Analysis of the Workers Compensation Medical Fee Schedules in Illinois. Stacey M. Eccleston

Transcription

1 Analysis of the Workers Compensation Medical Fee Schedules in Illinois Stacey M. Eccleston

2 ANALYSIS OF THE WORKERS COMPENSATION MEDICAL FEE SCHEDULES IN ILLINOIS

3 ANALYSIS OF THE WORKERS COMPENSATION MEDICAL FEE SCHEDULES IN ILLINOIS STACEY M. ECCLESTON July 2006 WC WORKERS COMPENSATION RESEARCH INSTITUTE CAMBRIDGE, MASSACHUSETTS

4 COPYRIGHT 2006 BY THE WORKERS COMPENSATION RESEARCH INSTITUTE ALL RIGHTS RESERVED. NO PART OF THIS BOOK MAY BE COPIED OR REPRODUCED IN ANY FORM OR BY ANY MEANS WITHOUT WRITTEN PERMISSION OF THE WORKERS COMPENSATION RESEARCH INSTITUTE. LIBRARY OF CONGRESS CATALOGING-IN-PUBLICATION DATA [TO COME] PUBLICATIONS OF THE WORKERS COMPENSATION RESEARCH INSTITUTE DO NOT NECESSARILY REFLECT THE OPINIONS OR POLICIES OF THE INSTITUTE S RESEARCH SPONSORS.

5 ACKNOWLEDGMENTS This study would not have been possible without the assistance and expertise of several individuals. Technical reviewer Dr. Peter Barth made valuable and insightful comments and suggestions that led to substantial improvement in the book s presentation and focal points. Colleagues Xiaoping Zhao, Dawn Albright, and Michael Watson lent their expertise in the programming and analysis of the data. We thank WCRI s Disability Management/Benefit Integration (DMBI) Core Funder group for their continued support that makes this and similar studies possible. Linda Carrubba, Stephanie Deeley, and Jammie Middleton provided invaluable administrative assistance in the draft and final stages of the study, and Karen Holt ushered it through the publication process. Finally, the insight and guidance of the Institute s executive director, Dr. Richard Victor, was invaluable to the publication s success. Of course, any errors or omissions that remain are the responsibility of the author. Stacey M. Eccleston Cambridge, Massachusetts July 2006 iv

6 TABLE OF CONTENTS List of Tables... vi List of Figures...viii Analysis of the Workers Compensation Medical Fee Schedules in Illinois... 1 Summary of Major Findings...2 Background... 5 HISTORIC PRICES IN ILLINOIS... 6 The Illinois Fee Schedule Is One of the Highest in the Nation... 8 The 2006 Fee Schedule Price Often Exceeds the Pre-Fee Schedule Average Price Paid in Illinois Possible Unintended Consequences Arising from 29 Different Fee Schedules in Illinois Indexing the Fee Schedule to the Consumer Price Index May Reduce the Rate of Growth Methods and Data SCOPE OF ANALYSIS THE MARKETBASKET APPROACH AND REPRESENTATIVENESS CREATING THE MARKETBASKET CREATING THE FEE SCHEDULE INDEX ANALYSIS OF PRICES PAID IN ILLINOIS References Web Site Address for Supplementary Material Analysis of the Workers Compensation Medical Fee Schedules in Illinois: Statistical Appendix v

7 LIST OF TABLES 1 Workers' Compensation Premiums over Medicare by Service Group, 2005/2006 / 9 2a 2b 3a 3b 4a 4b 5a 5b 6a 6b 7a 7b Commonly Billed Evaluation and Management Services: % By Which Fee Schedule Amount Exceeds Average Price Paid / 14 Commonly Billed Evaluation and Management Services: % That Were Paid at Prices above the Fee Schedule / 15 Commonly Billed Major Surgery Services: % By Which Fee Schedule Amount Exceeds Average Price Paid / 16 Commonly Billed Major Surgery Services: % That Were Paid at Prices above the Fee Schedule / 18 Commonly Billed Major Radiology Services: % By Which Fee Schedule Amount Exceeds Average Price Paid / 19 Commonly Billed Major Radiology Services: % That Were Paid at Prices above the Fee Schedule / 20 Commonly Billed Minor Radiology Services: % By Which Fee Schedule Amount Exceeds Average Price Paid / 21 Commonly Billed Minor Radiology Services: % That Were Paid at Prices above the Fee Schedule / 22 Commonly Billed Physical Medicine Services: % By Which Fee Schedule Exceeds Average Price Paid / 23 Commonly Billed Physical Medicine Services: % That Were Paid at Prices above the Fee Schedule / 25 Commonly Billed Neurological Testing Services: % By Which Fee Schedule Amount Exceeds Average Price Paid / 26 Commonly Billed Neurological Testing Services: % That Were Paid at Prices above the Fee Schedule / 27 vi

8 8 Fee Schedule Prices Top 5 Most Frequently Billed Codes in Each Service Group Eleven Different Illinois Zip Code Areas (Metropolitan Chicago, Champaign, East St. Louis) / 27 9 Fee Schedules Compared to Price Paid for Electromyography (CPT 95860) in Highest and Lowest Fee Schedule Areas / Fee Schedules Compared to Price Paid for Shoulder Arthroscopy (CPT 29826) in Highest and Lowest Fee Schedule Areas / Coverage of Illinois Medical Fee Schedule Analysis / Summary of Marketbasket and Representation / Distribution of Employment Population by the 29 Geozips in Illinois / 37 vii

9 LIST OF FIGURES 1 Illinois Average Prices Were Second Highest among Study States for Nonhospital Providers / 7 2 Average Prices Paid to Nonhospital Providers Grew Somewhat Faster Than the Median State / 7 3 Illinois* Fee Schedule Is Third Highest Nationally, on Average, 2005 / Illinois Area Fee Schedules Range from 115 to 219% above Medicare / 12 5 CPI Grew 3 4% More Slowly Each Year Than Average Prices Paid / 33 viii

10 ANALYSIS OF THE WORKERS COMPENSATION MEDICAL FEE SCHEDULES IN ILLINOIS Illinois House Bill 2137 was signed into law on July 20, As part of that bill, the first Illinois workers compensation medical fee schedule became effective on February 1, This study analyzes the professional medical fees established in that fee schedule for each of the 29 geographic areas mandated by statute. This study: Compares the Illinois workers compensation medical fee schedules for professional services to actual prices paid in each area of Illinois for 2006; the corresponding 2006 Medicare fee schedule for each area; other state workers compensation fee schedules. Describes the extent of variation in fee schedule levels among the 29 different fee schedules in Illinois. Identifies some incentives in the fee schedules that may lead to unintended consequences Examines the provision of the statute that provides for the fee schedule to be annually increased by the change in the U.S. Consumer Price Index (CPI). The analysis in this study is limited to the nonfacility, professional services billed under Current Procedural Terminology (CPT) codes 1. This study does not address hospital inpatient fees, or hospital outpatient or ambulatory surgery treatment center (ASTC) fees, for which the fee schedule amounts are generally 76 percent of charges. To combine diverse medical services into a single value for each area, the analysis uses a standard approach that is similar to the construction of the CPI. We use a marketbasket of medical services that are frequently billed in the Illinois workers compensation 1 Fees for anesthesia are excluded because of the use of time units, which make it difficult to make comparisons of prices paid. Pathology services are excluded because very few pathology services are included in the Medicare fee schedules. Together these services make up less than 6 percent of total nonhospital medical payments. 1

11 system. These important services make up 82 percent of nonfacility workers compensation medical expenditures for professional services. More detail on the methodology can be found in the section entitled Data and Methods. For simplicity, we sometimes use the term Illinois* fee schedule. By Illinois*, we mean a single number that represents the aggregate of the 29 regional fee schedules. To compute this, we take the fee schedule value for each of the 29 areas. Then we add them together giving the greatest weight to the largest areas. The weights used are the number of employed workers in each area, based on the location of the worker s residence. SUMMARY OF MAJOR FINDINGS The Illinois* fee schedule is one of the highest in the nation in The fee schedules in most states in December 2005 were percent above the Medicare rates in the state. The Illinois* fee schedule averaged 167 percent above the Illinois Medicare rates for Even the lowest of the 29 area fee schedules in Illinois (622-East St. Louis) was one of the highest in the nation 115 percent above the Medicare rates in the area. The highest of the 29 areas (618-Champaign) was 219 percent above that area s Medicare rates. The Illinois fee schedule preserves the historic incentives for invasive and specialty care that the Medicare program has significantly reduced. The fee schedule for Illinois* for surgery was 418 percent above the Illinois Medicare rates for surgery. The fee schedule for radiology was 175 percent above the Medicare rates. By contrast, the Illinois* fee schedule for evaluation and management services (largely office visits) was 52 percent above the Medicare rates. The relatively higher rates for surgery versus office visits reward specialty and invasive care far more than primary care. 2

12 The Illinois* fee schedule was higher than the average prices paid 2 in Illinois for many services, especially for surgery and radiology. For example, the fee schedule amounts for some of the common major surgeries were generally percent higher than the average prices paid for these surgeries in workers compensation. However, the fee schedule amounts were similar to or lower than prices that were commonly paid for other services. Even though most common major radiology and surgical services were paid below the new fee schedule levels, the fee schedule might produce some savings for some payors, since a small to moderate proportion of the bills were paid above the new fee schedule. For some other common services, nearly one-half of bills were paid above the new fee schedule. We would expect to see greater savings for these services. The savings potential for payors that are covered by networks and have relatively high network penetration might be much less than that for nonnetwork payors, assuming networks already pay at substantial discounts from charges. The Illinois workers compensation fee schedule is unique in its design setting different maximum reimbursement rates for the same services for each of 29 different areas of the state. Areas were defined according to the first three digits of the zip code where the service was delivered including nine different fee schedules in the greater Chicago metropolitan area. Only three other states (Florida, New York, and Pennsylvania) had different workers compensation medical fee schedules for different parts of the state, and of those, the maximum number of areas was four. The Illinois Medicare fee schedule sets different rates for only four different geographic regions within Illinois. The Medicare differentials are based on research studies that measure the costs to the providers of delivering services including differences from area to area in office practice expenses and medical malpractice insurance premiums. The difference between the lowest and highest of the Medicare areas is 17 percentage 2 Prices paid are derived from actual payments from WCRI s database containing line item billing and payment information from a representative group of payors in the state. The prices paid could differ from actual prices paid across the state if our data sources represent a higher proportion of network discounts than is found in the state. Fortyone percent of the payments in our database are made for network services (see Methods and Data section for more detail). 3

