Department of Finance

 

Date of this Version

1994

Document Type

Article

Citation

Journal of Actuarial Practice 2 (1994), pp. 81-99

Comments

Copyright 1994 Absalom Press

Abstract

Medical expenditures in workers' compensation programs have been subjected to few cost containment strategies. As workers' compensation costs have escalated, however, increasing attention is being given to the role of medical fee schedules in containing the prices of medical services. To this end, we develop a model for estimating the potential cost savings from implementing medical fee schedules. A market basket of medical services received by injured workers is constructed. This basket is used to estimate the parameters of the model. In addition, the basket is used to determine the impact of imposing a fee schedule linked to usual and customary charges or to the Medicare resource-based relative value schedule (RBRVS).

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