A recent operations report, made available to the Texas Workers' Compensation Commission by the Kemper Medical Audit Services (MAS) Operations Division, summarized the cost impact of various provider groups on Workers' Compensation in Texas. The report was based on billing data compiled from January 1991 through August 1991 on the following provider groups: hospital out-patient services; hospital in-patient services; pharmacy; physical therapy; chiropractic; and medical physicians.
The report delineated costs by the number of provider bills submitted; total charges per provider group; and by the average charges per bill. In the first eight months of 1991, the total charges for all provider groups were $71,569,070.02. These charges break down by provider group as follows:
Provider Group Cost Impact ($) % Impact Hospital Out-patient 10,754,546 15.03% Hospital in-patient 14,840,594 20.74% Pharmacy 2,582,726 3.61% Physical therapy 5,226,924 7.30% Chiropractic 3,679,562 5.14% Medical physicians 34,484,717 48.18%
In examining the average charges per bill data, the following is noted:
Provider Group Avg. Charge Per Bill Avg. Procedures Per Bill
Hospital out-patient $678.69 Hospital in-patient $5,688.23 Pharmacy $64.93 2.01 Physical therapy $303.40 12.48 Chiropractic $253.71 10.54 Medical physicians $281.59 4.28
Further analysis of the data provided by Kemper revealed that there were major differences in the average costs per procedures by the various provider groups. Chiropractic physicians had the lowest cost per procedure among the providers. The average cost per procedure for the pharmacy providers was $32.30; $24.31 for the physical therapists; $24.07 for chiropractic; and $65.79 for medical physicians.
It should be noted that the only cost center representing a total bill for services to the patient was the chiropractic bill, as most chiropractic physicians bill for a variety of diagnostic and therapeutic measures under the same "umbrella." The similarity between the chiropractic costs per procedure ($24.07) and the physical therapist cost per procedure ($24.31) are not equivalents when one considers that physical therapists can only treat under the auspices of a physician's referral. Therefore, the charges for the office call, the diagnostic radiology, and pharmacy are not included under the billing data for physical therapy.
A comparative analysis of chiropractic charges per bill versus physical therapy charges per bill demonstrates that chiropractic bills are, on the average, 16.4% less than physical therapy bills. The same analysis of chiropractic charges per bill versus medical charges per bill demonstrates the chiropractic bills to be, on the average, 10 percent less than comparative medical bills.
The Kemper data provides us with concrete data indicating relative utilization of services and comparative costs for services by provider group. By this data, chiropractic has demonstrated cost effectiveness in the Workers' Compensation arena.
Brad McKechnie, D.C., D.A.C.A.N.
Pasadena, Texas
