Calif. Workers’ Comp Medical Costs Soar to a Record High

California workers’ compensation medical costs soared to a record $3.6 billion last year, an increase of more than $1.5 billion since 1994, according to the California Workers’ Compensation Institute’s (CWCI) latest accident year ultimate incurred cost estimates.

Medical care costs for injured workers fell 36 percent from 1991 to 1994 as the Golden State’s economy was hit with the worst economic downward spiral since the Great Depression. But the middle of the 90s, both physician costs, as well as hospital, med-legal, pharmacy and other medical expenses, bottomed out and began a rapid upward spiral.

The bureau’s latest estimate of ultimate incurred medical costs show aggregate costs have now increased more than 70 percent from 1994, even though insured claim frequency has fallen 24 percent over the same period. Physician costs have impacted the increase in medical expenses, rising to just under $2.2 billion last year—up 85 percent since 1994—while all other medical costs not subject to the Official Medical Fee Schedule now total nearly $1.5 billion (a 5-year increase of 53 percent). According to the CWCI, some of the recent increase is part of a national trend toward higher health care costs. For more information, visit www.cwci.org.

Topics California Workers' Compensation