A new study that tracks changes in the types, volume and reimbursement of treatment rendered to injured workers in California shows that since the implementation of medical reforms in 2004, by far the most significant savings have come from reductions in the use of chiropractic manipulation and physical therapy, with much smaller reductions noted in the utilization and reimbursements for other medical services — except surgery, where utilization has shown little change and average payments per claim have increased.

Between 2002 and 2004 California lawmakers enacted several reforms to control workers’ compensation medical costs, which had more than doubled in five years, and to assure that the types and levels of treatment provided to injured workers were appropriate and effective for their specific type of injury. Key reforms included: elimination of the physician’s rebuttable presumption of correctness in regard to all medical issues; mandatory utilization review and the adoption of a medical treatment utilization schedule based on nationally recognized, evidence-based, peer-reviewed treatment guidelines; 24-visit caps on chiropractic and physical therapy; revisions to the Official Medical Fee Schedule; and the introduction of workers’ compensation Medical Provider Networks, which began operations in 2005.

The new study is based on a review of nearly 1 million California workers’ compensation claims for 2002 through June 2006 injuries, which encompassed $1.8 billion in reimbursements for medical treatment delivered from January 2002 through October 2006. The study measures pre- and post-reform medical utilization and reimbursement at five points within the life the claim: 6, 9, 12, 18, and 24 months post injury. Results are broken out across six treatment categories: physical therapy; chiropractic manipulation; evaluation and management; medicine section services; surgery, excluding injections; and radiology.

CWCI has released the study as a Research, “Analysis of California Workers’ Comp Reforms: Medical Utilization & Reimbursement Outcomes AY 2002-2006 Claims Experience,” which is posted online on the CWCI website, www.cwci.org.  This report is the first in a 4-part series updating earlier analyses that measured the impact of the 2002-2004 workers’ compensation reforms on various aspects of the California workers’ compensation system. Subsequent reports will also use AY 2002-2006 claims data to look at changes in temporary disability, the use of network providers since the advent of Medical Provider Networks, and the impact of reforms’ medical cost containment strategies.