Michigan medical comp costs among lowest in nation: Report

Michigan had among the lowest medical payments per lost-time workers compensation claim, according to research released Thursday by the Workers Compensation Research Institute.

The Cambridge, Massachusetts-based institute, which annually studies comp cost trends in 18 states, said Michigan’s medical costs were “fairly stable,” increasing an average of 2.5% between 2013 and 2018 for nonhospital services and 1.5% for hospital outpatient services.

Other findings included that nonhospital payments per claim were 25% lower than the median study state for 2018-2019 claims, reflecting lower prices paid for professional services and typical utilization of nonhospital services and that a larger proportion of workers received at least one service in a hospital setting than in most study states.

Overall stable trends in nonhospital payments per claim in Michigan “mask some variation” among key nonhospital services, according to the report. It said payments per claim increased for physical medicine services and “other services,” a category that mainly includes anesthesia, drugs, legal and special reports, supplies and equipment, and miscellaneous services billed by stand-alone ambulatory surgery centers, and other miscellaneously defined medical and/or diagnostic services and testing.

Payments per claim decreased for both major and minor radiology and neurological testing, and were stable for other key nonhospital services.

The WCRI cited fee schedules in Michigan as one of the reasons for stable costs in its comp system.