Comp medical costs are back on the rise

We usually find out about things first when there’s a report out of California; growing facility costs, surgical implants, physician repackaging, compound meds, narcotic usage are among the cost drivers that received wide-spread attention after publicity in California.
Yesterday’s news that medical costs have resumed their seemingly-inexorable rapid climb may be the most troubling revelation yet from the Golden State.
Here’s what CWCI had to say about their review of recent medical cost trends:

The results confirm the findings of the earlier studies, again showing a sharp reduction in medical payments immediately after the reforms were enacted in 2004, followed by a distinct trend of increasing medical payments associated with work injuries beginning in AY 2006 and continuing through the end of the study period. This trend has pushed average medical expenditures per claim significantly above pre-reform levels, with all four of the medical expense categories continuing to rise. [emphasis added

According to CWCI, the growth in medical costs was far outweighed by the increase in medical management/cost containment expenses. That’s concerning, but without these cost containment investments, medical costs would have been much higher.
CWCI again – “Although the utilization review and the Medical Provider Network access fees represent significant, ongoing medical cost containment expenditures for workers’ compensation claims administrators, prior CWCI studies have shown that they are associated with an estimated $12.8 billion to $25.3 billion in medical cost saving between 2004 and 2008. [emphasis added] I would note the terminology is somewhat indirect, cost containment programs are “associated with” the savings. It is impossible to say what would have happened if those programs had not been in place, thus we can only make (well-)educated assumptions.
Which leads to this rather troubling conclusion – despite major reforms, huge investments in what look to be much-more-effective cost containment programs, and ongoing attempts to close regulatory loopholes, medical costs are once again zooming up.
And if its happening in California, a state with pretty strong managed care, it may well be much worse in other jurisdictions.
What does this mean for you?
Do you know where your medical costs are heading?