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The studies were carried out by means of comparisons between the market price of the medical service (for which the studies use prices paid by group health (GH) plans) and the prices paid by WC plans, in response to changes in the MAR. Foremost among the studies' conclusions is that the extent to which a change in the MAR affects payments by WC plans to physicians is a function of several variables, and it is by no means the case that these payments move in tandem with the MAR or that they are universally limited to the MAR. Moreover, these same general truths apply to GH payments.

The manner and the extent by which WC payments change in response to a change in the MAR for a given service depend on the relationship between the MAR and the GH payments. For example, if the MAR is significantly higher than the GH payments, the average WC payment may be less than the MAR. On the other hand, if the MAR is close to or below the GH payments, the average WC payment is more likely to be close to the MAR.

An MAR is more effective at controlling the cost of high-volume low-priced services (physician office visits, physical therapy) than low-volume high-priced services (burn treatment, emergency room visits).

The single study of a decrease in MAR between 2002 and 2006, i.e., the MAR for shoulder X-rays in Oregon, provides what the authors call "a near 'textbook' picture of how a WC medical fee schedule change should function." In 2002, the Oregon average WC payment for a shoulder X-ray was slightly higher than the average GH payment. The subsequent downward adjustment of the MAR lowered the WC payment to just under the GH payment in 2006. The authors point out that the impact of increasing a WC fee schedule MAR is not simply the reverse of decreasing it. For example, service providers may very well be motivated to increase their prices when the MAR is raised but lack a similar motive when the MAR is lowered.

Amounts payable for particular services are less likely to be containable at the MAR when the services involve multiple providers or a hospital or other facility. For example, in Florida, in both 2002 and 2006, facilities billed for many of the carpel tunnel procedures performed in them. As a result, around one-half of such procedures were reimbursed in amounts above the MAR for physicians. Subsequently, Florida promulgated fee schedules for hospitals and ambulatory surgical centers.

The authors present the results of the studies via graphs of GH and WC payments as they respond to changes in MARs. They discuss the varying results in each state and with each medical service, their goal being to assist workers' compensation systems in building and maintaining medical fee schedules in the face of more complex billing schemes, such as Medicare's Ambulatory Payment Classifications (APCs) and Diagnosis Related Groups (DRGs), which, along with recently developed treatment protocols, seek to address utilization of services as well as costs.

> Read the study: Dan Corro and John Robertson, "The Impact on Physician Reimbursement of Changes to Workers Compensation Medical Fee Schedules," NCCI Holdings, Inc. (April 2011).