AUGUST 28, 2020 – WORKCOMPWIRE
Boca Raton, FL – NCCI released a new Insights brief on the impact of fee schedule updates on Hospital Outpatient Services (HOPs).
As a cost control measure, and to ensure access to hospital services, some states have implemented fee schedules that have established maximum allowable reimbursements (MARs) and rules for HOP services in workers’ comp. Updates to fee schedules result in changes in medical payments. Quantifying the effects of changes to fee schedules in workers’ comp is an integral part of NCCI’s legislative analysis process.
Previous NCCI research indicates a price realization factor of 80% for revisions to MARs for physician services. For example, a 10% change in the MARs for physician services would translate to an approximate 8% change in payments to providers. The study further explores how HOP payments are impacted by changes in the MARs.
Key findings included:
- Changes to medical fee schedules for HOP services affect prices paid for services that are subject to the fee schedule.
- Approximately 75% of the average change in MAR for a HOP service was realized as a change in prices paid.
- Although there is some variation across states, the indicated HOP price realization factor of 75% is an unbiased estimate for any jurisdiction included in this study.
- The price response to fee schedule updates in a given quarter has some dependence on the price change in the prior quarter. However, this dependency is small in magnitude and generally only extends for a single quarter.
This is the first NCCI publication on how hospital outpatient payments are impacted by changes in the maximum allowable reimbursements.
View the report: NCCI: The Impact of Fee Schedule Updates on Hospital Outpatient Payments (PDF)