Health Care Costs and Financing

Hospitalizations for work-related injuries and illnesses declined from 1997-1999, but charges increased

Hospitalizations for job-related injuries and illnesses account for less than 1 percent of all hospital stays. Nevertheless, they represent over 200,000 hospitalizations per year, involve charges of about $3 billion annually, and account for nearly 20 percent of all medical expenditures for worker's compensation (WC) claims in the United States.

According to the first study to compile national data on inpatient hospital care for patients with work-related injuries and illnesses covered under WC, the number of WC hospitalizations fell by about 7 percent from 1997 to 1999, and the proportion of hospitalizations paid by WC declined by over 14 percent during that period. However, there was a sharp 16 percent rise in total charges per WC stay. The study was supported by the Agency for Healthcare Research and Quality (HS11497).

After adjusting for the type of diagnosis and other factors, WC hospital care was found to involve 13-24 percent more procedures, involve 4 percent longer hospital stays, and take 23-54 percent less time from admission to the principal procedure than inpatient care for comparable diagnoses paid by other sources. The most common conditions treated during WC hospitalizations were disc and spinal disorders (27.9 percent of all WC hospitalizations), which had charges 16 percent higher than hospitalizations for the same disorders paid by other sources. Higher WC charges for disc and spinal disorders may reflect several factors, explains the study's principal investigator Allard E. Dembe, Sc.D., of the University of Massachusetts Medical School. The higher charges may reflect greater severity of work-related injuries that require more extensive treatment; greater emphasis in WC medical care on the patient's functional recovery and return to work, and relatively broad coverage for physical therapy and other rehabilitation services provided under WC insurance. Or, the higher WC charges may be due to greater use of fee-for-service billing arrangements typically used in WC medical care. These findings are based on analysis of 3 years of data (1997-1999) from the Nationwide Inpatient Sample, a component of AHRQ's Healthcare Cost and Utilization Project.

More details are in "Inpatient hospital care for work-related injuries and illnesses," by Dr. Dembe, Martha A. Mastroberti, M.S., Sharon Fox, Ph.D., and others, in the American Journal of Industrial Medicine 44, pp. 331-342, 2003.

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