Workers' Compensation Cost Containment and Health Care Provider Income Maintenance Strategies

This article examines the effectiveness of health care cost containment measures. The basic hypothesis tested is that health care providers will attempt to circumvent any measures that may decrease their income. The data come from a single insurer in Michigan and include cases from before and after implementation of fee schedules and utilization review policies. The results suggest that, in response to fee schedules, health care providers tend to provide more complex procedures in a shorter period of time and tend to exploit ambiguities allowed under the fee schedule.