benefits paid in U.S. workers’ compensation systems, and identified where workers’ compensation medical dollars go and how costs and utilization differ in each state.

The WCRI found that in in Pennsylvania:
— Prices per service for claims with more than seven days of lost time are 17 percent lower than the median of the eight states.
— The number of medical services per claim is 18 percent higher than the other study states.
— Workers use hospitals more often compared to other states in the study.
— Hospitals provide more services per claim than is found in the median of the eight states.

The study also reported these additional conclusions.
–The average cost per medical claim of $5,277 in Pennsylvania was almost the same as the eight-state median claim cost of $5,334.
— The average claim for Pennsylvania is characterized by a higher than typical number of services per claim – both higher visits per claim and services per visit – coupled with a lower average payment per service.
— Average medical payments per claim are lower than the eight-state median for physicians and hospitals, but higher than the median for chiropractors and physical therapists.
— The higher average per claim payments to chiropractors and physical therapists result from more visits and somewhat more services per visit, not from higher prices.
— The lower payments per claim to doctors and hospitals are strictly a function of lower prices per service. Hospitals bill for, or are used to provide more services in Pennsylvania than the eight-state median
— Hospitals in the state bill for new patient visits, physical medicine, radiology and hospital facility services in 18 to 53 percent more claims than is typical among the study states.
— Chiropractors and physical therapists are involved in fewer claims than the typical study state for more serious injuries, those with more than seven days of lost time. However, when involved they provide more visits and more services per visit than is typical.
— On the other hand chiropractors in Pennsylvania are involved in far more claims than their counterparts in other states in the study for claims with less than or equal to seven days of lost time.