Study Uncovers Nuanced Impact of Workers’ Compensation Prices on Injured Worker Outcomes

It makes sense to assume that workers’ compensation prices would impact injured worker outcomes, but a new study from the Workers Compensation Research Institute shows it’s not so straight-forward.
By: | June 12, 2019

A new study performed by the Workers’ Compensation Research Institute has uncovered some interesting — if slightly anticlimactic — findings related to workers’ compensation prices and injured worker outcomes, which will undoubtedly serve as useful information for policymakers determining workers’ compensation pricing.

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The study, the first of its kind to use surveys from injured workers to analyze the relationship between workers’ compensation prices for medical services and outcomes experienced by workers after a work-related injury, utilized survey responses from 6,600 workers who were injured between 2010 and 2013.

They also used claim records for more than 1.5 million injured workers to inform their findings.

The question they were trying to answer with this study is this: Do workers’ compensation prices impact outcomes for injured workers in meaningful ways?

The answer: Well, it’s nuanced.

Their research found that yes, certain outcomes for injured workers are impacted by workers’ compensation prices, but whether that actually translates to anything truly meaningful when it comes to injured worker outcomes is less clear.

What the Researchers Focused On

The study examined the effects of workers’ compensation prices, in comparison to group health care prices, on injured worker outcomes across a slew of states.

This meant that workers’ compensation prices varied, so to have one point of reference across all locations included in the study, the researchers chose to focus on the pricing of common office visits, which the majority of injured workers attend appointments for after an injury, rather than specialty medical treatment prices that wouldn’t apply to all injured workers.

When examining the link between workers’ compensation prices and outcomes, the study focused on five specific outcomes:

  1. Access to care
  2. Nature of medical care
  3. Change in physical health and functioning
  4. Return to work
  5. Temporary disability duration

The reasons for shining light on workers’ compensation prices in relation to injured worker outcomes are plentiful: First off, as the study authors point out, research has shown that doctors are motivated by price, so it makes sense to assume that doctors would be more likely to accept workers’ comp patients when workers’ compensation prices are similar to or higher than group health prices.

 

This willingness for doctors to take on workers’ comp patients could impact patients’ access to care, ultimately impacting their outcomes.

Doctors also serve as the gatekeepers for patients to specialists. So, a primary care physician who is not motivated to see workers’ comp patients based on price may impair those patients’ access to specialist care. 

The Findings

After examining the data, the study found that there was a strong link between workers’ compensation prices and the first outcome they were examining — access to care.

As the study notes, “On average, higher relative workers’ compensation prices are related to fewer reported concerns by injured workers about getting the desired medical provider, and related to slightly faster time to first non-emergency office visit. These findings are driven primarily by cases where workers’ compensation prices are generally higher than prices paid by group health, while we find a weaker relationship between prices and outcomes for cases where workers’ compensation prices are lower than or similar to group health prices.”

When it comes to the second outcome, the study found that, similarly, there was a strong link between workers’ comp prices and the nature of care. For example, when workers’ compensation prices were relatively higher, patients were significantly more likely to receive physical therapy within in the first six weeks of being injured and went to more office visits for evaluation and management services.

Interestingly, though, these first two outcomes don’t seem to have much effect on the final three outcomes, which is where the study loses some steam in uncovering relationships between pricing and outcomes.

The researchers didn’t find a strong link between workers’ compensation prices and changes in physical health and functioning of the patient (which was self-reported) or return-to-work outcomes. While they did find that workers’ compensation prices impacted the final outcome examined — duration of temporary disability — that impact wasn’t exactly meaningful.

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“Another way to think about these findings for duration of temporary disability,” the researchers write, “is that when workers’ compensation prices are significantly below group health care prices, injured workers receive somewhat less medical care (as captured by the number of office visits for evaluation and management services), and they go back to work slightly faster.

“When workers’ compensation prices are above group health levels, we find that increase in prices tend to speed up access to care, but workers also receive more care. These two effects offset each other and we do not find a material difference in duration of temporary disability.”

In the end, while the study authors do find some correlation between workers’ compensation prices, relative to group health care prices, on injured worker outcomes, they conclude that policymakers might be better off looking outside of price comparisons to see how they can improve injured workers’ outcomes.

As they write, “Little relationship between prices and many of the outcomes suggests that factors other than prices are important in shaping differences in outcomes observed across states. While worker outcomes differ across states, our research suggests that these differences are not due to the differences in prices for workers’ compensation services. Future studies may need to focus on other system features that may explain large differences in outcomes across states.”

So, turns out price comparison isn’t a silver-bullet solution, but the findings can still inform the policymakers’ decision-making process. &

Adjua Fisher is a freelance writer, editor and business owner living in Philadelphia. She is a former health and fitness editor at Philadelphia magazine. Adjua can be reached at [email protected]

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The R&I Editorial Team can be reached at [email protected]