CAMBRIDGE, MA, December 10, 2010 – Medical payments per workers’ compensation claim in Louisiana were higher than most study states, largely the result of higher utilization and higher prices paid for services that are commonly delivered in the majority of claims – office visits, diagnostic tests, X rays, and physical medicine, according to a study from the Workers Compensation Research Institute (WCRI).
The study, CompScopeTM Medical Benchmarks for Louisiana, reported that the state’s ranking moved higher relative to the 14 other states in the study, in part because of medical-focused reforms in several study states.
Legislation passed in Louisiana in 2009 that required the use of evidence based medical treatment guidelines, established a medical advisory council, authorized hiring a medical director, and required developing a new approach to resolving medical disputes may help provide an opportunity to reduce some unnecessary utilization of medical services and deliver needed care faster, WCRI said.
WCRI reported that medical costs per claim in Louisiana grew 5 percent per year from 2005 to 2007, but had been relatively stable in prior years. This rise was largely the result of higher payments to hospitals, on both the inpatient and outpatient sides.
For all claims, medical costs per claim in Louisiana were 37 percent higher than typical of the study states. For claims with more than seven days of lost time, medical costs per claim in Louisiana were 20 percent higher than the median of the study states.
The study reported that an important driver of higher medical payments per claim was higher utilization for some services, such as more intensive or invasive care than in the typical study state.
For example, in Louisiana there were 17 percent more visits per claim to physical/occupational therapists and 17 percent more visits for evaluation and management services per claim with these services than in the typical state.
More cases in Louisiana involved diagnostic services, with somewhat more visits per claim. Nearly 80 percent of claims involved at least one minor radiology procedure (such as X rays and ultrasounds) compared to 73 percent for the typical study state, and 45 percent of claims involved major radiology (CT scans and MRIs) compared to 39 percent in the typical state.
In addition, nearly 12 percent of claims with more than seven days of lost time involved an inpatient stay in Louisiana, highest among the study states and compared to 9 percent in the median study state.
Injured workers in the state received medical treatment for a longer time than in other study states. For example, the study noted that the average duration of medical treatment was 45 weeks in Louisiana, about 6 weeks longer than in the typical study state. Similarly, the duration of physical therapy treatment was 25 weeks in Louisiana, compared to 22 weeks in the median study state.
A key reason for the higher medical payments per claim was higher prices paid to nonhospital providers. The study pointed out that even though the Louisiana fee schedule has not significantly changed rates since 1994, prices paid were higher for some services and typical for others.
Prices paid for many physician, chiropractic, and physical therapy services were higher than typical. For example, prices paid for minor radiology services and physical medicine were 14 to 16 percent higher than in the median study state, consistent with the higher-than-typical fee schedule rates for those service groups.
The Cambridge, Mass.-based WCRI observed that recent policy debates have revolved around the fee schedule and the tools that payors have to manage medical care and costs. WCRI noted that the information in the new study may be helpful to policymakers as they consider ways to implement the new requirements.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.
955 Massachusetts Avenue Cambridge, Massachusetts 02139 617-661-WCRI (9274)