Boca Raton, FL – NCCI recently released the third of four installments in a new series on inflation and workers’ compensation medical costs.
In today’s ever-changing environment, there is no shortage of questions on inflation and how medical costs may be impacted. In fact, workers compensation stakeholders indicate this is one of the top-of-mind issues they’re facing.
NCCI tackles this important subject in its new Inflation and Workers Compensation Medical Costs series in four parts addressing the key components of medical cost drivers: general overall medical costs, facility services, physicians, and prescription drugs.
The second installment examined how different types of facility services contribute to countrywide and regional facility cost trends in workers compensation by drilling down on price and utilization trends for different types of facilities and how each contributes to WC costs in the different US geographical regions.
Physician and facility services represent the bulk of medical expenditures in workers’ comp, and this third installment explores price and utilization trends in physician services and how each contributes to WC costs in four US geographical regions, with a focus on physician services and how evaluation and management (E&M), surgery, radiology, and physical medicine contribute to changes in WC medical costs. The article also provides state-specific results.
Key findings included:
- The average physician-paid cost per claim grew moderately from 2012 to 2021 at about 1.5% per year.
- Annual average physician payments by region varied modestly, increasing between 1.3% and 1.8%, with the Midwest and Northeast seeing the largest and smallest growth, respectively.
- Prices for physician services increased, which was the primary driver of growth in costs across regions.
- A change in utilization was the principal contributor to shifts in costs for surgeries and physical medicine services, with surgery use decreasing while physical medicine use increased.
- Physical medicine services were the most prominent contributor to the increase in physician costs across all regions.
The report was authored by Raji Chadarevian, Executive Director-Actuarial Research, and David Colon-Assistant Actuary.
Read the free report: NCCI Inflation and Workers Compensation Medical Costs Part 3 – Physician Services