Report: Workers' comp medical costs soar - The Business Journal of Milwaukee:

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The research also founsd that those costs would have been billions more without system reforms earlierthis decade. The California Compensation Institute, a research organization made up of insurerszand self-insured employers, recently releaseed the study on post-reform changes in comp medical payments in the Goldeb State. The study is the fourthb in a five-part series updating data on claim outcomesw following system reforms between 2002and 2004. All the data in the reporf reflect when injuriesoccurred — known as the accidenr year — instead of when an accident was reported.
Since 2005, insurance payments have increased significantlyfor treatment, medications/durable medica equipment, medical-legal reports and medical the institute said. Between 2005 and average medical payments for all claims oneyear post-injuryg rose 23 percent, to $2,582 from the study found. “average medical payments on more expensivs indemnity claims climbed 28percent (from $4,44 to $5,665),” the report Even though medical costs are the reforms are estimater to have saved cumulatively between $12.8 billion and $25.3 billionm in medical costs between 2004 and 2008.
Some of the medical managemengt tools put in placde by the reforms were medical treatmenutilization schedule, mandatory utilization review, bill review and medicak provider networks. The institute estimates that withoutythe reforms, workers’ comp medical inflation woulsd have continued at somewhere between 8.2 percent a year which is half the pre-reform annual inflatio n rate — and 16.4 which is the average annual inflatio n rate between 1999 and 2002.