A new study traces Delaware’s growing workers’ compensation insurance prices to Delaware’s high fee schedule and final paid medical costs to health care providers.
The Workers Compensation Research institute presented the report to Lt. Governor Matt Denn and his state task force Friday ahead of public hearings surrounding the latest proposed double-digit workers comp rate increase.
Delaware’s specialty care costs easily out-pace the other 26 states ranked in final prices, with surgery costs nearly double the median rate.
Senator Gerald Hocker (R-Ocean View) sits on the task force and notes that trend grew exponentially when comparing Medicaid payouts to Delaware’s overall fee schedule.
“When they carried it to the Medicare payment schedule, they were quite a bit higher and we need to take a strong look at that, but it makes me think that the surgeons in this state are doing very well,” said Hocker.
But the report explains that simply lowering the fee schedule may not net the state any savings.
Illinois reduced its fee structure in 2011. Average prices fell, but workers compensation surgery costs rose, winding up about 230 percent higher than for group health insurance members.
Hocker and others on the task force say they were shocked when the Delaware Compensation Rating Bureau proposed a more than 41 percent rate increase in October, even after lawmakers approved several recommendations designed to curtail those costs.
Hocker says he’s interested to see the impact this report will have during next month’s meetings on the proposed increase.
“I’m very curious to see what the [Delaware Compensation Rating Bureau] comes up with now after proposing the [41.75 percent increase]. We’re hoping to see a big decrease in that," said Hocker. "Something has to be done. [In this report] we’re rated with other states and we’re one of the worst.”
The Department of Insurance will take public comment on the rate increase proposals as part of its meetings February 10th and 11th in Wilmington.