New WCRI Study Helps Policymakers Design Medical Fee Schedules

Cambridge, MA (WorkersCompensation.com) - As policymakers from across the country search for ways to contain rising medical costs in the workers' compensation arena, one tool that is often considered is a medical fee schedule.

Since the construction of a medical fee schedule involves a delicate balance of tradeoffs, the Workers Compensation Research Institute (WCRI) has released a new study to help policymakers who are looking to adopt, reform or update the medical fee schedule in their state workers' compensation system.

The study, Designing Workers' Compensation Medical Fee Schedules, provides essential information on how each of the 43 states with workers' compensation physician fee schedules resolved critical fee schedule design decisions that often become a center of intense policy debates.

According to the study, the fee schedule level is crucial. If fee schedule rates are set too high, savings will be negligible and the fee schedule will not achieve its cost containment goal. Conversely, setting rates too low makes treating injured workers uneconomical for providers and jeopardizes workers' access to quality care.

The study highlights some of the most important design choices that public officials face in adopting, reforming, and updating a fee schedule, such as how high or low the fee schedule level should be set and whether the state should use a single fee schedule for the entire state or have different fee schedules for different regions. The study also discusses a number of technical choices that all policymakers have to face.

Additionally, the state- and service group-level comparisons of the workers' compensation fee schedules answer a common question that policymakers and stakeholders ask: “How does my state compare to other states?”

“If you are a policymaker or other stakeholder and you are considering adopting, reforming, or updating a medical fee schedule, this is the study for you. WCRI's study provides you with a ‘do it yourself guide' using real life examples from 43 fee schedule states,” said Dr. Olesya Fomenko, author and WCRI Economist.

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