CAMBRIDGE, MA,–WorkCompWire– October 27, 2010 – Medical costs per claim for workers’ compensation claims in Pennsylvania were typical compared with other states, a Workers Compensation Research Institute (WCRI) study said.
The Cambridge, Mass.-based WCRI reported that the combination of lower prices paid, but higher utilization, especially for physical medicine, drove Pennsylvania’s typical ranking for medical payments per claim compared to the 14 other study states, based on claims with 12 months of experience and greater than seven days of lost time.
The study, CompScopeTM Medical Benchmarks for Pennsylvania, 10th Edition, reported that most major nonhospital services in Pennsylvania had prices paid below the median state. In addition, the average payment per service for hospital outpatient services was lower than the median state.
However, when utilization was analyzed, the study found that Pennsylvania had higher utilization of nonhospital services, with physical medicine having the highest utilization of all of the services. Nonhospital physical medicine utilization was 58 percent above the median state, according to the study.
The study noted that hospital outpatient utilization, measured by the number of services per claim, was fairly typical with the exception of physical medicine, whose usage was 77 percent greater than the median state.
The study found that Pennsylvania had a higher percentage of claims with hospital outpatient care. In 2007, 76 percent of claims experienced hospital outpatient care – higher than most other study states.
Pennsylvania had higher utilization for nonhospital physical medicine driven by more visits per claim – 25, compared to the median state which had 18 visits per claim. The higher number of physical medicine visits per claim was driven by all providers, with physical/occupational therapists, physicians and chiropractors ranked with the highest number of visits per claim in Pennsylvania compared to the other study states.
Medical costs per claim in Pennsylvania grew by eight percent during the 2002 – 2007 study period, compared to the 15-state median of five percent.
Payments per claim rose eight percent for nonhospital providers and six percent for hospital providers over most of the study period.
The study pointed out that growth in payments to nonhospital providers was driven by utilization, more than price. At the same time, increases in hospital outpatient payments per claim were driven by growth in payments per claim.
The Workers Compensation Research Institute is a nonpartisan, not-for-profit membership organization conducting public policy research on workers’ compensation, healthcare and disability issues. Its members include employers, insurers, insurance regulators and state administrative agencies in the U.S., Canada, Australia and New Zealand as well as several state labor organizations.