North Carolina Medical Payments per Workers’ Compensation Claim Stable, Finds WCRI Study

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This study by the Workers Compensation Research Institute (WCRI) examines medical payments, prices, and utilization in North Carolina and compares them with 17 other states (Arkansas, California, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, New Jersey, Pennsylvania, Texas, Virginia, and Wisconsin).

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Hospital costs had been a key driver of medical payments per claim in North Carolina and prices paid to nonhospital providers were lower than typical. Administrative and legislative changes since 2013 addressed those issues.

Medical payments per workers’ compensation claim in North Carolina changed little after 2009, according to an 18-state study by the Workers Compensation Research Institute (WCRI), following growth averaging 6 and 7 percent per year from 2004 to 2009 at all claim maturities.

The study, CompScope™ Medical Benchmarks for North Carolina, 17th Edition, attributed the change in trends to several factors, including a decrease in hospital payments per claim.

“That decrease likely reflects, in part, 2013 interim changes in the state’s fee schedules,” said Ramona Tanabe, WCRI’s executive vice president and counsel. “Hospital costs had been a key driver of medical payments per claim in North Carolina and prices paid to nonhospital providers were lower than typical. Administrative and legislative changes since 2013 addressed those issues.”

House Bill 92, passed in 2013, required that reimbursement for all workers’ compensation medical care be based on Medicare methodology. Proposed fee schedule rules were published in November 2014 and were approved in February 2015. Phased in decreases for hospitals and ambulatory surgery centers (ASCs) went into effect in April 2015, and changes in reimbursement for professional services went into effect in July 2015. Future WCRI studies will monitor the effects of those changes.

The following are among the study’s other findings:

  • Prices paid for most nonhospital services changed little, and utilization of some medical services decreased.
  • Medical payments per claim in North Carolina were typical of the 18 states studied, though that differed by provider. Hospital payments per claim were higher than in many states, while nonhospital costs per claim were lower than typical.

WCRI studied medical payments, prices, and utilization in 18 states, including North Carolina, looking at claim experience through 2015 on injuries that occurred mainly in 2009 to 2014. WCRI’s CompScope™ Medical Benchmark studies compare payments from state to state and across time. Copies of this report can be ordered from the WCRI web site: http://www.wcrinet.org/studies/public/books/csmed17_NC_book.html.

The Cambridge-based WCRI is recognized as a leader in providing high-quality, objective information about public policy issues involving workers' compensation systems.

ABOUT WCRI:

The Workers Compensation Research Institute (WCRI) is an independent, not-for-profit research organization based in Cambridge, Massachusetts. Since 1983, WCRI has been a catalyst for significant improvements in workers' compensation systems with its objective, credible, and high-quality research. WCRI's members include employers; insurers; governmental entities; managed care companies; health care providers; insurance regulators; state labor organizations; and state administrative agencies in the U.S., Canada, Australia, and New Zealand.

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Andrew Kenneally
Workers Compensation Research Institute - WCRI
since: 06/2011
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