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Medicare changes unlikely to drive comp medical costs, ratings agency reports - Business Insurance Skip to content Register for free Search Search Log In Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Medicare changes unlikely to drive comp medical costs, ratings agency reports by Louise Esola Workers Comp Coverage Aug 17, 2026 Changes to Medicare reimbursement rates are not expected to place significant upward pressure on overall workers compensation medical costs, the National Council on Compensation Insurance said in a report released Thursday. The effects will vary by state based on how closely its workers comp medical fee schedules follow rates and reimbursement rules established by the Centers for Medicare and Medicaid Services, Boca Raton, Florida-based NCCI said. Physician services and facility care each account for about 40% of countrywide workers comp medical expenditures, making the Medicare updates affecting those services particularly relevant to comp insurers and employers. The Medicare physician conversion factor increased 3.3% for 2026, its first increase after five consecutive years of declines. The increase was driven largely by a one-year 2.5% statutory payment adjustment. CMS also increased reimbursement for evaluation and management services and reduced rates for surgical services. Because surgical services represent a larger share of workers comp medical care than they do in Medicare, NCCI estimated that the relative-value changes would reduce average workers comp payments by 1.2%, compared with the 0.49% reduction determined by CMS. States that incorporate both the Medicare conversion factor and relative values into their workers comp fee schedules could nevertheless experience a small increase in physician costs because the higher conversion factor may offset the reduction in relative values. States that use their own conversion factors will incorporate the 1.2% reduction in relative values, while the overall change in physician reimbursements will depend on updates to their state-specific factors, NCCI said. Medicare national base rates increased 2.6% for hospital outpatient and ambulatory surgery center services and 2% for hospital inpatient care. CMS also lowered the threshold used to identify unusually costly inpatient cases by 13%, to $40,397 from $46,217. The change could increase workers comp costs by allowing more cases to qualify for additional reimbursement in the 10 jurisdictions that incorporate the threshold into their inpatient fee schedules. Those jurisdictions are Alaska, Colorado, Connecticut, the District of Columbia, Indiana, Mississippi, North Carolina, South Carolina, Texas and West Virginia. The Medicare update factor for durable medical equipment, prosthetics, orthotics and supplies increased 2%, in line with the prior year’s change, NCCI said. 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