As policymakers consider implementing or revising medical fee schedules to control costs in their state workers’ compensation systems, this new study highlights the critical design choices involved in adopting, updating, and reforming these schedules.

Crafting a medical fee schedule requires a delicate balance. If rates are set too low, treating injured workers may become uneconomical for providers, jeopardizing access to care. Conversely, rates set too high may reduce potential savings and weaken the fee schedule’s cost-containment goals.

This study outlines the key decisions public officials face when establishing or revising physician fee schedules. It examines how 44 states with fee schedules and the District of Columbia have addressed these challenges as of March 31, 2025, and analyzes major changes to professional medical service fee schedules since March 2022—particularly in light of elevated inflation in the broader economy.

It also compares fee schedule levels across states for professional services, which account for about 41 percent of workers’ compensation medical costs. The study does not assess whether rates are appropriate or explore broader policy impacts, such as access to care or patterns of medical utilization

Designing Workers’ Compensation Medical Fee Schedules, 2025. Olesya Fomenko and Te-Chun Liu. June 2025. WC-25-41.

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Copyright: WCRI