13 points. By contrast, the 29 fee schedules in Illinois ranged from a low of 115 percent above Medicare (622-East St. Louis) to a high of 219 percent above Medicare (618- Champaign) a difference of 104 percentage points. Unlike Medicare, the differences in the Illinois fee schedule reflect differences in provider charges, which did not appear to be consistently related to differences among areas in the actual costs incurred by providers. It should be noted that the five largest fee schedule areas in Illinois represent nearly two-thirds of the employment in the state. The use of 29 different area fee schedules sometimes leads to odd results, due, in part, to (1) the inconsistent relationship between provider charges and the actual costs incurred by providers to deliver the service, and (2) the relatively small numbers of procedures that were necessarily used to estimate average charges for many procedures, given the relatively small areas that result when a state is divided into 29 regions. These small numbers as small as 9 procedures inevitably introduce significant random variation to some of the estimates that underlie the fee schedule. These oddities may create unintended incentives for providers to increase revenues by moving the site of service or otherwise zip-gaming the system. While these instances are not pervasive, they occur with sufficient frequency that one might question the wisdom of having so many different reimbursement rates, especially within the Chicago metropolitan area. Prices paid are generally determined by local market conditions, including the supply of and demand for different providers services, the rates paid by group health payors, and negotiated workers compensation prices between payors and workers compensation networks. If areas with higher (lower) prices actually paid had higher (lower) fee schedule amounts, we would say that the fee schedule was rationally related to the local market conditions. For most common services in Illinois, we found that the areas with the highest fee schedules were not the areas where market conditions led to the highest prices having been paid. For some common services, we observed little rational relationship between the fee schedule and prices actually paid for some services, for others the relationship was weak and for still others the relationship was stronger. But across most common services analyzed, the higher fee schedule areas were frequently not the areas with proportionately higher prices 4

14 actually paid. With a fee schedule based on charges (like Illinois), this could occur if charges are not well-reflective of true market conditions. This situation is similar to the sticker price on an automobile, where the true price is closer to the sticker price for cars where demand exceeds supply, but not for slower sellers. The annual increases in the fee schedule amounts are tied to the change in the CPI. Workers compensation medical prices actually paid in Illinois have historically grown by 3 to 4 percentage points per year faster than the CPI. Where the fee schedule levels are binding on the actual prices paid, and unless offset by changes in billing and treatment practices by providers, we would expect this approach to dampen the increase in prices paid compared to what the increase in prices would have been without the fee schedule. However, this is true only for the services covered by the fee schedule and does not apply to services or providers not covered by Illinois fee schedules or for those services set at a moving 76 percent of charges. WCRI has found that charges have historically increased at an average annual rate of between 7 and 8 percent per year (see Figure 5). BACKGROUND The Illinois Workers Compensation Commission promulgated a fee schedule to establish maximum medical payments for both professional and facility fees provided to workers compensation patients. (cite. 820 ILCS 305/8.2: Public Act ) The fee schedule covers professional nonhospital services billed under CPT codes (analyzed in this report) as well as sets maximum fees for ambulatory surgical treatment centers (76 percent of the charged amounts) and hospital inpatient and outpatient services. The maximum fees for nonhospital services in the Illinois fee schedule were set by determining 90 percent of the 80 th percentile of health care provider charges (billed amounts) from August 1, 2002, through August 1, By statute, fee schedule amounts were established for 29 geozips (the three-digit zip code where the treatment was provided) in Illinois. The fee schedule developers note that some zip code areas may have been combined with up to four other areas to get a minimum of nine charged services for any given code. If there were less than nine billed services for a given code, the fee schedule maximum is set at 5

15 76 percent of the charged amount. Future WCRI studies will likely track the impact of the fee schedule on Illinois payments and billing behavior and will evaluate, among other things, whether providers increase charges for services covered under the 76 percent rule, and/or whether there is a shift into billing more of these codes and the extent to which there is a shift in the billing volume across the different geographic areas subject to differing fees. The fees from 2002 to 2004 were then increased by an amount equal to the increase in the CPI for the period August 1, 2004, through September 30, 2005 (4.96 percent). 3 The maximum fees in the fee schedule will automatically increase or decrease each year based upon the annual change in the general CPI. HISTORIC PRICES IN ILLINOIS The effort to create an Illinois fee schedule may be the result of the fact that medical prices in Illinois were higher and growing faster than many other large states, and that Illinois was one of only seven states nationally that did not have a workers compensation medical fee schedule (Eccleston and Zhao, 2005). In addition, other WCRI studies have shown that the medical cost per claim in Illinois was among a higher group of study states (Telles, Wang, and Tanabe, 2006). The higher medical costs per claim were cited to be due in part to higher prices paid for medical services compared to the other study states. Figure 1 shows a price index for nonfacility services delivered in calendar year 2003 for Illinois. The price index measures the average prices paid compared to 12 other study states. It shows that Illinois had the second highest average prices among the 13 study states. Figure 2 shows that average prices paid in Illinois grew at a faster rate compared to other study states. 3 See Introduction and Purpose section. 6

16 Figure 1 Illinois Average Prices Were Second Highest among Study States for Nonhospital Providers Price Index (Median=100) MD FL MA CA PA NC TX AR LA TN* IN* IL* WI* Price Index for Nonhospital Services Rendered in Calendar Year 2003 *No fee schedule at the time Source: Eccleston, Petrova, and Zhao, forthcoming. Figure 2 Average Prices Paid to Nonhospital Providers Grew Somewhat Faster Than the Median State Average Annual % Change 2001 to % 7% 6% 5% 4% 3% 2% 1% 0% -1% -2% TX CA LA NC AR MD IN PA TN FL MA IL WI Source: Eccleston, Petrova, and Zhao, forthcoming. 7

17 THE ILLINOIS FEE SCHEDULE IS ONE OF THE HIGHEST IN THE NATION We compared the Illinois workers compensation fee schedules to 41 other state fee schedules, effective December 31, To standardize for differences in medical office practice and malpractice expenses, we compared each fee schedule to the Medicare rates in that state. 5 As Figure 3 shows, the Illinois* fee schedule was 167 percent above the 2006 Illinois Medicare rates (applied to common workers compensation medical procedures) third highest in the nation. By contrast, 29 of the 42 states had workers compensation fee schedule levels that averaged between 25 and 85 percent higher than their state Medicare fee level. Figure 3 Illinois* Fee Schedule Is Third Highest Nationally, on Average, 2005 % Greater Than State Medicare Rates States with Fee Schedules Illinois* Illinois* = weighted average of 29 Illinois regions The Illinois* fee schedule was higher than most other states for all service groups (see Table 1). It was the third highest for major surgery (418 percent above Illinois 4 For the interstate comparisons, we use a single marketbasket of services that is identical for all states a composite of multiple states. For the other analyses in subsequent sections, we used a marketbasket of services that is specific to Illinois. The differences are small, but it is methodologically correct to use different marketbaskets for the different comparisons. 5 The Medicare rates include adjustment factors for interregional differences in medical office practice expenses and malpractice expenses. 8

18 Medicare) and surgical treatment (185 percent above), second highest for physical medicine (101 percent above), fourth highest for radiology (175 percent above) and seventh highest for evaluation and management services (52 percent above). Table SA.1 in the Statistical Appendix ( IL_Fee_Schedule_SA.pdf) shows the percentage over Medicare for each of Illinois 29 different fee schedules for each service group. The Illinois fee schedule preserves the historic incentives for invasive and specialty care that the Medicare program has significantly reduced by realigning prices with the resource costs to providers of delivering services and reducing prices for certain surgical and diagnostic procedures. 6 The fee schedule for Illinois* for major surgery was 418 percent above Medicare rates. The fee schedule for radiology was 175 percent above the Medicare rates. By contrast, the Illinois* fee schedule for evaluation and management services (largely office visits) was 52 percent above the Medicare rates. Medicare sought to reduce the disparities between the prices of these different types of services to neutralize the incentives to provide invasive and specialty care because they might be more profitable than primary care and physical medicine services. Such incentives to provide care without evidence of betterment of health status is not in interests of patients. Table 1 Workers' Compensation Premiums over Medicare by Service Group, 2005/2006 State Percentage Greater Than or Less Than Medicare Overall Major Surgery Surgical Treatment Radiology General Medicine Physical Medicine Evaluation and Management Alaska Idaho Illinois a Oregon Rhode Island b N/C 13 6 Physician Payment Review Commission, Annual Report

19 Table 1 Workers' Compensation Premiums over Medicare by Service Group, 2005/2006 (continued) State Percentage Greater Than or Less Than Medicare Overall Major Surgery Surgical Treatment Radiology General Medicine Physical Medicine Evaluation and Management Nebraska Connecticut Nevada Tennessee Mississippi New Mexico Louisiana Alabama Arizona Maine Montana Oklahoma South Dakota Minnesota Arkansas Wyoming Kansas Georgia South Carolina North Dakota Ohio Vermont New York a Colorado Washington North Carolina Kentucky Pennsylvania a Utah Michigan Texas California Florida a

20 Table 1 Workers' Compensation Premiums over Medicare by Service Group, 2005/2006 (continued) State Percentage Greater Than or Less Than Medicare Overall Major Surgery Surgical Treatment Radiology General Medicine Physical Medicine Evaluation and Management West Virginia Hawaii Maryland Massachusetts Notes: Fees schedules are those in effect in December 2005 except Alaska Medicare fee schedule and Illinois workers' compensation and Medicare fee schedules, where we used 2006 fee schedules. In Alaska, there was a temporary significant increase in the Medicare fee schedule due to a dramatic increase in geographic practice cost indices in 2004 and 2005, which was mandated by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, but was removed in Because the increase in 2005 was temporary, we decided to use the 2006 Medicare fee schedule to make comparisons. In Illinois, to have a compatible comparison between the 2006 workers' compensation fee schedule and Medicare, we used the 2006 Medicare fee schedule for Illinois. About one quarter of the other states had updates to their fee schedules in the first quarter of 2006, but in most cases, the changes are minimal and are often tied to any change in the Medicare fees. a For Florida, Illinois, New York and Pennsylvania, we created a single statewide index using employment population weights of the regions as defined in the states' workers' compensation fee schedules. Fourteen states establish Medicare fee schedules for multiple geographic regions in their states. We also created a single statewide index using employment population weights of the regions as defined in the states' Medicare fee schedules. b Rhode Island bills physical medicine procedures differently than other states do; thus we were unable to compare Rhode Island to other states in that service group. The overall index, therefore, is based on the fee levels of the following service groups in 2005: surgery, radiology, general medicine, and evaluation and management. Key: N/C: noncomparable. Figure 4 shows the 29 different area fee schedules in Illinois. When contrasted with Figure 3, one can see that even the lowest of the 29 area fee schedules in Illinois (622-East St. Louis) was one of the highest in the nation 115 percent above the Medicare rates in the area. The highest of the 29 areas (618-Champaign) was 219 percent above the area s Medicare rates. 11

