Outpatient comp costs vary widely by state: WCRI

Workers compensation payments in states with fee schedules tied to Medicare tend to pay less for outpatient hospital care or treatment at ambulatory surgical centers than those without, according to the Workers Compensation Research Institute.

Researchers on Wednesday analyzed the impact of state workers comp fee schedules on outpatient facility reimbursement during Cambridge, Massachusetts-based WCRI’s virtual Annual Issues and Research Conference.

“States use different approaches to regulate reimbursement to facilities,” said Rebecca Yang, senior public policy analyst at WCRI. “There’s increasing interest among policymakers and stakeholders to understand the role of fee regulations on facility payments.”

Facility payments represent 15% or more of total workers comp medical payments in most study states, she said. In nine of the 18 states studied, payments to ambulatory surgical centers represented about half of all facility payments, according to WCRI research.

States with a fixed-amount fee schedule, in which reimbursement rates are assigned to each procedure or group of procedures — and are typically based on a percentage of Medicare reimbursement — generally had lower hospital outpatient payments than states with no fee schedule or a charge-based fee schedule, in which payments are based on a percentage of hospital charges or on a ratio reimbursement, she said.

Using research from 2018, the most recent data available, WCRI found that Alabama, which has a percent-of-charge-based fee schedule, paid 136% above the median for hospital outpatient claims that year.

Massachusetts, Nevada, New York, Oklahoma and West Virginia — all of which employ a fixed-amount fee schedule — paid about 50% less than the median state for hospital outpatient claims in 2018, with Nevada paying the lowest amount at about 66% below the median.