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September 29, 2021

Workers’ Comp Pays More Than Group Health to Treat Similar Injuries: NCCI Study


Workers’ compensation pays more than group health to treat comparable injuries, according to a research brief issued by the National Council on Compensation Insurance.

Although the workers’ compensation benefit delivery system is specifically geared to the needs of employers and injured workers, it operates within a much larger healthcare system, explained the NCCI in the brief.

While group health (GH) makes up a far bigger portion of that system than does workers’ compensation (WC), the two coverages have many commonalities in the medical services they cover, which is why "it makes sense to tap into group health data to compare prices and utilization between the two,” said the brief, which was authored by Dan Corro, Tom Daley, and Barry Lipton.

Key Findings of the Report

For 12 common workers’ compensation injuries, the cost of physician services within the WC and GH insurance systems indicates that:

  • WC pays more than GH to treat comparable injuries
  • The most pronounced difference between WC and GH is the greater quantity of physical medicine services in WC
  • Utilization differences are much bigger than price differences for WC relative to GH, explaining most of the cost difference
  • Utilization differences vary principally by type of injury: all selected injuries show a higher level of utilization for WC than for GH
  • Price differences are more related to the jurisdiction than to the type of injury for WC, due in part to the different state fee schedules that apply
  • Cost differences between states are more correlated with price differences than with utilization differences
  • Traumas to arms and legs consistently have smaller cost and utilization differences in WC, while chronic pain‐related injuries, such as bursitis and back pain, have larger differences
  • A more expensive mix of procedures in complex WC cases contributes to higher costs relative to GH, especially for referral-based care, like radiology and surgery.


The WC experience for this study is from NCCI’s Medical Data Call (MDC). The MDC captures transaction-level detail on medical bills processed on or after July 1, 2010. That detail includes dates of services, charges, payments, procedure codes, and diagnosis codes. NCCI collects the data and administers the Call for 35 jurisdictions where NCCI provides ratemaking services and for several additional states.

The GH data for this study consists of medical experience from employer‐sponsored health benefit plans. NCCI licensed it from Truven Health Analytics, an IBM Watson Health Co., which provides healthcare data and analytics.

Both the WC and the GH data are for service years 2013 through 2016. To be comparable with WC, GH payments reflect the full cost of any service, including any co-payment, deductible, or coinsurance. Critical to the study, both WC and GH use CPT codes to identify physician procedures and ICD diagnosis codes. (Editor’s note: In the report’s footnotes, CPT codes are defined as "Current Procedural Terminology,” which is a standard coding scheme in medical billing to identify specific procedures. ICD refers to "International Classification of Diseases,” which is also a standard coding scheme in medical billing.)

The full report is titled: "Workers Compensation and Group Health—Comparing Utilization of Physician Services.”

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