WCRI Medical Price Index for Workers' Compensation, Second Edition (MPI-WC)

In 2007, WCRI developed the first pure medical price index for workers' compensation to help policymakers and business decision makers identify states and medical services where medical prices are unusually high or low, or are rising rapidly. The index measures prices actually paid and is updated annually. This second edition covers the period from 2001-2006 and uses data from 25 large states that represent more than three-quarters of the benefits paid in the U.S. 

This study quantifies trends in workers' compensation medical price inflation, providing a useful tool that annually will help policymakers and business decision makers track price trends and evaluate the effectiveness of public policy initiatives. The index not only tracks changes in prices over time within a state, but makes interstate comparisons in actual prices paid for the latest year (in this edition, 2006). We exclude in this edition any services billed by hospitals or ambulatory surgery centers, as well as pharmaceuticals. 

Figure A presents the WC-Medical Price Index for calendar year 2006. Prices paid in the median state are equal to 100. An index of 120 means that the average prices paid are 20 percent higher than the median state. The 2006 figures should provide a reasonable approximation for a state’s current ranking relative to other states.

Figure A

The states in the second edition of the WCRI MPI-WC are Arizona, Arkansas, California, Connecticut, Florida, Georgia, Illinois, Indiana, Iowa, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, New York, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, and Wisconsin.