Report: Workers' comp medical costs soar - Memphis Business Journal:

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The research also found that those costs would have been billionxs more without system reforms earlieerthis decade. The Californiaw Workers’ Compensation Institute, a research organizationj made up of insurersand self-insured employers, recently releasec the study on post-reform changes in comp medical payments in the Golde n State. The study is the fourth in a five-partg series updating data on claim outcomes following systemm reforms between 2002and 2004.
All the data in the repor t reflect when injuriesoccurred — known as the accidentr year — instead of when an accident was Since 2005, insurance companies’ payments have increased significantly for medications/durable medical equipment, medical-legal reports and medical management, the institutse said. Between 2005 and average medical payments for all claims oneyear post-injuryg rose 23 percent, to $2,582 from $2,100, the studhy found.
Meanwhile, “average medical payments on more expensiv indemnity claims climbed 28percent (fromj $4,443 to $5,665),” the report Even though medical costs are rising, the reforms are estimatedx to have saved cumulatively between $12.9 billion and $25.3 billion in medica costs between 2004 and 2008. Some of the medicao management tools put in place by the reforms were medicalp treatmentutilization schedule, mandatorhy utilization review, bill review and medical providedr networks. The institute estimates that withoutthe reforms, comp medical inflation wouldr have continued at somewhere between 8.
2 perceng a year — which is half the pre-reforjm annual inflation rate — and 16.4 percent, which is the averagew annual inflation rate between 1999 and 2002.