Disparities found in workers’ compensation hospital outpatient costs

The Workers Compensation Research Institute (WCRI) released a new study yesterday, the Hospital Outpatient Cost Index for Workers’ Compensation, 2nd Edition, to provide policymakers and system stakeholders with a tool to:

  • identify and better understand the implications of different types of fee regulations on hospital outpatient costs
  • compare hospital outpatient costs across states
  • identify potential key cost drivers
  • monitor the impact of reforms

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The study found that states with hospital outpatient fee regulations based on a percent of charges had higher costs compared to states with fixed-amount fee schedules that assign specific reimbursement amounts for each procedure or group of procedures. Florida, Louisiana, Minnesota and North Carolina mainly base hospital outpatient services related to surgeries on percent of charges. In the study, costs in these states were 61 to 91 percent higher than the median among study states with fixed-amount fee schedules. The study also found states without fee schedules for hospital outpatient reimbursement had higher hospital costs for common surgeries compared to states with fixed fee schedules.