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Medical payments in California will increase by 5.5% in 2021



After falling in calendar year 2020, aggregate medical payments rebounded in 2021, rising about 5.5% to $1.9 billion, according to a report by the Workers’ Compensation Insurance Rating Bureau of California.

The WCIRB attributed the increase in aggregate payments to increases in average payments per transaction last year. And the increase in payments per transaction “was largely due to 2021 fee schedule updates for medico-legal services and evaluation and management services.”

While the estimated 559,000 claims in 2021 were unchanged from 2020 and both years included approximately 13 million paid medical transactions, the WCIRB reported that the average payment per claim increased 5.7% to $3,374 and the average payment per transaction increased 5 .6% to $1

46.

“Evaluation and management services experienced the largest percentage increase (5%) in the share of medical payments in 2021 compared to 2020, driven mostly by increases (13%) in paid per transaction,” according to the WCIRB report. “The higher paid per evaluation and management transaction was mostly due to the 2021 updates to the compensation allowance for evaluation and management services.”

In March 2021, the Division of Workers’ Compensation updated the billing evaluation and management section of the fee schedule to reflect changes made by Medicare.

In April 2021, the DWC adopted a new medico-legal fee schedule that created a flat fee of $2,025. The payment covers review of up to 200 pages of documents, with an additional payment of $3 per page thereafter. As a result, the share of medical payments for medico-legal services increased by 18% in 2021 and average payments per service increased by 21%.

The WCIRB reports that physician offices remain the leading service location, accounting for the highest share of medical payments at 58% and the highest share of medical transactions in 2021 at 82%. The WCIRB said this was partly the result of higher use of telemedicine services compared to previous years.

WorkCompCentral is a sister magazine to Business Insurance. More stories here.


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