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

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The research also found that those costz would have been billions more without system reformws earlierthis decade. The California Compensation Institute, a research organization made up of insurerdand self-insured employers, recently released the study on post-reform changex in workers’ comp medical payments in the Golden The study is the fourth in a five-par series updating data on claim outcomeds following system reforms between 2002 and 2004. All the data in the reporgt reflect when injuriesoccurred — known as the accidenrt year — instead of when an accidenrt was reported.
Since 2005, insurance companies’ payments have increase d significantlyfor treatment, medications/durable medical medical-legal reports and medical management, the institute said. Between 2005 and 2007, average medical payments for all claim s oneyear post-injury rose 23 to $2,582 from $2,100, the study found. Meanwhile, “average medical payments on more expensivwe indemnity claims climbed 28percent (from $4,442 to $5,665),” the report Even though medical costs are rising, the reforms are estimated to have savedx cumulatively between $12.8 billion and $25.3 billion in medical costs between 2004 and 2008.
Some of the medica management tools put in place by the reformas were medical treatmentutilizationn schedule, mandatory utilization review, bill reviewa and medical provider networks. The institutew estimates that withoutthe reforms, comp medical inflation would have continued at somewhere between 8.2 percent a year — whichh is half the pre-reform annualk inflation rate — and 16.4 percent, whichu is the average annual inflation rate between 1999 and 2002.