The good folks at NCCI just released a study that, among other things, compares medical cost drivers from the nineties to those earlier in the ‘oughts. [opens pdf]
The study, authored by Tonya Restrepo and Harry Shuford, indicates that the increase in utilization of medical services dropped from the nineties to the oughts, and discusses the impact of that ‘decrease in the rate of increase’. I’ll be reviewing the study in detail later today, and will flesh out the post later.
The study actually focuses on the impact of medical on indemnity severity, a comparison well worth consideration and one many managed care providers, business units, and vendors have long struggled with.
For now, here are the highlights.
The increase in severity was partially due to changes in the mix of diagnoses, which shifted somewhat over the periods studied. In fact, the diagnosis-influenced change in severity was significant, but far outweighed by the change in underlying medical and indemnity inflation.
My interpretation – albeit one based on a quick read of the report, is this.
Underlying factors – those not work-comp-specific – are very much the driving force in work comp claim cost inflation.
Mar
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