21 Figure 4 29 Illinois Area Fee Schedules Range from 115 to 219% above Medicare 225% % Greater Than Area Medicare Rates 200% 175% 150% 125% 100% 75% 50% 25% 0% THE 2006 FEE SCHEDULE AMOUNT OFTEN EXCEEDS THE PRE-FEE SCHEDULE AVERAGE PRICE PAID IN ILLINOIS With the exception of fees for X rays, the Illinois fee schedules were typically higher than the pre-fee schedule average prices paid in the corresponding areas in Illinois for many services, especially for surgery and radiology. We analyze the relationship between the prices actually paid and the fee schedule amounts by focusing on the most commonly used medical procedures for each major service group; making comparisons for each of the 29 individual areas. However, we do not report data where we observe fewer than 30 instances of an individual procedure (billing code) in a specific geographic area. Our inspection of the data, and our own conservative practices, suggested that using fewer than 30 observations risks introducing material random error. As a result, for some procedures discussed here, we do not report values for all 29 areas. Detail on the average price paid for each of the 12

22 areas with 30 or more observations can be found in the Statistical Appendix tables SA.600 through SA.629 ( IL_Fee_Schedule_SA.pdf). For common evaluation and management procedures (e.g., office visits), the fee schedule amount was within 10 percent of the average payment for that service in many of the 29 areas (see Table 2a). However, it was not unusual in some areas for the fee schedule to be percent higher than the average pre-fee schedule amount paid. In a few isolated instances, the fee schedule amount was up to 25 to 50 percent higher than the average price paid for that service in that area. Where the fee schedule was near the average prices paid for the service, typically about 40 to 70 percent of the services billed were paid at levels above the fee schedule. The new fee schedule will likely have an impact on lowering those payments. For other services and other zip code areas where the evaluation and management fee schedule was substantially higher than the average price paid, less than 40 percent of services billed were paid at an average price higher than the fee schedule (see Oak Park (zip 603), Evanston (zip 602) or Champaign (zip 618), for example) (Table 2b). For common surgical procedures, there was little relationship between the price paid in the area and the fee schedule amount. In some areas, the fee schedule amount was 50 percent or more above the average price paid; while in other areas the fee schedule amount was similar to the average price paid for that procedure in that area prior to the fee schedule (Table 3a). For example, in East St. Louis (zip 622), the fee schedule was 39 percent higher than the average price paid for a knee arthroscopic procedure, but for shoulder arthroscopy or neuroplasty, the fee schedule was closer to the average price paid. In many areas, the majority of services were paid at average prices that were below the fee schedule. In many of the metropolitan Chicago areas, for example, only 10 to 30 percent of services were paid at a rate higher than the fee schedule. In some other areas for certain services, there may be more potential for lowering prices paid where the payments for more than one half 13

23 Table 2a Commonly Billed Evaluation and Management Services: % By Which Fee Schedule Amount Exceeds Average Price Paid a CPT Code Definition (abbreviated) Des Plaines 600xx Elgin 601xx Evanston 602xx Oak Park 603xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx Niles 607xx Cicero 608xx Kankakee 609xx Evaluation and management Office visit, established patient (expanded) Office visit, established patient (detailed) Office visit, new patient (detailed problem focused) Office visit, new patient (comprehensive) Galena 610xx Rockford 611xx Rock Island 612xx Streator 613xx Galesburg 614xx Pekin 615xx Peoria 616xx Bloomington 617xx Champaign 618xx Mattoon 619xx Office visit, established patient (expanded) Office visit, established patient (detailed) Office visit, new patient (detailed problem focused) Office visit, new patient (comprehensive) N/A Alton 620xx East St. Louis 622xx Quincy 623xx Effingham 624xx Decatur 625xx Lincoln 626xx Springfield 627xx Centralia 628xx Office visit, established patient (expanded) Office visit, established patient (detailed) Carbondale 629xx Office visit, new patient (detailed problem focused) Office visit, new patient (comprehensive) 11-4 N/A Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service listed above. a A positive number indicates that the fee schedule amount exceeds average price paid; a negative number indicates the reverse. 14

24 Table 2b Commonly Billed Evaluation and Management Services: % That Were Paid at Prices above the Fee Schedule CPT Code Definition (abbreviated) Des Plaines 600xx Elgin 601xx Evanston 602xx Oak Park 603xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx Niles 607xx Cicero 608xx Kankakee 609xx Evaluation and management Office visit, established patient (expanded) Office visit, established patient (detailed) Office visit, new patient (detailed problem focused) Office visit, new patient (comprehensive) Galena 610xx Rockford 611xx Rock Island 612xx Streator 613xx Galesburg 614xx Pekin 615xx Peoria 616xx Bloomington 617xx Champaign 618xx Mattoon 619xx Office visit, established patient (expanded) Office visit, established patient (detailed) Office visit, new patient (detailed problem focused) Office visit, new patient (comprehensive) N/A Alton 620xx East St. Louis 622xx Quincy 623xx Effingham 624xx Decatur 625xx Lincoln 626xx Springfield 627xx Centralia 628xx Carbondale 629xx Office visit, established patient (expanded) Office visit, established patient (detailed) Office visit, new patient (detailed problem focused) Office visit, new patient (comprehensive) Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service ( 15

25 Table 3a Commonly Billed Major Surgery Services: % By Which Fee Schedule Amount Exceeds Average Price Paid a CPT Code Definition (abbreviated) Des Plaines 600xx Elgin 601xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx Galena 610xx Rockford 611xx Rock Island 612xx Major surgery Arthroscopy with partial acromioplasty (shoulder) N/A 21 N/A Arthroscopy with meniscectomy (knee) N/A N/A N/A Neuroplasty and/or transposition; carpal tunnel Streator 613xx Peoria 616xx Bloomington 617xx Champaign 618xx Mattoon 619xx Alton 620xx East St. Louis 622xx Quincy 623xx Arthroscopy with partial acromioplasty (shoulder) N/A -2 N/A N/A N/A N/A Arthroscopy with meniscectomy (knee) N/A 9 N/A N/A N/A N/A Neuroplasty and/or transposition; carpal tunnel Effingham 624xx Decatur 625xx Lincoln 626xx Springfield 627xx Centralia 628xx Carbondale 629xx Arthroscopy with partial acromioplasty (shoulder) N/A N/A N/A N/A 0 N/A Arthroscopy with meniscectomy (knee) N/A N/A N/A N/A N/A N/A Neuroplasty and/or transposition; carpal tunnel Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service listed above ( a A positive number indicates that the fee schedule amount exceeds average price paid; a negative number indicates the reverse. 16

26 of services billed were paid at rates higher than the fee schedule (see, for example, Peoria (zip 616)) (Table 3b). For some common major radiology procedures (e.g., MRIs), the fee schedule amount was 40 to as much as 80 percent higher than average prices paid in many of the areas (even higher in Springfield (zip 627)). Still, in a few areas, the fee schedule was closer to the average prices paid, such as Alton (zip 620), for example. Because MRIs do not occur as frequently as many other services, there were fewer areas in our data with 30 or more occurrences, which limits the number of areas included in the analysis (Table 4a). In areas where the fee schedule was 40 to 80 percent higher than the average prices paid, only about 15 to 25 percent of the services were paid at a price higher than the fee schedule amount (see Elgin (zip 601), Bolingbrook (zip 604), Downers Grove (zip 605), and the City of Chicago (zip 606) for example). In other areas where the average price was closer to the fee schedule amount, there is greater potential for reduced prices for these services. See, for example, Alton (zip 620) and Carbondale (zip 629) (Table 4b). For the common minor radiology (e.g., X rays and ultrasound) procedures analyzed, the fee schedule amount was often within 20 percent of the average prices paid in most areas (Table 5a). Table 5b shows that in many cases, the majority of the minor radiology services billed (generally more than one-half) were paid at rates higher than the fee schedule, indicating a greater potential for lowering the prices paid for these services for some payors. For the common physical medicine procedures analyzed, the fee schedule amount was often within 20 percent of the average pre-fee schedule prices paid in most areas (Table 6a). However, in some areas, the fee schedule amount for some procedures was more than 20 percent higher than the average prices paid for that service in the area. For other areas or common procedures, the fee schedule amounts were more than 20 percent lower than the average prices paid. 17

27 Table 3b Commonly Billed Major Surgery Services: % That Were Paid at Prices above the Fee Schedule CPT Code Definition (abbreviated) Des Plaines 600xx Elgin 601xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx Galena 610xx Rockford 611xx Rock Island 612xx Major surgery Arthroscopy with partial acromioplasty (shoulder) N/A Arthroscopy with meniscectomy (knee) N/A N/A N/A Neuroplasty and/or transposition; carpal tunnel Streator 613xx Peoria 616xx Bloomington 617xx Champaign 618xx Mattoon 619xx Alton 620xx East St. Louis 622xx Quincy 623xx Arthroscopy with partial acromioplasty (shoulder) N/A 63 N/A N/A N/A N/A Arthroscopy with meniscectomy (knee) N/A 68 N/A N/A N/A N/A Neuroplasty and/or transposition; carpal tunnel Effingham 624xx Decatur 625xx Lincoln 626xx Springfield 627xx Centralia 628xx Carbondale 629xx Arthroscopy with partial acromioplasty (shoulder) N/A N/A N/A N/A 46 N/A Arthroscopy with meniscectomy (knee) N/A N/A N/A N/A N/A N/A Neuroplasty and/or transposition; carpal tunnel Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service ( 18

28 Table 4a Commonly Billed Major Radiology Services: % By Which Fee Schedule Amount Exceeds Average Price Paid a CPT Code Definition (abbreviated) Major radiology Des Plaines 600xx Elgin 601xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx Rockford 611xx Champaign 618xx Alton 620xx East St. Louis 622xx Springfield 627xx Centralia MRI, upper extremity without contrast MRI, lumbar without contrast N/A N/A MRI, lower extremity without contrast N/A N/A N/A MRI, cervical without contrast N/A N/A N/A N/A 105 N/A N/A Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service listed above ( a A positive number indicates that the fee schedule amount exceeds average price paid; a negative number indicates the reverse. 628xx Carbondale 629xx 19

29 Table 4b Commonly Billed Major Radiology Services: % That Were Paid at Prices above the Fee Schedule CPT Code Definition (abbreviated) Des Plaines 600xx Elgin 601xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx Rockford 611xx Champaign 618xx Alton 620xx East St. Louis 622xx Springfield 627xx Centralia 628xx Carbondale 629xx Major radiology MRI, upper extremity without contrast MRI, lumbar without contrast N/A N/A MRI, lower extremity without contrast N/A N/A N/A 62 MRI, cervical without contrast N/A N/A N/A N/A 11 N/A N/A Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service ( 20

