Cambridge, MA, Oct. 19, 2021 – Medical payments per workers’ compensation claim with more than seven days of lost time have been fairly stable in California since 2015, according to a recent study by the Workers Compensation Research Institute (WCRI). Compared with other study states, medical payments per all paid claims in California were 11 percent lower than the 18-state median for 2017 claims, evaluated as of 2020.
The recent stability in California medical payments per claim followed decreases after the implementation of the comprehensive reforms contained in Senate Bill (SB) 863, which went into effect in January 2013.
The study, CompScope™ Medical Benchmarks for California, 22nd Edition, compared California with workers’ compensation systems in 17 other states. For the study, WCRI analyzed workers’ compensation claims with experience through 2020 for injuries that occurred in years up to and including 2019.
“One area where California really stands out in this study is prescription drugs,” said Ramona Tanabe, executive vice president and counsel of WCRI. “Since 2013, California prescription payments per claim with prescriptions have decreased very rapidly, more than any of the other study states, which likely reflects several factors.”
The following are among the study’s other findings:
- The average nonhospital payment per claim has been fairly stable since 2015, decreasing 1 percent per year on average for claims at 12 months of experience. Following offsetting changes over the earlier part of the period, payments per claim for key nonhospital services were mostly stable after 2017.
- The average prescription payment per claim with prescriptions has decreased rapidly since 2013.As a result of decreases in California, as well as changes in other study states, California’s relative ranking compared with other study states shifted from being one of the highest of all states studied to the lowest. This may be related to the introduction of independent medical review by SB 863, changes to the Medi-Cal fee schedule, the application of treatment guidelines, the impact of the drug formulary, growing attention to the use of opioids in workers’ compensation, and the practice of disallowing physician dispensing in some medical provider networks.
- Payments per claim for hospital services grew moderately from 2015 to 2019, but the percentage of claims with hospital care decreased.
“Results from this study include experience on claims through March 2020, at the very beginning of the coronavirus (COVID-19) pandemic,” Tanabe said. “The study, therefore, provides a pre-COVID-19 baseline for evaluating the impact of the virus on workers’ compensation claims.”
To learn more about this study or to purchase a copy, visit https://www.wcrinet.org/reports/compscope-medical-benchmarks-for-california-22nd-edition. The report was authored by William Monnin-Browder.
The Cambridge-based WCRI is recognized as a leader in providing high-quality, objective information about public policy issues involving workers' compensation systems.
The Workers Compensation Research Institute (WCRI) is an independent, not-for-profit research organization based in Cambridge, MA. Organized in late 1983, the Institute does not take positions on the issues it researches; rather, it provides information obtained through studies and data collection efforts, which conform to recognized scientific methods. Objectivity is further ensured through rigorous, unbiased peer review procedures. WCRI's diverse membership includes 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.