A new California Workers’ Compensation Institute (CWCI) study finds that the number of inpatient hospital stays in California workers’ compensation declined by 15.6 percent between 2008 and 2013, slightly less than the decline noted for hospital stays paid under private coverage, but significantly more than the declines noted in Medicare and Medi-Cal.

To quantify and compare the use of inpatient services and procedures in the different systems, the Institute used data compiled by the California Office of Statewide Health Planning and Development on more than 21.5 million inpatient hospitalization discharges that occurred in California between January 2008 and December 2013.  Of those 21.5 million discharges, 132,952 (0.6 percent) involved injured workers. In addition to tracking the overall trends in inpatient hospitalizations from 2008 through 2013, the study took a focused look at the use of implant-eligible spinal surgeries and noted a 10 percent reduction in the number of these surgeries in California workers’ compensation over the six-year span of the study. That decline coincided with the continued development of evidence-based medicine and utilization review, changes in the fee schedule, as well as the recent phase out of controversial “pass-through” payments for hardware used in workers’ comp spinal surgeries called for by SB 863. Moreover, in 2013, the year that pass-through payments were eliminated but additional fees were allowed for seven spinal surgery categories to cover costs that included implants, the number of implant-eligible spinal surgeries in workers’ comp dropped 8.4 percent, well above the 5.6 percent decline noted for all inpatient stays. This suggests that the SB 863 provisions that phased out the spinal implant pass-through payments may have had an immediate effect on the volume of these surgeries.

Results of the study have been published in a CWCI Research Update report, “Inpatient Utilization in the California Workers’ Compensation System.”  Exhibits within the report provide detailed data on:

• The volume and distribution of inpatient services and procedures in California workers’ comp compared to private coverage, Medicare and Medi-Cal;
• The most common inpatient discharges by diagnostic-related group in California workers’ comp;
• Changes in the number of implant-eligible spinal surgeries in workers’ comp compared to the three other systems; and
• The estimated savings associated with the elimination of spinal hardware pass-through payments in workers’ compensation, which the Institute pegs at $58 million to $92 million in 2013 and $53 million to $84 million in 2014.

The Research Update report is available to CWCI members and Research subscribers who use their passwords to log in to the Institute’s website atwww.cwci.org.