The Workers’ Compensation Research Institute (WCRI) held a webinar on September 3rd to review key findings from their recent report Trends in Non-Price-Controlled Medical Services, providing further insight into payment and utilization patterns for medical services that do not have established fee schedule reimbursement rates and how those trends vary across states.

The study findings reinforce that medical cost inflation is being driven not only by fee schedule increases but also by a growing share of services and equipment that fall outside established reimbursement schedules.

According to the webinar, when medical services and durable medical equipment (DME) do not have an established workers' comp fee schedule rate, they are often reimbursed using a percentage of billed charges or other alternative methodologies. Because of this, many workers' comp fee schedules rely on Medicare reimbursement methodologies, but this can result in fee schedule gaps, which occur because:

• Medicare does not reimburse certain devices or services
• Medicare considers some items bundled and does not pay separately for them
• Some devices are viewed as preventive or not medically necessary under Medicare rules
• Certain workers' compensation-specific services have no Medicare equivalent
• Some state fee schedules have not been updated to include newer devices and procedure codes

The study found that approximately half of unique DME devices lacked an assigned fee schedule rate across workers' comp jurisdictions with fee schedules. Devices without fee schedule rates accounted for approximately 63% of DME payments, and the percentage of DME payments going to non-fee-scheduled items increased from 58% in 2019 to 63% in 2025.

In several states, virtually all unique DME devices were outside established fee schedules. Devices lacking fee schedule rates tended to be more expensive than devices with established reimbursement rates.

Additionally, miscellaneous codes make up a significant portion of spending. The code E199 (Durable Medical Equipment, Miscellaneous) accounted for 44% of payments for DME without fee schedule rates and 36% of utilization among non-fee-scheduled DME devices. This code is often used as a catch-all code when no specific code exists, making reimbursement les predicable and difficult to manage.

The study also found that there were substantial differences among states. For instance, Arizona, Florida, Massachusetts, and New York experienced large reductions in DME paid outside fee schedules between 2019 and 2025. In Arizona and Florida, decreases were largely tied to adoption of newer Medicare fee schedule updates, while Massachusetts added fee schedule rates for commonly billed DME codes, and New York's prior authorization requirements appeared to reduce billing for certain non-fee-scheduled devices.

The WCRI concluded that growth in payments for services and devices lacking fee schedule rates is likely contributing to recent increases in workers' comp medical costs. Their rationale includes the following points:

• These services are often reimbursed based on billed charges rather than predetermined rates.
• They tend to be more expensive than services covered by fee schedules
• The share of spending on these services has generally increased over time

From a payer perspective, the webinar suggests several areas worth monitoring:

• Growth in miscellaneous DME billing, especially E1399
• Services reimbursed outside state fee schedule
• State fee schedule updates and Medicare adoption cycles
• Prior authorization programs for high-cost DME
• Utilization trends that shift spending toward non-price-controlled services