California Workers Comp Costs Growing Quickly - Workers Compensation Audit and Mod Reviews For Employers
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Feb 1, 2012

California Workers Comp Costs Growing Quickly

I was perusing an article from the Workers Compensation Action Network that contained a few astounding statistics. If you are in CA or want to see what your Workers Comp situation may look like in a few years, it is a good website. I receive their email updates frequently.

Why is CA so important for Workers Comp Statistics? As I have posted many times in the past, what happens in California will be coming to your state very soon if it has not already affected your premiums.

According to the California Workers’ Compensation Institute, individual medical costs per claim between 2005 and 2009 grew by the following amounts:
  • 149 percent increase for physician medical-legal reports
  • 68 percent increase for pharmaceuticals and medical equipment*
  • 29 percent increase for physician ―evaluation and management,‖ driven by more doctors’ office visits and more treatments per visit
  • 23 percent increase for all outpatient services
  • 15 percent increase for physical medicine
  • 9 percent increase for surgery costs
The increase in pharmaceutical costs has included a dramatic increase in the prescribing of ―schedule II opioids‖ – narcotics such as oxycodone – and ―compound drugs‖ that include medical foods. Between 2005 and 2009, according to CWCI research, reimbursements for Schedule II drugs increased from 3.8 percent to 23.6 percent of total prescription drug payments in the California workers’ compensation system – an increase of more than 500 percent.

Recent research has found that more than half of these drugs are prescribed by less than three percent of medical providers in California. These providers collect nearly two-thirds of all reimbursements for these drugs. During the same time period, prescribing of compounds, the most common of which are mixtures of topical creams, grew from 2 percent of all workers’ compensation prescription costs in 2006 to 12 percent in 2009 – an increase of more than 400 percent.

This post on Fentanyl in California was a shocker to me. This is a large amount of statistics to digest. Do you track your Workers Comp payouts in this depth - especially on RX's?


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