High Medical Costs Per Claim In Virginia
A recent study by WCRI indicates that the state of Virginia has one of the higher medical costs per Workers Compensation lost time claim. WCRI’s recent study included 16 states. Virginia’s average medical cost per claim was 22% higher than the median state.
The reason for the high medical costs may be attributed to the fact that Virginia does not have a fee schedule. I am not inferring that any state without a fee schedule will have a high level of medical costs. In October 2009, I compared other states that did not have a fee schedules and found them to be much more expensive than states with fee schedules. Tennessee reduced its medical costs significantly by adding in a Workers Comp medical fee schedule.
I thought I would research Virginia’s medical costs even further. According to the NCCI in April 2011, Virginia’s medical costs were 23% higher than any of the states in the same region. The comparison by NCCI included Kentucky, Maryland, DC, and North Carolina.
I would have to agree with the WCRI’s overall conclusion -over time trends in medical prices are lower in states with fee schedules. I hope that Virginia will in the future follow Tennessee’s lead and enact a fee schedule. The results will be positive.
There is an old and unfounded rumor that any state that enacts a fee schedule will cause a reduction in the availability of medical care for Workers Compensation claims. I have never seen this occur in any of my research.
Most Workers Compensation medical payments are higher than the comparable group health figures. One of the main complaints that have now faded was workers compensation carriers and Third Party Administrators tend to pay slower than other lines of insurance.
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