The National Council on Compensation Insurance (NCCI) published a new medical inflation insights report, providing a quarterly overview into what is driving changes in prices and how these changes may or may not impact workers’ compensation.

The NCCI utilizes the Workers Compensation Weighted Medical Price Index (WCWMI), a composition of medical cost components from the Producer Price Index and the Consumer Price Index, reweighted using their Medical Call data to better match the mix of spend in workers’ compensation.

The WCWMI increased 1.2%, after experiencing a series of small accelerations in the pace of price increases in the third quarter. The WCWMI is expected to see annual price growth reach 2-2.5% over the next several quarters.

Drug prices decreased 3.4% year over year in September, while medical equipment and supplies prices decreased 1.3%. Hospital outpatient price growth has begun to normalize after a short period of softer growth. Based on recent trends, this category is expected to continue to move up towards its longer-term average of around 3%.

While “like-for-like” drug (therapeutic equivalent) prices are declining, new drug formulations are becoming more prevalent in workers’ comp. The NCCI noted they have upcoming research on workers’ compensation medicinal drug trends.