WCRI: Increasing Payments to Providers Does Not Necessarily Drive Better Outcomes

Nancy Grover

Cambridge, MA (WorkersCompensation.com) – Money can’t buy everything. In the case of injured workers, more money doesn’t guarantee better outcomes or improved return-to-work rates, according to researchers.

study by the Workers Compensation Research Institute compared prices paid to medical providers through the workers’ compensation system and group health for the same services. Specifically, they wanted to address the question, what happens to outcomes of injured workers when prices increase or decrease?

The answer in a nutshell:, the amount of care increased and in some cases the wait time to see a physician decreased when providers were given more money; but in terms of the health and functioning of the injured worker and the speed and sustainability of RTW, there really was no difference.

The Research

The study provides insight into industry concerns about the effects of prices and fee schedules on injured workers; specifically, the impact of lower or higher prices on access to care, wait times to see non-emergency providers, and outcomes/recovery times.

Surveys of injured workers along with analyses of claims data formed the basis of the research. More than 6,600 workers injured between 2010 and 2013 in 14 states were surveyed. The claims data for more than 1,500,000 workers in 30 states who had more than 7 days away from work were also included.

The researchers looked at the prices paid to providers for workers’ compensation and group health in 30 states.

An interesting finding was the tremendous variation of prices paid to providers through the workers’ compensation system. And the differences were not limited to one state versus another.

“In some parts of Indiana, for example, some [providers were paid] 7 percent more than group health, while in other parts they paid 51 percent more than group health for the same services,” said Bogdan Savych, during a webinar on the findings. “So prices vary quite a bit within states.”

Savych noted the wide interstate price swings were seen in states with fee schedules, as well as those without.


The researchers looked at office visits and broke down their findings into two scenarios. In one, the prices paid to providers through workers’ compensation were below those in group health, and then were increased to be comparable. In the second scenario, the prices paid through workers’ compensation were initially about 10 percent more than in group health, and were increased to be about 40 percent higher.

While there were some slight differences seen in both scenarios, outcomes were not among them. There were, however, small increases in disability durations when providers were paid more. “There is no difference in access to care, but they get more care. This may result in the longer durations,” Savych said.

While overall outcomes did not improve when prices paid to providers were increased, there were some differences noted. For example, in the second scenario — when prices were above those for group health and then were increased by an additional 30 percent — injured workers reported fewer concerns about getting their desired providers and were able to see non-emergency providers within a shorter time span. The additional care provided in both scenarios comprised ‘conservative’ treatment, which may ultimately have prevented more expensive surgical procedures.

“Prices matter for some outcomes but not for others,” Savych said. “What happens with price changes depends on whether the prices are higher or lower than group health.”

One question is, what factors are important in shaping the differences in outcomes observed across states?

“This analysis shows it’s not the prices; it’s something else. What else? We have to do analysis and find out,” Savych said. “But it’s important to policymakers to realize price is important for some things but not many. Where we expected to find [differences], we didn’t.”

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