30 Table 5a Commonly Billed Minor Radiology Services: % By Which Fee Schedule Amount Exceeds Average Price Paid a CPT Code Minor radiology Definition (abbreviated) Des Plaines 600xx Elgin 601xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx X ray, complete, two views N/A Radiologic examination, spine, minimum of four views N/A N/A Radiologic examination, finger(s), minimum of two views Rockford 611xx Rock Island 612xx Peoria 616xx Bloomington 617xx Champaign 618xx Niles 607xx Mattoon 619xx X ray, complete, two views N/A Radiologic examination, spine, minimum of four views N/A N/A N/A N/A 10 N/A N/A Radiologic examination, finger(s), minimum of two views N/A East St. Louis 622xx Quincy 623xx Effingham 624xx Decatur 625xx Springfield 627xx Centralia 628xx X ray, complete, two views -23 N/A Galena 610xx Alton 620xx Carbondale 629xx Radiologic examination, spine, minimum of four views N/A N/A N/A N/A N/A -13 N/A Radiologic examination, finger(s), minimum of two views N/A Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service listed above ( a A positive number indicates that the fee schedule amount exceeds average price paid; a negative number indicates the reverse. 21

31 Table 5b Commonly Billed Minor Radiology Services: % That Were Paid at Prices above the Fee Schedule CPT Code Minor radiology Definition (abbreviated) Des Plaines 600xx Elgin 601xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx X ray, complete, two views N/A Radiologic examination, spine, minimum of four views N/A N/A Radiologic examination, finger(s), minimum of two views Rockford 611xx Rock Island 612xx Peoria 616xx Bloomington 617xx Champaign 618xx Niles 607xx Mattoon 619xx X ray, complete, two views N/A Radiologic examination, spine, minimum of four views N/A N/A N/A N/A 35 N/A N/A Radiologic examination, finger(s), minimum of two views N/A East St. Louis 622xx Quincy 623xx Effingham 624xx Decatur 625xx Springfield 627xx Centralia 628xx X ray, complete, two views 77 N/A Galena 610xx Alton 620xx Carbondale 629xx Radiologic examination, spine, minimum of four views N/A N/A N/A N/A N/A 80 N/A Radiologic examination, finger(s), minimum of two views N/A Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service ( 22

32 Table 6a Commonly Billed Physical Medicine Services: % By Which Fee Schedule Exceeds Average Price Paid a CPT Code Physical medicine Definition (abbreviated) Des Plaines 600xx Elgin 601xx 23 Evanston 602xx Oak Park 603xx Bolingbrook 604xx Downers Grove 605xx Therapeutic procedure one or more areas Manual therapy techniques Application of modality to one or more areas; electrical stimulation Application of modality to one or more areas; hot or cold packs Application of modality, ultrasound Galena 610xx Rockford 611xx Rock Island 612xx Streator 613xx Galesburg 614xx Pekin 615xx City of Chicago 606xx Peoria 616xx Niles 607xx Cicero 608xx Bloomington Champaign 617xx 618xx Therapeutic procedure one or more areas Manual therapy techniques Application of modality to one or more areas; electrical stimulation Application of modality to one or more areas; hot or cold packs Application of modality, ultrasound Alton 620xx East St. Louis 622xx Quincy 623xx Effingham 624xx Decatur 625xx Lincoln 626xx Springfield 627xx Centralia 628xx Therapeutic procedure one or more areas Manual therapy techniques Application of modality to one or more areas; electrical stimulation Application of modality to one or more areas; hot or cold packs Application of modality, ultrasound Carbondale 629xx Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service listed above ( a A positive number indicates that the fee schedule amount exceeds average price paid; a negative number indicates the reverse. Kankakee 609xx Mattoon 619xx

33 In some areas, the majority (60 to 90 percent) of the physical medicine services were paid at a rate higher than the fee schedule (Table 6b). See Effingham (zip 624), for example. In others, only about one-fourth of services were paid at a rate higher than the fee schedule for many of the services. See, for example, Galesburg (zip 614) or Rockford (zip 611). For common neurological testing services analyzed, the fee schedule was close to the average prices paid in a few areas, was up to 40 percent lower than prices paid in other areas, and was more than 50 percent higher than the average prices paid in still other areas (Table 7a). Similarly, there was a great deal of variation in the percent of services billed that were paid at rates higher than the fee schedule, ranging from less than 10 percent of services in some areas (see Des Plaines (zip 600), for example) to as much as 95 percent of services in still others (see Effingham (zip 624), for example) (Table 7b). POSSIBLE UNINTENDED CONSEQUENCES ARISING FROM 29 DIFFERENT FEE SCHEDULES IN ILLINOIS The Illinois workers compensation fee schedule is unique in its design setting different maximum reimbursement rates for the same services for 29 different areas of the state. Each area is defined according to the first 3 digits of the zip code where the service was delivered including 9 different fee schedules in the greater Chicago metropolitan area. Only 3 other states (Florida, New York, and Pennsylvania) have different workers compensation medical fee schedules for different parts of the state, and of those, the maximum number of areas is four. For example, there are more than twice as many workers compensation fee schedules in the Chicago metropolitan area than there are in the entire state of New York. The Illinois Medicare fee schedule sets different rates for four different geographic regions within Illinois. The use of 29 different area fee schedules sometimes leads to odd results. These oddities may create unintended incentives for providers to increase revenues by moving the site of service or otherwise zip-gaming the system. While these instances where 24

34 Table 6b Commonly Billed Physical Medicine Services: % That Were Paid at Prices above the Fee Schedule CPT Code Physical medicine Definition (abbreviated) Des Plaines 600xx Elgin 601xx Evanston 602xx Oak Park 603xx Bolingbrook 604xx Downers Grove 605xx Therapeutic procedure one or more areas Manual therapy techniques Application of modality to one or more areas; electrical stimulation Application of modality to one or more areas; hot or cold packs Application of modality, ultrasound Galena 610xx Rockford 611xx Rock Island 612xx Streator 613xx Galesburg 614xx Pekin 615xx City of Chicago 606xx Peoria 616xx Niles 607xx Cicero 608xx Bloomington Champaign 617xx 618xx Therapeutic procedure one or more areas Manual therapy techniques Application of modality to one or more areas; electrical stimulation Application of modality to one or more areas; hot or cold packs Application of modality, ultrasound Alton 620xx East St. Louis 622xx Quincy 623xx Effingham 624xx Decatur 625xx Lincoln 626xx Springfield 627xx Centralia 628xx Therapeutic procedure one or more areas Manual therapy techniques Application of modality to one or more areas; electrical stimulation Application of modality to one or more areas; hot or cold packs Application of modality, ultrasound Carbondale 629xx Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service ( Kankakee 609xx Mattoon 619xx 25

35 Table 7a Commonly Billed Neurological Testing Services: % By Which Fee Schedule Amount Exceeds Average Price Paid a CPT Code Definition (abbreviated) Neurological testing Des Plaines 600xx Elgin 601xx Evanston 602xx Oak Park 603xx Bolingbrook Downers Grove 604xx 605xx City of Chicago 606xx Niles 607xx Kankakee Nerve conduction, amplitude and latency/velocity study, sensory Nerve conduction, amplitude and latency/velocity study, each nerve, motor, with F-wave study N/A N/A Nerve conduction, amplitude and latency/velocity study, each nerve, motor 18 0 N/A N/A N/A Needle electromyography; one extremity with or without related paraspinal areas N/A N/A N/A N/A 8 Rockford Rock Island Streator Galesburg Pekin Peoria Bloomington Champaign Mattoon 611xx 612xx 613xx 614xx 615xx 616xx 617xx 618xx 619xx Nerve conduction, amplitude and latency/velocity study, sensory Nerve conduction, amplitude and latency/velocity study, each nerve, motor, with F-wave study 46 N/A -7-8 N/A Nerve conduction, amplitude and latency/velocity study, each nerve, motor N/A Needle electromyography; one extremity with or without related paraspinal areas 58 N/A 9 30 N/A Alton 620xx E. St. Louis 622xx Quincy 623xx Effingham 624xx Decatur 625xx Lincoln 626xx Springfield 627xx Centralia 628xx Carbondale 629xx Nerve conduction, amplitude and latency/velocity study, sensory Nerve conduction, amplitude and latency/velocity study, each nerve, motor, with F-wave study N/A Nerve conduction, amplitude and latency/velocity study, each nerve, motor Needle electromyography; one extremity with or without related paraspinal areas 0 N/A N/A N/A Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service listed above ( a A positive number indicates that the fee schedule amount exceeds average price paid; a negative number indicates the reverse. 609xx Galena 610xx 26

36 Table 7b Commonly Billed Neurological Testing Services: % That Were Paid at Prices above the Fee Schedule CPT Code Definition (abbreviated) Des Plaines 600xx Elgin 601xx Evanston 602xx Oak Park 603xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx Niles 607xx Kankakee 609xx Galena 610xx Neurological testing Nerve conduction, amplitude and latency/velocity study, sensory Nerve conduction, amplitude and latency/velocity study, each nerve, motor, with F-wave study 8 13 N/A N/A Nerve conduction, amplitude and latency/velocity study, each nerve, motor N/A N/A N/A Needle electromyography; one extremity with or without related paraspinal areas 1 17 N/A N/A N/A N/A 43 Rockford 611xx Rock Island 612xx Streator 613xx Galesburg 614xx Pekin 615xx Peoria 616xx Bloomington 617xx Champaign 618xx Mattoon 619xx Nerve conduction, amplitude and latency/velocity study, sensory Nerve conduction, amplitude and latency/velocity study, each nerve, motor, with F-wave study 6 N/A N/A Nerve conduction, amplitude and latency/velocity study, each nerve, motor N/A Needle electromyography; one extremity with or without related paraspinal areas 4 N/A 41 2 N/A Alton 620xx East St. Louis 622xx Quincy 623xx Effingham 624xx Decatur 625xx Lincoln 626xx Springfield 627xx Centralia 628xx Carbondale 629xx Nerve conduction, amplitude and latency/velocity study, sensory Nerve conduction, amplitude and latency/velocity study, each nerve, motor, with F-wave study N/A Nerve conduction, amplitude and latency/velocity study, each nerve, motor Needle electromyography; one extremity with or without related paraspinal areas 55 N/A N/A N/A Note: N/A means there were less than 30 occurrences of the listed service. We do not report such values. Excluded areas do not have at least 30 occurrences of any of these services. See Tables SA.600 through SA.629 for more detail showing the average price and fee schedule price for each service ( 27

