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From:
Risk & Insurance
December 1, 2009
Florida:
Medical Costs Driven by Increase in Payments per Service, Report
Finds
Medical costs per
workers' compensation claim in Florida have grown in recent years
after stabilizing following the enactment of comprehensive reforms
in 2003, according to a study.
The report by
the Workers Compensation Research Institute found that
medical costs per claim grew at a rate of 5 to 7 percent annually in
2005 and 2006 after slowing for a period immediately following the
reforms. The legislation affected many aspects of the workers' comp
system in the state, including a change in fee schedule rates.
The study,
Monitoring the Impact of 2003 Reforms in Florida: CompScopeTM
Medical Benchmarks, 9th Edition, analyzed claims with experience
as of March 2007. Researchers found that the 5 percent growth in
medical costs per claim in the most recent study year 2006 was
mainly driven by the significant increases in the average payment
per service for hospital outpatient services. Previously in 2004,
the average payment per service for most hospital outpatient
services decreased at double-digit rates.
Researchers
pointed out that changes in the fee schedule rates for most hospital
outpatient services in 2004 and the corresponding adjustment of the
parties in the system -- providers, injured workers, and payors --
may be related to the decrease in 2004 and the increase in 2006. In
November 2008, Florida's three-member panel that determines changes
to the state's fee schedule approved a new schedule for hospital
outpatient charges that adjusts the Medicare-based fees by a
hospital's usual and customary charges. WCRI officials said future
research of Florida's comp system will monitor the impact of this
change on medical costs.
Report
highlights.
Among the highlights of the study, researchers found that:
·
Prices for
surgeries decreased after increasing post-reform. The study reported
that prices paid for surgeries decreased 9 percent in 2006 after
jumping in the prior two years following the fee schedule increase
in 2004. Because of the decrease, researchers said the prices paid
in 2006 for many of the most commonly billed surgeries -- especially
arthroscopic surgeries -- were closer to the fee schedule rates,
although still higher.
The study also noted that prior to the reforms, the prices paid for
surgeries in the state were often negotiated at much higher levels
than the fee schedule rates, which were among the lowest nationwide.
·
Physical
medicine services drove increases in 2005. The study also noted that
in 2005, medical costs per claim grew 7 percent in Florida. A main
driver of that growth was the increases in prices paid for physical
medicine services provided by chiropractors and
physical/occupational therapists, which researchers said may be tied
to the fee schedule increases in May 2005.
The 2003 reforms also increased the maximum number of visits allowed
for chiropractor care. The average number of visits per claim to
chiropractors had a small increase (from 12 to 13 visits) from 2003
to 2004, and then fell to 11 visits in 2005 and 2006. Compared to
other states in the study, researchers said the average number of
visits per claim to chiropractors in Florida was fairly typical.
However, chiropractors were involved in fewer claims in Florida than
in most other states.
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