A new study by the Workers Compensation Research Institute (WCRI) illustrates how rising inflation has impacted the system in recent years.

The 2025 edition of the WCRI Medical Price Index for Workers’ Compensation, authored Dr. Rebecca Yang and Dr. Olesya Fomenko, analyzed the cost for medical services including evaluation and management, physical medicine, surgery, radiology, neurological testing, pain management injections and emergency care—typically billed by physicians, physical therapists and chiropractors.

The annual study examines how fee schedules and network participation influence price trends, providing insights into price regulation.

There were distinct price variations among states.

Costs for medical services varied significantly, ranging from 33 percent below the 36-state median in Florida to 172 percent above the median in Wisconsin in 2024. This reflects Florida’s fee schedule and Wisconsin’s lack of one.

Six states with no fee schedules (Indiana, Iowa, Missouri, New Hampshire, New Jersey and Wisconsin) had prices 35 to 177 percent higher than states with fee schedules in 2024.

Most states without fee schedules saw faster price increases from 2008 to 2024, with a median growth rate of 40 percent, compared with 15 percent in states with fee schedules.

The study provides insights on price changes following major fee schedule updates, examining overall price shifts and changes by service type.

For example, California uses a Resource-Based Relative Value Scale fee schedule tied to Medicare and regularly updated, controlling costs. Colorado and Arizona also implemented this type of fee schedule.

Other trends tied to fee schedules included Illinois, which showed cost increases slowed after implementation of a fee schedule, and Massachusetts, which had an outdated fee schedule leading to higher price increases.

Medical provider network participation also slowed price increases. Insurers in Texas direct injured workers to preferred provider networks. This led to a 10-20 percent reduction in costs compared to non-network providers.

This latest edition expands the growth rate analysis over 17 years, from 2008 to 2024, and presents price index comparisons for 2023 and 2024 across the 36 study states.

“This study found that many states experienced faster growth in prices paid for workers compensation medical professional services from 2021 to 2024 compared with earlier years,” said Ramona Tanabe, WCRI’s president and CEO. “This trend is due to, among other things, higher inflation in the general economy over the last few years. This was especially the case for states that update their fee schedules based on all-price indexes, rather than on medical price indexes.”

The 2024 results are based on price data collected from the first half of the year, up until June 30, 2024. The WCRI notes the 36 states included represent 88 percent of workers’ compensation benefits paid in the United States.

Download a free copy of the report:
https://www.wcrinet.org/reports/wcri-medical-price-index-for-workers-compensation-17th-edition-mpi-wc.