37 neighboring areas have widely disparate fees are not pervasive, they occur with sufficient frequency that one might question the wisdom of having so many different reimbursement rates, especially within a single metropolitan area. To illustrate the nature of this concern, and also that it occurs with some frequency, we provide 15 examples below from the 2006 Illinois fee schedule, focusing largely, but not exclusively, on the Chicago metropolitan area (Table 8). See Table SA.2 in the Statistical Appendix ( for the fee schedule amounts for these services in all 29 areas. Based on the 2006 Illinois fee schedule: 1. The fee schedule amount for shoulder surgery performed in Oak Park ($5,489) is $2,300 more than for the same surgery in Evanston ($3,170), a distance of 15 miles. 2. The fee schedule amount for a lumbar laminotomy performed in Niles ($8,502) is $1,500 more than for the same surgery performed in the City of Chicago ($7,009), a distance of 17 miles. 3. The fee schedule amount for a lumbar MRI is $550 more in Downers Grove ($2,010) than the same MRI in the City of Chicago ($1,458), a distance of 23 miles. 4. The fee schedule amount for an emergency room visit in Oak Park is $332 compared with $188 in Evanston. 5. The fee schedule amount for a cold pack is $19 in Oak Park compared with $33 in Des Plaines or the City of Chicago. 6. The fee schedule amount for a carpal tunnel surgery performed in Elgin ($2,236) is $750 more than for the same surgery in Evanston ($1,488), a distance of 31 miles. 7. The fee schedule amount for a knee arthroscopic surgery performed in Elgin ($4,683) is $1,600 more than for the same surgery in Evanston ($3,073). 8. The fee schedule amount for a knee arthroscopic surgery performed in Bolingbrook ($4,156) is $1,000 more than the same surgery if done in Oak Park ($3,157), yet the reimbursement for a shoulder arthroscopy is nearly $700 higher in Oak Park ($5,489) than in Bolingbrook ($4,818). 9. A lumbar steroidal injection performed in Bolingbrook ($834) is $150 more than the same injection in Downers Grove ($688), a distance of 13 miles. 28

38 Table 8 Fee Schedule Prices Top 5 Most Frequently Billed Codes in Each Service Group Eleven Different Illinois Zip Code Areas (Metropolitan Chicago, Champaign, East St. Louis) a CPT Code Definition (abbreviated) Des Plaines 600xx Elgin 601xx Evanston 602xx Oak Park 603xx Bolingbrook 604xx Downers Grove 605xx City of Chicago 606xx Niles 607xx Cicero 608xx Champaign 618xx East St. Louis 622xx Emergency Emergency department visit (expanded) $236 $202 $188 $332 $218 $236 $189 $226 $189 $205 $ Emergency department visit (low complexity) $146 $132 $99 $236 $149 $141 $122 $102 $118 $138 $ Emergency department visit (detailed) $333 $325 $301 $422 $317 $350 $283 $392 $265 $313 $ Emergency department visit (comprehensive) $527 $521 $442 $548 $486 $491 $442 $472 $378 $453 $ Emergency department visit (problem focused) $102 $94 $88 $142 $85 $99 $93 $85 $85 $95 $125 Evaluation and management Office visit, established patient (expanded) $85 $83 $94 $85 $79 $82 $92 $85 $80 $88 $ Office visit, established patient (detailed) $128 $123 $146 $137 $123 $125 $136 $121 $132 $132 $ Office visit, established patient (problem focused) $66 $62 $75 $64 $61 $62 $70 $71 $62 $65 $ Office visit, new patient (detailed problem focused) $151 $142 $156 $162 $144 $143 $160 $142 $128 $142 $ Office visit, new patient (comprehensive) $213 $201 $223 $198 $198 $201 $228 $189 $182 $203 $161 Major radiology MRI, lumbar without contrast $1,366 $1,605 $1,366 $1,318 $1,559 $2,010 $1,458 $1,370 $1,606 $2,116 $1, MRI, lower extremity without contrast $1,247 $1,511 $1,247 $1,318 $1,524 $1,649 $1,417 $1,370 $1,030 $1,776 $1, MRI, upper extremity without contrast $1,277 $1,550 $1,277 $1,318 $1,417 $1,771 $1,370 $1,443 $1,030 $1,861 $1, MRI, cervical without contrast $1,318 $1,559 $1,318 $1,318 $1,559 $1,582 $1,417 $1,370 $1,370 $2,097 $1, _26 MRI, upper extremity without contrast-professional component $255 $310 $255 $264 $283 $354 $274 $289 $206 $372 $208 Minor radiology Radiologic examination, finger(s), minimum of two views $83 $81 $83 $83 $77 $80 $85 $94 $72 $91 $ X ray, complete, two views $113 $135 $113 $134 $118 $143 $132 $132 $127 $165 $ Radiologic examination, complete, minimum of three views $106 $113 $106 $115 $99 $107 $112 $106 $156 $123 $ Radiologic examination, hand, minimum of three views $109 $112 $94 $112 $95 $106 $111 $106 $94 $123 $ Radiologic examination, ankle, complete, minimum of three views $106 $104 $90 $115 $105 $113 $112 $113 $124 $128 $66 Neurological testing Nerve conduction, sensory $165 $118 $58 $118 $146 $189 $165 $113 $118 $213 $ Nerve conduction with F-wave $236 $213 $148 $184 $189 $269 $236 $115 $189 $335 $ Nerve conduction without F-wave $142 $123 $105 $142 $146 $176 $173 $113 $113 $213 $ Electromyography one extremity $331 $281 $157 $217 $325 $307 $283 $472 $331 $373 $ Range of motion measurements and report $71 $85 $71 $105 $74 $85 $80 $71 $33 $61 $71 Physical medicine Therapeutic procedure one or more areas $57 $59 $47 $57 $57 $47 $61 $55 $57 $64 $ Application of modality to one or more areas; hot or cold packs $33 $28 $21 $19 $24 $28 $33 $21 $24 $24 $ Manual therapy techniques $54 $53 $47 $49 $55 $55 $61 $54 $47 $59 $ Application of modality to one or more areas; electrical stimulation $38 $37 $25 $29 $33 $33 $38 $42 $38 $28 $ Application of modality, ultrasound $43 $43 $33 $33 $38 $38 $43 $41 $39 $33 $33 Major surgery Arthroscopy with meniscectomy (knee) $3,433 $4,683 $3,073 $3,157 $4,156 $3,797 $3,779 $3,995 $3,486 $4,024 $2, Neuroplasty and/or transposition; carpal tunnel $2,220 $2,236 $1,488 $1,653 $2,182 $2,196 $2,231 $2,173 $2,173 $2,390 $1, Arthroscopy with partial acromioplasty (shoulder) $3,610 $4,670 $3,170 $5,489 $4,818 $3,741 $3,779 $3,170 $3,170 $3,892 $2, Arthroscopy debridement/shaving of articular cartilage $2,757 $3,779 $2,585 $3,779 $3,117 $3,241 $3,127 $2,585 $2,721 $3,533 $2, Lumbar laminotomy, one interspace $7,627 $7,557 $5,668 $7,557 $7,356 $7,312 $7,009 $8,502 $8,502 $7,066 $4,912 Surgical treatment Arthrocentesis, major joint or bursa $198 $199 $198 $175 $156 $176 $203 $189 $222 $165 $ Injection, single, lumbar, sacral $708 $708 $718 $652 $834 $688 $748 $661 $708 $756 $ Simple repair of superficial wounds of scalp, neck, axillae, external genitalia, trunk, hands, and feet $277 $274 $314 $269 $260 $254 $256 $279 $225 $246 $ Injection, single tendon sheath $156 $154 $178 $142 $142 $149 $185 $198 $123 $142 $ Arthrocentesis, intermediate joint or bursa $176 $168 $176 $140 $132 $146 $176 $179 $128 $146 $113 a Fees for these services in all 29 areas can be found in Table SA.2 in the Statistical Appendix ( A more complete description of each zip code area can be found on the Illinois Workers' Compensation Commission's Web site at under "FAQ - What is a geozip." Fees for other services and other zip code areas can also be found there. Key: CPT: current procedural terminology; MRI: magnetic resonance imaging. 29

39 10. A lumbar steroidal injection performed in Alton ($1,039) is $300 more than the same injection in the City of Chicago ($748). One might expect provider expenses to be higher in the City of Chicago than in Alton. 11. The fee schedule amount for a lumbar MRI without contrast performed in Champaign is $2,116, compared with $1,458 in the City of Chicago. 12. The fee schedule amount for a cold pack is $43 in Rockford compared with $33 in the City of Chicago. Again, one would not expect provider expenses to be higher in Rockford than in the City of Chicago. 13. The fee schedule amount for sensory nerve conduction testing in Oak Park is $118 compared with $58 in Evanston. 14. The fee schedule amount for a lumbar injection performed in the areas north of East St. Louis is $1,039 compared with $582 in East St. Louis. 15. The fee schedule amount for a lumbar laminotomy performed in Champaign is $7,066 compared with $5,472 in Mattoon. For most common services, the areas with the highest fee schedules were not the areas where market conditions led to the highest prices having been paid in workers compensation. Again, it is important to note that the fee schedule was developed based on group health charges which may have also differed from workers compensation charges and workers compensation prices paid. Nonetheless, we found that higher fee schedule amounts were sometimes found in the local areas with historically higher prices paid, but frequently they were not. Prices paid are determined by local market conditions, including the supply of and demand for different providers services, the rates paid by group health payors, and negotiated workers compensation prices between payors and workers compensation networks. If areas with higher (lower) prices actually paid had higher (lower) fee schedule amounts, we would say that the fee schedule was rationally related to the local market conditions. For some common services, we observed no rational relationship between the fee schedule and prices actually paid for some services, for others the relationship was weak, and for still others the relationship was stronger. But across most common services analyzed, the higher fee schedule areas frequently were not the areas with proportionately higher prices actually paid. With a fee schedule based on charges (like Illinois), this could occur if charges are not well-reflective of true market 30

40 conditions. This is similar to the sticker price on an automobile, where the true price is closer to the sticker price for cars where demand exceeds supply, but not for slower sellers. We illustrate below with a few examples showing that the areas with the highest fee schedules were not the areas where market conditions led to the highest prices having been paid. 7 Table 9 lists the four highest and lowest fee schedule areas in Illinois 2006 fee schedule for one of the most common nerve testing procedures (CPT Electromyography) among the 19 areas where we have at least 30 occurrences of that procedure. The fee schedule amounts in the four highest regions were much higher than in the four lowest regions in 2006 at least 60 percent higher. However, the average prices paid were similar across the areas. For example, the fee schedule amount for the highest area (618-Champaign) was $373 while the fee schedule amount for the lowest area (624-Effingham) was less than half $ The average price paid in these two areas was quite similar $212 and $214 respectively. Table 9 Fee Schedules Compared to Price Paid for Electromyography (CPT 95860) in Highest and Lowest Fee Schedule Areas a CPT: Electromyography, one extremity Area Highest Fee Schedule Fee Schedule Amount Average Price Paid Area Lowest Fee Schedule Fee Schedule Amount Average Price Paid Champaign 618 $373 $212 Effingham 624 $154 $214 Bloomington 617 $345 $217 Mattoon 619 $189 $222 Des Plaines 600 $331 $206 Alton 620 $198 $198 Springfield 627 $331 $204 Centralia 628 $208 $225 Note: Further detail for these and other areas and services can be found in Statistical Appendix Tables SA.600 through SA.629 ( a These are the highest and lowest fee schedule areas among the 19 areas where we observe at least 30 occurrences of the procedure. 7 Table SA.2 in the Statistical Appendix ( shows the fee schedule values for all 29 areas for the most commonly billed services in each service category. 8 The fee schedule across all 29 areas ranges from $154 to $

