Where the Medical Dollar Goes? How California Compares to Other States

By Richard A. Victor, Stacey M. Eccleston

March 1, 2003 Related Topics:

At the request of the California Assembly Committee on Insurance, WCRI analyzed where the medical dollar goes in California compared to eleven other states. This study presents actual payments, not charges, to physicians, chiropractors, physical therapists and hospitals, but not to ambulatory surgery centers. The payments are not case-mix adjusted. As a result, some of the interstate differences could be due to differences in injury mix or industry mix.

Among our findings:

  • The average medical cost per claim in California was 23 percent higher than the median of the 12 large states. This result was due, in part, because California had a higher proportion of claims with more than seven days of lost time than most of the other study states.
  • Average payments per claim to California chiropractors were $2,066 (1999 injuries with experience through mid-2000), 148 percent higher than the median study state ($833) and 70 percent higher than the next highest state, Illinois ($1,215). The major driver of this difference was higher utilization.
  • Payments per claim to physicians in California ($835) were the third highest among the 12 states and 33 percent above the median of the 12 states ($629).
  • Physical therapists in California were involved in more than 28 percent of cases, compared to 20 percent in the median state in the study. Chiropractors were also involved in a higher percent of cases of all cases (5 percent) than the typical study state (3 percent).
  • Hospitals were involved in a much smaller percent of cases – 31 percent compared to 45 percent in the typical state in the study.

FlashReport: Where the Medical Dollar Goes?  How California Compares to Other States. Richard Victor and Stacey Eccleston. March, 2003. FR-03-03.

Copyright: WCRI

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