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In-network costs lower except for back, shoulder comp injuries

medical costs

The average medical costs paid per claim are higher in-network for back and shoulder injuries compared with out-of-network claims, though lower for all other injuries, according to a study released Tuesday by the National Council on Compensation Insurance.

Boca Raton, Florida-based NCCI evaluated the impact of medical provider networks on workers compensation claim costs for 10 common workplace injuries. Currently, medical provider networks account for about 80% of workers comp medical services payments, and networks often set prices at amounts discounted below state physician fee schedules.

NCCI classified claims as in-network if at least 60% of evaluation and medical services were paid to in-network providers; claims with less than 40% paid in-network were considered out-of-network claims.

The ratings bureau found that although average paid medical costs were higher in-network for costly lumbar and rotator cuff tear injuries, in-network claims were less costly than out-of-network claims for the other injuries, including ankle/foot, hand/wrist, knee meniscus tear and neck pain injuries. In-network claims also tended to cost less for hospital outpatient services and resulted in fewer hospital admittances.

For in-network claims, the average total incurred cost for both permanent partial and temporary total disability claims for all 10 types of injuries tended to be lower or about the same as claims handled out-of-network, according to the study. Total incurred costs for in-network claims were 4% lower for PPD and 5% lower for TTD compared with out of network claims.

However, in-network claims were more likely to have permanent injury awards than out-of-network claims. NCCI speculated that this could be due to more serious injuries being referred directly to medical provider networks.