41 Table 10 shows the lowest and highest fee schedule areas for an arthroscopic shoulder surgery. In our database, there are 22 areas with at least 30 arthroscopic shoulder surgeries. For shoulder surgeries, the 2006 fee schedule amounts in the highest areas were approximately double those in the lowest areas; yet the average prices paid in the three highest and three lowest fee schedule areas were quite similar. Table 10 Fee Schedules Compared to Price Paid for Shoulder Arthroscopy (CPT 29826) in Highest and Lowest Fee Schedule Areas a CPT: Arthroscopy with partial acromioplasty (shoulder) Area Highest Fee Schedule Fee Schedule Amount Average Price Paid Area Lowest Fee Schedule Fee Schedule Amount Average Price Paid Bolingbrook 604 $4,818 $2,517 East St. Louis 622 $2,343 $2,624 Elgin 601 $4,670 $2,796 Alton 620 $2,551 $2,656 City of Chicago 606 $3,779 $2,917 Centralia 628 $2,777 $2,774 Downers Grove 605 $3,741 $2,210 Peoria 616 $2,858 $2,903 Note: Further detail for these and other areas and services can be found in Statistical Appendix Tables SA.600 through SA.629 ( a These are the highest and lowest fee schedule areas among the 22 areas where we observe at least 30 occurrences of the procedure. INDEXING THE FEE SCHEDULE TO THE CONSUMER PRICE INDEX MAY REDUCE THE RATE OF GROWTH By statute, the annual increases in the fee schedule amounts are tied to the change in the U.S. CPI. Using WCRI s database of workers compensation prices paid, 9 we have found that workers compensation medical prices actually paid in Illinois have historically grown by 3 to 4 percentage points per year faster than the CPI. Where the fee schedule levels are binding on the actual prices paid and unless offset by changes in billing and treatment practices by providers, we would expect this approach to dampen the increase in prices paid compared to what the increases would have been without the fee schedule. Figure 5 shows that the CPI grew at an annual rate of between 1.5 to 3.5 percent each year from 1999 to At the same time, average workers compensation medical 9 The source of data are described in more detail in the Methods and Data and do not include prices for pharmaceuticals or hospitals. 32

42 prices in Illinois grew at a consistent annual rate of between 5 and 6 percent per year over the same period. Charges grew even more rapidly. Reimbursements that are based on a discount from charges (76 percent of charges) would be expected to increase faster than those bound by the fee schedule. Figure 5 CPI Grew 3-4% More Slowly Each Year Than Average Prices Paid Annual % Change 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% CPI Average WC Charges* Average WC Price Paid* *Source is WCRI s Detailed Benchmark/Evaluation (DBE) database of workers compensation medical charges and payments. See Methods and Data section below for more information on data. METHODS AND DATA The data come from 12 insurers and TPAs whose business represents 52 percent of the market in Illinois. To test the representativeness of these data, we take a number of measures derived from the data and reconcile them with data that represents a broader set of payors. This external validation is described in Telles, Wang, and Tanabe (2006). 33

43 SCOPE OF ANALYSIS This analysis covers the workers compensation medical fee schedule in Illinois for services billed under CPT codes by nonhospital providers. It does not analyze the schedule governing hospital or nonhospital facility fees. In Illinois, in 2003, payments to nonhospital providers made up approximately 56 percent of Illinois workers compensation medical expenditures, and payments to hospitals made up to 44 percent. The nonhospital fee schedule in Illinois covers several areas of medical services listed in Table 11. This study analyzes the services covering 82 percent of workers compensation nonhospital expenditures. The Illinois fee schedule covers thousands of CPT codes in the general categories broken out in the top half of Table 11. Some nonhospital services are not covered by this analysis, either because they are not part of the Illinois fee schedule or covered by the Medicare fee schedule, or because they are too broadly defined to make CPT level price comparisons. The excluded nonhospital services make up 18 percent of total nonhospital expenditures. Table 11 Coverage of Illinois Medical Fee Schedule Analysis Services covered in WCRI analysis (82% of nonhospital expenditures; 46% of all medical expenditures including hospital) 1 General surgery 2 Orthopedic surgery 3 Physical and occupational therapy 4 Radiology (minor and major) 5 General medicine, including evaluation and management 6 Emergency 7 Neurological/neuromuscular testing 8 Chiropractic care Services not covered in WCRI analysis (18% of nonhospital expenditures, 54% of all medical expenditures including hospital) 1 Home health care 2 Dentistry 3 Anesthesia 4 Pharmaceuticals and supplies 5 Pathology services 6 Inpatient and outpatient hospital services 7 Ambulatory surgery centers 34

44 THE MARKETBASKET APPROACH AND REPRESENTATIVENESS The basic approach used is similar to that used to construct a consumer price index. We began by constructing a marketbasket of the most commonly used medical services for treating workers compensation patients. The approach and methods used are the same as those explained in detail in Benchmarks for Designing Workers Compensation Medical Fee Schedules: (Eccleston et al., 2002). This approach is briefly summarized here. Within each service group, the marketbasket of services chosen represent anywhere from 70 to 92 percent of the expenditures in that service group. Generally, the top five or six codes represent the majority of payments within each group. Table 12 shows that the marketbasket used to make comparisons of the Illinois fee schedule to Medicare and to other state workers compensation fee schedules contains 251 codes representing 87 percent of the nonhospital expenditures included in the analysis (because our analysis is based on 82 percent of total nonhospital expenditures, the marketbasket covers approximately 71 percent of total nonhospital expenditures). Table 12 Summary of Marketbasket and Representation Service Group Number of Codes Included in Marketbasket Percent of Service Group Expenditures Covered by Marketbasket Codes Service Group Expenditure Weights Major surgery Treatment surgery Evaluation and management Emergency Physical medicine and chiropractic Major radiology Minor radiology Neurologic/neuromuscular testing Overall CREATING THE MARKETBASKET WCRI used the DBE database to create a marketbasket common across all states using the actual distribution of services provided to workers in 2003/2004. Within each service group we choose the medical services with the highest expenditures until we achieve 80 35

45 percent or more for most categories. Codes chosen must also be codes that are included in the Medicare fee schedule. As mentioned above, the methods used and sensitivity tests for different state marketbaskets are detailed further in an earlier report entitled Benchmarks for Designing Workers' Compensation Medical Fee Schedules: CREATING THE FEE SCHEDULE INDEX The methods used are comparable to creating the CPI. Each service (CPT code) within the marketbasket is assigned a weight based on the frequency with which it occurs in the data. The fees are compared for each CPT code for the Illinois workers compensation fee schedule and Illinois Medicare. The frequency weights for each CPT code are used to compute the average fee within each service group. For the analysis that compares the Illinois fee schedule to other states, we use a set of frequency and expenditure weights that reflect a multistate average for these weights; but for the analyses that focus on the 29 different Illinois fee schedules compared to Illinois Medicare and Illinois average prices, we used Illinois specific weights. The service group fee indices are then weighted by their expenditure weights to create the overall fee. The expenditure weights for each service group can be found in Table 12. These indices are created for each of the 29 areas in Illinois for which there is a fee schedule. We used a single, state-wide set of frequency weights for all 29 areas. To aggregate the 29 indices into a single summary statewide index, we weighted each area index by its share of the state s employed population (U.S. Census Bureau Digit ZCTA employed numbers). The population weights can be found in Table 13. We applied similar weights from Bureau of Labor Statistics 2000 Employment population numbers to each county of the Illinois Medicare fees to estimate Illinois state Medicare fees for the marketbasket codes. 36

46 Table 13 Distribution of Employment Population by the 29 Geozips in Illinois 3-Digit Zip Code a Employed number Percent , , , , , , ,213, , , , , , , , , , , , , , , , , , , , , , , Total 5,833, a A description of the 3-digit zip code areas can be found on the Illinois Workers Compensation Commission's Web site at under "FAQ - What is a geozip." Source: U.S. Census Bureau digit ZCTA employed numbers. 37

47 ANALYSIS OF PRICES PAID IN ILLINOIS We compared the actual prices paid in Illinois to the Illinois fee schedule levels for the marketbasket of services. The price data also come from the WCRI DBE database which includes information on the price actually paid for each CPT code billed. 10 The database used in this analysis contains approximately 32,000 Illinois claims drawn from carriers and TPAs that represent approximately 52 percent of the market in Illinois. This analysis includes 17,000 of these claims that have data that are sufficiently complete on medical prices paid. The data on prices include prices paid in In order to approximate the prices paid in 2006 in Illinois, we inflate the 2003 Illinois prices at the service group level by the historical annual average percentage change in prices for each service group observed from 1999 through 2003 on average, 5.4 percent for each of two years. (See Table SA.3 at To correspond to the Illinois workers compensation fee schedule by 29 zip code areas, we computed prices paid in Illinois by the same zip areas. The majority (77 percent) of services billed were from 5 of the 29 areas: zip 606 (City of Chicago), 27 percent; zip 601 (Elgin), 16 percent; zip 604 (Bolingbrook), 15 percent; zip 600 (Des Plaines), 12 percent; and zip 605 (Downers Grove), 8 percent. The rest of the 24 areas accounted for 23 percent of billed services in price data. As a result, most procedures in the other areas have relatively small numbers of occurrences potentially introducing notable random error into the estimates of prices. To examine this possibility, we calculated the coefficient of variation of each marketbasket code by area to see how the variation of price was distributed within these areas, given the small number of services for most areas of Illinois. Based on this analysis, we elected to present the average prices only for areas and services where there were at least 30 occurrences of a service. This eliminated most services for many areas. As a result, we report only the top 3 or 4 most frequently billed services, and only for areas where there were at least 30 occurrences. 10 The data on prices reflect the prices paid, not the prices charged. These are prices after network and negotiated discounts. If data sources in the DBE database are more sophisticated than average and have higher network penetration rates, the prices that we report understate the actual statewide average. The payments to network providers in WCRI s database for Illinois represent 41 percent of the total medical payments for services included in this study. 38

48 For many of the physical medicine services or neurological testing services which are based on a 15 minute time interval or per nerve basis, the billing and payment is made at a multiple time or nerve basis. The payment data used to estimate prices paid must reflect these multiple units. In addition, for minor radiology or major radiology services, the modifiers which identify the service as just the professional or technical component may be missing, causing the average payment to be lower than they otherwise would be for the whole procedure. We applied the standard data cleaning algorithm used in previous WCRI studies to identify and truncate implausible outliers, possible multiple units of service for physical medicine and neurological testing services, and missing modifiers for major and minor radiology services. We can not be certain that every instance is caught and corrected. Where they are not, the average prices paid for neurological testing and physical medicine could be overstated and the average prices paid for radiology services could be understated. We believe the data have been sufficiently cleaned so as to minimize this effect. These cleaning algorithms are further described in Wang and Zhao (2003) and Eccleston (2005, 2006). 39

