A new study has revealed that many workers’ compensation schemes in Australia are paying inflated but differing prices for the same medical services provided to injured workers, with NSW facing particularly high costs.

The icare study, which compared the cost of medical imaging services in NSW and in other Australian workers’ compensation jurisdictions, showed that the $18.8 million the social insurer spent for the services in 2016-17 would have cost only $9.7 million if purchased by WorkSafe Victoria; $11.3 million if purchased by WorkCover WA; and $11.4 million if purchased by ReturnToWork SA.

WA, SA, and Victoria were included in the study due to the availability of their public fee schedules, used by icare to calculate the volume of medical imaging services it purchased from 2016-17.

“When it comes to purchasing medical imaging, New South Wales is one of the most expensive workers’ compensation jurisdictions in Australia,” said John Nagle, icare workers insurance group executive.

The study also found that all schemes included in the study “paid a much higher cost for medical imaging services than Australian consumers outside of state-run workers’ compensation schemes.”

“In effect, our $18.8 million cost for medical imaging would have been only $6.3 million if the services were charged at 100% of Australia’s MBS (Medical Benefits Schedule) fee schedule,” Nagle said. “The data suggests that workers’ compensation schemes in many Australian jurisdictions are paying inflated prices for medical imaging – with NSW facing particularly high prices. The regulated set maximum fees are exactly that - a maximum. This study shows that much lower prices for the same services can and are being attained.”

Nagle said icare is in talks with the industry to achieve “a more equitable and sustainable pricing schedule.”


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