Report: Texas Reforms Reduced Costs of Medical Care for Injured Workers

A new study from the Workers Compensation Research Institute (WCRI), an independent, not-for-profit research organization based in Cambridge, Mass., says that costs of medical care for injured workers in Texas have dropped. The study says the drop is largely the result of reforms and an increased focus and effort on managing medical care in the state’s workers’ compensation system.

“This study is a valuable tool for policymakers and other stakeholders who are looking to better understand and break down the impact of reforms to the Texas workers’ compensation system as well as compare their medical costs to other states,” said Ramona Tanabe, deputy director and counsel.

The study, Monitoring the Impact of Reforms in Texas, CompScope Medical Benchmarks, 12th Edition, found that medical payments per workers’ compensation claim in Texas were now lower than the median of 16 states in the study. Prior to the passage of reforms in 2001 and 2005, medical payments in Texas were the highest and fastest growing compared with other study states.

According to the study, a significant decrease in the utilization of medical services by nonhospital providers, such as chiropractors and physical/occupational therapists, was the primary factor behind the drop in medical costs per claim.

For example, the number of chiropractor visits per claim was cut by 64 percent from 2001 to 2009, the percentage of claims with chiropractic care was cut in half, and the average number of visits per claim to physical/occupational therapists also decreased.

The study further observed that utilization of medical services by nonhospital providers appears to have stabilized, which may signal that little further impact can be expected from reforms that focused on utilization of services.

The WCRI study also said that medical payments per claim in Texas rose for the second year in a row, mainly due to fee schedule increases in 2008. However, reimbursement for medical care in Texas was still lower than typical of the study states even after the fee schedule increases.

Source: Workers Compensation Research Institute (WCRI)