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California comp report shows drop in medical costs

Posted On: Jul. 2, 2019 12:00 PM CST

California

Total insurer combined losses and expenses incurred by workers compensation payers in California in 2018 were $14.3 billion, or 82% of calendar year premium, compared with $16.2 billion, or 92% of calendar year premium, in 2017, according to a report released Monday by the Oakland, California-based Workers' Compensation Insurance Rating Bureau of California.

The report, prepared annually pursuant to state law, also revealed that payers funded less medical costs overall and in every category of care with the exception of medical payments made directly to the injured worker, paying $1.47 billion in 2018, compared with $1.34 billion in payments issued in 2017.

Medical losses paid in 2018 were $4.6 billion, or 55% of total loss payments, and $.1 billion less than that paid in 2017, according to the report. Of these payments, in addition to that paid to injured workers, $1.2 billion was paid for physician services, $0.6 billion for inpatient or outpatient services, $0.1 billion for pharmaceuticals and $0.3 billion for medical-legal evaluations — all representing small drops in costs.

Meanwhile, the total cost of medical cost containment programs in 2018 was $426 million, compared with $443 million in 2017, according to the report.

Indemnity benefits paid in 2018 were $3.8 billion, or 45% of total loss payments, and a slight increase over the $3.7 billon spent in 2017, according to the report and the 2017 report. Of the amount paid in 2018, temporary disability benefits paid totaled $1.8 billion and permanent partial disability benefits paid totaled $1.5 billion, the report shows.