49 REFERENCES Eccleston, S How does the Massachusetts medical fee schedule compare to prices actually paid in workers' compensation? Cambridge, MA: Workers Compensation Research Institute. Eccleston, S., A. Laszlo, X. Zhao, and M. Watson Benchmarks for designing workers' compensation medical fee schedules: Cambridge, MA: Workers Compensation Research Institute. Eccleston, S. and X. Zhao The anatomy of workers compensation medical costs and utilization, 5th edition. 10 vols. Cambridge, MA: Workers Compensation Research Institute. Eccleston, S., P. Petrova, and X. Zhao. Forthcoming. The anatomy of workers compensation medical costs and utilization, 6th edition. 10 vols. Cambridge, MA: Workers Compensation Research Institute. Ingenix, Inc Official Illinois Workers Compensation Commission fee schedule. Illinois Workers Compensation Commission. Retrieved from (accessed April 12, 2006). Physician Payment Review Commission Annual report Washington, DC. Telles, C., D. Wang, and R. Tanabe CompScope benchmarks, 6th edition. 9 vols. Cambridge, MA: Workers Compensation Research Institute. U.S. Census Bureau. American FactFinder. Retrieved from (accessed April 12, 2006). U.S. Congress. House. Committee on Energy and Commerce Medicare Prescription Drug, Improvement, and Modernization Act of th Cong., 1st sess. H.R.1. Wang, D. and X. Zhao WCRI medical price index for workers' compensation. Cambridge, MA: Workers Compensation Research Institute. 40

50 OTHER WCRI PUBLICATIONS MEDICAL COSTS, UTILIZATION AND HEALTH CARE DELIVERY state policies affecting the cost and use of pharmaceuticals in workers compensation: a national inventory. Richard A. Victor and Petia Petrova. June wc the cost and use of pharmaceuticals in workers compensation: a guide for policymakers. Richard A. Victor and Petia Petrova. June wc how does the Massachusetts fee schedule compare to prices actually paid in workers compensation? Stacey M.Eccleston. April wc the anatomy of workers compensation medical costs and utilization in california, 5th edition. Stacey M.Eccleston and Xiaoping Zhao. November wc the anatomy of workers compensation medical costs and utilization in florida, 5th edition. Stacey M.Eccleston and Xiaoping Zhao. November wc the anatomy of workers compensation medical costs and utilization in louisiana, 5th edition. Stacey M.Eccleston and Xiaoping Zhao. November wc the anatomy of workers compensation medical costs and utilization in massachusetts, 5th edition. Stacey M. Eccleston and Xiaoping Zhao. November wc the anatomy of workers compensation medical costs and utilization in north carolina, 5th edition. Stacey M. Eccleston and Xiaoping Zhao. November wc the anatomy of workers compensation medical costs and utilization in pennsylvania, 5th edition. Stacey M. Eccleston, Dongchun Wang, and Xiaoping Zhao. November 2005.WC the anatomy of workers compensation medical costs and utilization in tennessee, 5th edition. Stacey M.Eccleston and Xiaoping Zhao. November wc

51 the anatomy of workers compensation medical costs and utilization in texas, 5th edition. Stacey M. Eccleston and Xiaoping Zhao. November wc the anatomy of workers compensation medical costs and utilization in wisconsin, 5th edition. Stacey M. Eccleston, Dongchun Wang, and Xiaoping Zhao. November wc the impact of provider choice on workers compensation costs and outcomes. Richard A. Victor, Peter S. Barth, and David Neumark, with the assistance of Te-Chun Liu. November wc adverse surprises in workers compensation: cases with significant unanticipated medical care and costs. Richard A. Victor. June wc wcri flashreport: analysis of the proposed workers compensation fee schedule in tennessee. Stacey M. Eccleston and Xiaoping Zhao. January fr wcri flashreport: analysis of services delivered at chiropractic visits in texas compared to other states. Stacey M. Eccleston and Xiaoping Zhao. July fr wcri flashreport: supplement to benchmarking the 2004 pennsylvania workers compensation medical fee schedule. Stacey M. Eccleston and Xiaoping Zhao. May fr wcri flashreport: is chiropractic care a cost driver in texas? reconciling studies by wcri and mgt/texas chiropractic association. April fr wcri flashreport: potential impact of a limit on chiropractic visits in texas. Stacey M. Eccleston. April fr wcri flashreport: are higher chiropractic visits per claim driven by outlier providers? Richard A. Victor. April fr wcri flashreport: benchmarking the 2004 pennsylvania workers compensation medical fee schedule. Stacey M. Eccleston and Xiaoping Zhao. March fr evidence of effectiveness of policy levers to contain medical costs in workers compensation. Richard A. Victor. November wc wcri medical price index for workers compensation. Dongchun Wang and Xiaoping Zhao. October wcë03ë05. wcri flashreport: where the medical dollar goes? how california compares to other states. Richard A. Victor and Stacey M. Eccleston.March fr patterns and costs of physical medicine: comparison of chiropractic and physician-directed care. Richard A. Victor and DongchunWang. December wc

52 provider choice laws, network involvement, and medical costs. Richard A. Victor, DongchunWang, and Philip Borba. December wc wcri flashreport: analysis of payments to hospitals and surgery centers in florida workers compensation. Stacey M. Eccleston and Xiaoping Zhao. December fr benchmarks for designing workers compensation medical fee schedules: Stacey M. Eccleston, Aniko Laszlo, Xiaoping Zhao, and Michael Watson. August wc wcri flashreport: changes in michigan s workers compensation medical fee schedule: Stacey M. Eccleston. December fr targeting more costly care: area variation in texas medical costs and utilization. Richard A. Victor and N. Michael Helvacian.May wc wcri flashreport: comparing the pennsylvania workers compensation fee schedule with medicare rates: evidence from 160 important medical procedures. Richard A. Victor, Stacey M. Eccleston, and Xiaoping Zhao. November fr wcri flashreport: benchmarking pennsylvania s workers compensation medical fee schedule. Stacey M. Eccleston and Xiaoping Zhao. October fr wcri flashreport: benchmarking california s workers compensation medical fee schedules. Stacey M. Eccleston. August fr managed care and medical cost containment in workers compensation: a national inventory, Ramona P. Tanabe and Susan M.Murray. December wc wcri flashreport: benchmarking florida s workers compensation medical fee schedules. Stacey M. Eccleston and Aniko Laszlo. August fr the impact of initial treatment by network providers on workers compensation medical costs and disability payments. Sharon E. Fox, Richard A. Victor, Xiaoping Zhao, and Igor Polevoy. August dm the impact of workers compensation networks on medical and disability payments.william G. Johnson, Marjorie L. Baldwin, and Steven C.Marcus. November wc fee schedule benchmark analysis: ohio. Philip L. Burstein. December fs the rbrvs as a model for workers compensation medical fee schedules: pros and cons. Philip L. Burstein. July wc benchmarks for designing workers compensation medical fee schedules:

53 Philip L. Burstein.May wc fee schedule benchmark analysis: north carolina. Philip L. Burstein. December fs fee schedule benchmark analysis: colorado. Philip L. Burstein. August fs benchmarks for designing workers compensation medical fee schedules: Philip L. Burstein. December wc review, regulate, or reform: what works to control workers compensation medical costs. Thomas W. Grannemann, ed. September wc fee schedule benchmark analysis: michigan. Philip L. Burstein. September fs medicolegal fees in california: an assessment. Leslie I. Boden.March wc benchmarks for designing workers compensation medical fee schedules. Stacey M. Eccleston, Thomas W. Grannemann, and James. F. Dunleavy. December wc how choice of provider and recessions affect medical costs in workers compensation. Richard B. Victor and Charles A. Fleischman. June wcë90ë2. medical costs in workers compensation: trends & interstate comparisons. Leslie I. Boden and Charles A. Fleischman. December wc WORKER OUTCOMES comparing outcomes for injured workers in seven large states. Sharon E. Fox, Richard A. Victor, and Te-Chun Liu, with the assistance of Pinghui Li. February wc wcri flashreport: worker outcomes in texas by type of injury. Richard A. Victor. February fr outcomes for injured workers in california, massachusetts, pennsylvania, and texas. Richard A. Victor, Peter S. Barth, and Te-Chun Liu, with the assistance of Pinghui Li. December wc outcomes for injured workers in texas. Peter S. Barth and Richard A. Victor, with the assistance of Pinghui Li and TeËChun Liu. July wc the workers story: results of a survey of workers injured in wisconsin.monica Galizzi, Leslie I. Boden, and Te-Chun Liu. December wc-98-5.

54 workers compensation medical care: effective measurement of outcomes. Kate Kimpan. October wcë96ë7. BENEFITS AND RETURN TO WORK Factors that influence the amount and probability of permanent partial disability benefits, Philip S. Borba, and Mike Helvacian. June wc return-to-work outcomes of injured workers: evidence from california, massachusetts, pennsylvania, and texas. Sharon E. Fox, Philip S. Borba, and Te-Chun Liu.May wc who obtains permanent partial disability benefits: a six state analysis. Peter S. Barth, N.Michael Helvacian, and Te-Chun Liu. December wcë02ë04. wcri flashreport: benchmarking oregon s permanent partial disability benefits. Duncan S. Ballantyne and Michael Manley. July fr wcri flashreport: benchmarking florida s permanent impairment benefits. Richard A. Victor and Duncan S. Ballantyne. September fr permanent partial disability benefits: interstate differences. Peter S. Barth and Michael Niss. September wc measuring income losses of injured workers: a study of the wisconsin system A WCRI Technical Paper. Leslie I. Boden and Monica Galizzi. November permanent partial disability in tennessee: similar benefits for similar injuries? Leslie I. Boden. November wc what are the most important factors shaping return to work? evidence from wisconsin.monica Galizzi and Leslie I. Boden. October wc do low ttd maximums encourage high ppd utilization: re-examining the conventional wisdom. John A. Gardner. January wc benefit increases and system utilization: the connecticut experience. John A. Gardner. December wcë91ë5. designing benefit structures for temporary disability: a guide for policymakers Two-Volume Publication. Richard B. Victor and Charles A. Fleischman. December wc return to work incentives: lessons for policymakers from economic studies. John A. Gardner. June wcë89ë2. income replacement for long-term disability: the role of workers compensation and ssdi. Karen R. DeVol. December sp-86-2.

