Medical Payments per Workers’ Compensation Claim Decreased in North Carolina; Fee Schedule Changes Cited
Cambridge, MA (WorkersCompensation.com) - Medical payments per claim in North Carolina decreased 5 to 7 percent per year since 2014, according to a recent study by the Workers Compensation Research Institute (WCRI). These decreases likely reflect fee schedule changes for hospitals and ambulatory surgery centers (ASCs) and for nonhospital (professional) services.
A set of 2015 reforms targeted a key cost driver of workers' compensation claims in North Carolina—hospital costs. Fee schedule rules set reimbursement for medical care based on a percentage of Medicare. Phased-in decreases in reimbursement for hospitals and ASCs went into effect beginning in April 2015, while changes in reimbursement for nonhospital (professional) services became effective in July 2015.
“Medical payments per claim decreased 5 percent per year from 2012 to 2017 for claims with more than seven days of lost time at 12 months of experience—more than in any other state during that period,” said Ramona Tanabe, executive vice president and counsel of WCRI.
The average medical payment per claim in North Carolina was 28 percent lower than the median of the 18 states studied for 2017 claims with more than seven days of lost time at an average of 12 months of experience. Prior to the new fee schedule rules, medical payments in North Carolina were similar to the median state.
Among the study's other findings:
Nonhospital prices paid overall increased 8 percent per year from 2014 to 2016, with variation by type of service. There was little change in prices paid in 2017 and 2018.
Other observed effects following the adoption of the Medicare-based fee schedules included decreases in ASC facility payments per claim and in hospital payments per inpatient episode.
From 2014 to 2017, the percentage of medical payments for care in networks increased.