55 COST DRIVERS AND BENCHMARKS OF SYSTEM PERFORMANCE Baselines for evaluating the impact of the 2005 reforms in texas: compscope benchmarks, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevoy. June wc Baselines for evaluating the impact of the 2003 reforms in floirda: compscope benchmarks, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevoy. February wc Baselines for evaluating the impact of the 2004 reforms in Tennessee: compscope benchmarks, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Eric Harrison and Igor Polevoy. February wc Baselines for evaluating the impact of the reforms in california: compscope benchmarks, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevoy. February wc Compscope benchmarks for louisiana, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevoy. February wc Compscope benchmarks for maryland, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevoy. February wc Compscope benchmarks for massachusetts, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevoy. February wc Compscope benchmarks for north carolina, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevey. February wc Compscope benchmarks for pennsylvania, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevoy. February wc Compscope benchmarks for wisconsin, 6th edition. Carol A. Telles, Dongchun Wang, and Ramona P. Tanabe, with the assistance of Igor Polevaoy. February wc why are benefit delivery expenses higher in california and florida? Duncan S. Ballantyne and Carol A. Telles. December wc

56 Compscope benchmarks: massachusetts, Carol A. Telles, Aniko Laszlo, and Te-Chun Liu. January cs Compscope benchmarks: florida, N.Michael Helvacian and Seth A. Read. September cs wcri flashreport: where the workers compensation dollar goes. Richard A. Victor and Carol A. Telles. August fr predictors of multiple workers compensation claims in wisconsin. Glenn A. Gotz, Te-Chun Liu, and Monica Galizzi. November wc area variations in texas benefit payments and claim expenses. Glenn A. Gotz, Te-Chun Liu, Christopher J. Mazingo, and Douglas J. Tattrie.May wc area variations in california benefit payments and claim expenses. Glenn A. Gotz, Te-Chun Liu, and Christopher J.Mazingo.May wc area variations in pennsylvania benefit payments and claim expenses. Glenn A. Gotz, Te-Chun Liu, and Christopher J.Mazingo.May wc benchmarking the performance of workers compensation systems: compscope measures for minnesota. H. Brandon Haller and Seth A. Read. June cs benchmarking the performance of workers compensation systems: compscope measures for massachusetts. Carol A. Telles and Tara L. Nells. December cs benchmarking the performance of workers compensation systems: compscope measures for california. Sharon E. Fox and Tara L. Nells. December cs benchmarking the performance of workers compensation systems: compscope measures for pennsylvania. Sharon E. Fox and Tara L. Nells. November cs cost drivers and system performance in a court-based system: tennessee. John A. Gardner, Carol A. Telles, and Gretchen A.Moss. June wc the 1991 reforms in massachusetts: an assessment of impact. John A. Gardner, Carol A. Telles, and Gretchen A. Moss.May wc the impact of oregon s cost containment reforms. John A. Gardner, Carol A. Telles, and Gretchen A.Moss. February wc cost drivers and system change in georgia, John A. Gardner, Carol A. Telles, and Gretchen A.Moss. November wc cost drivers in missouri. John A. Gardner, Richard A. Victor, Carol A. Telles, and Gretchen A.Moss. December wc cost drivers in new jersey. John A. Gardner, Richard A. Victor, Carol A. Telles, and Gretchen A.Moss. September wc-94-4.

57 cost drivers in six states. Richard A. Victor, John A. Gardner, Daniel Sweeney, and Carol A. Telles. December wc performance indicators for permanent disability: low-back injuries in texas. Sara R. Pease. August wcë88ë4. performance indicators for permanent disability: low-back injuries in new jersey. Sara R. Pease. December wc performance indicators for permanent disability: low-back injuries in wisconsin. Sara R. Pease. December wc ADMINISTRATION/LITIGATION workers compensation in Hawaii: administrative inventory. Duncan S. Ballantyne. April wc workers compensation in arkansas: administrative inventory. Duncan S. Ballantyne. August wc workers compensation in mississippi: administrative inventory. Duncan S. Ballantyne.May wc workers compensation in arizona: administrative inventory. Duncan S. Ballantyne. September wc workers compensation in iowa: administrative inventory. Duncan S. Ballantyne. April wc wcri flashreport: measuring the complexity of the workers compensation dispute resolution processes in tennessee. Richard A. Victor. April fr revisiting workers compensation in missouri: administrative inventory. Duncan S. Ballantyne. December wc workers compensation in tennessee: administrative inventory. Duncan S. Ballantyne. April wc revisiting workers compensation in new york: administrative inventory. Duncan S. Ballantyne. January wc workers compensation in kentucky: administrative inventory. Duncan S. Ballantyne. June wc workers compensation in ohio: administrative inventory. Duncan S. Ballantyne. October wc workers compensation in louisiana: administrative inventory. Duncan S. Ballantyne. November wc-99-4.

58 workers compensation in florida: administrative inventory. Peter S. Barth. August wc measuring dispute resolution outcomes: a literature review with implications for workers compensation. Duncan S. Ballantyne and Christopher J.Mazingo. April wc revisiting workers compensation in connecticut: administrative inventory. Duncan S. Ballantyne. September wc dispute prevention and resolution in workers compensation: a national inventory, Duncan S. Ballantyne.May wc workers compensation in oklahoma: administrative inventory.michael Niss. April wc workers compensation advisory councils: a national inventory, 1997Ì1998. Sharon E. Fox.March wcë98ë1. the role of advisory councils in workers compensation systems: observations from wisconsin. Sharon E. Fox. November revisiting workers compensation in michigan: administrative inventory. Duncan S. Ballantyne and Lawrence Shiman. October wc revisiting workers compensation in minnesota: administrative inventory. Carol A. Telles and Lawrence Shiman. September wc revisiting workers compensation in california: administrative inventory. Carol A. Telles and Sharon E. Fox June wc revisiting workers compensation in pennsylvania: administrative inventory. Duncan S. Ballantyne.March wc revisiting workers compensation in washington: administrative inventory. Carol A. Telles and Sharon E. Fox. December wc workers compensation in illinois: administrative inventory. Duncan S. Ballantyne and Karen M. Joyce. November wc workers compensation in colorado: administrative inventory. Carol A. Telles and Sharon E. Fox. October wc workers compensation in oregon: administrative inventory. Duncan S. Ballantyne and James F. Dunleavy. December wc revisiting workers compensation in texas: administrative inventory. Peter S. Barth and Stacey M. Eccleston. April wc workers compensation in virginia: administrative inventory. Carol A. Telles and Duncan S. Ballantyne. April wc-94-3.

59 workers compensation in new jersey: administrative inventory. Duncan S. Ballantyne and James F. Dunleavy. April wc workers compensation in north carolina: administrative inventory. Duncan S. Ballantyne. December 1993 wc workers compensation in missouri: administrative inventory. Duncan S. Ballantyne and Carol A. Telles.May wc workers compensation in california: administrative inventory. Peter S. Barth and Carol A. Telles. December wc workers compensation in wisconsin: administrative inventory. Duncan S. Ballantyne and Carol A. Telles. November wc workers compensation in new york: administrative inventory. Duncan S. Ballantyne and Carol A. Telles. October wc the ama guides in maryland: an assessment. Leslie I. Boden. September wc workers compensation in georgia: administrative inventory. Duncan S. Ballantyne and Stacey M. Eccleston. September wc workers compensation in pennsylvania: administrative inventory. Duncan S. Ballantyne and Carol A. Telles. December wc reducing litigation: using disability guidelines and state evaluators in oregon. Leslie I. Boden, Daniel E. Kern, and John A. Gardner. October wc workers compensation in minnesota: administrative inventory. Duncan S. Ballantyne and Carol A. Telles. June wc workers compensation in maine: administrative inventory. Duncan S. Ballantyne and Stacey M. Eccleston. December wc workers compensation in michigan: administrative inventory. H. Allan Hunt and Stacey M. Eccleston. January wc workers compensation in washington: administrative inventory. Sara R. Pease. November wc workers compensation in texas: administrative inventory. Peter S. Barth, Richard B. Victor, and Stacey M. Eccleston.March wc reducing litigation: evidence from wisconsin. Leslie I. Boden. December wc workers compensation in connecticut: administrative inventory. Peter S. Barth. December wc-87-3.

60 use of medical evidence: low-back permanent partial disability claims in new jersey. Leslie I. Boden. December wc use of medical evidence: low-back permanent partial disability claims in maryland. Leslie I. Boden. September sp VOCATIONAL REHABILITATION improving vocational rehabilitation outcomes: opportunities for early intervention. John A. Gardner. August wc appropriateness and effectiveness of vocational rehabilitation in florida: costs, referrals, services, and outcomes. John A. Gardner. February wc vocational rehabilitation in florida workers compensation: rehabilitants, services, costs, and outcomes. John A. Gardner. February wc vocational rehabilitation outcomes: evidence from new york. John A. Gardner. December wc vocational rehabilitation in workers compensation: issues and evidence. John A. Gardner. June s OCCUPATIONAL DISEASE liability for employee grievances: mental stress and wrongful termination. Richard B. Victor, ed. October wc asbestos claims: the decision to use workers compensation and tort. Robert I. Field and Richard B. Victor. September wc OTHER the future of workers compensation: opportunities and challenges. Richard A. Victor, ed. April wc managing catastrophic events in workers compensation: lessons from 9/11. Ramona P. Tanabe, ed.march wc wcri flashreport: workers compensation in california: lessons from recent wcri studies. Richard A. Victor. March fr wcri flashreport: workers compensation in florida: lessons from recent wcri studies. Richard A. Victor. February fr

61 workers compensation and the changing age of the workforce. Douglas J. Tattrie, Glenn A. Gotz, and Te-Chun Liu. December wc medical privacy legislation: implications for workers compensation. Ramona P. Tanabe, ed. November wc the implications of changing employment relations for workers compensation. Glenn A. Gotz, ed. December wc workers compensation success stories. Richard A. Victor, ed. July wcë93ë3. the americans with disabilities act: implications for workers compensation. Stacey M. Eccleston, ed. July wc twenty-four-hour coverage. Richard A. Victor, ed. June wc These publications can be obtained by visiting our web site at or by sending a written request by fax to (617) Or by mail to: Publications Department Workers Compensation Research Institute 955 Massachusetts Avenue Cambridge, MA 02139

62 About the Institute The Workers Compensation Research Institute is a nonpartisan, not-for-profit research organization providing objective information about public policy issues involving workers compensation systems. The Institute does not take positions on the issues it researches; rather it provides information obtained through studies and data collection efforts that conform to recognized scientific methods, with objectivity further ensured through rigorous peer review procedures. The Institute s work helps those interested in improving workers compensation systems by providing new, objective, empirical information that bears on certain vital questions: How serious are the problems that policymakers want to address? What are the consequences of proposed solutions? Are there alternative solutions that merit consideration? What are their consequences? The Institute s work takes several forms: Original research studies on major issues confronting workers compensation systems Original research studies of individual state systems where policymakers have shown an interest in reform and where there is an unmet need for objective information Sourcebooks that bring together information from a variety of sources to provide unique, convenient reference works on specific issues Periodic research briefs that report on significant new research, data, and issues in the field Benchmarking reports that identify key outcomes of state systems