April 15, 2025 | MedLegalNews.com – CWCI: CA Workers’ Comp: The California Workers’ Compensation Institute (CWCI) has released a new study showing a sharp increase in medical-legal (med-legal) costs following the implementation of the updated Medical-Legal Fee Schedule (MLFS) in April 2021. Although the schedule aimed to improve Qualified Medical Evaluator (QME) retention and streamline compensation, its impact on costs has far exceeded expectations.
Fee Schedule Reform: A Costly Shift
According to the study, the average payment for a comprehensive med-legal exam rose 52%, driven primarily by new per-page record review fees added on top of flat evaluation fees. Notably, 2023 also saw a 6% increase in the number of certified QMEs compared to pre-pandemic levels.
The 2021 MLFS replaced the prior time- and complexity-based model (in place since 2006) with flat fees and page-based surcharges for records exceeding a certain threshold. At the time, the Division of Workers’ Compensation (DWC) estimated the changes would raise overall compensation by 25%—yet the actual increases have more than doubled that projection for some services. CWCI: CA Workers’ Comp
Key Findings from the CWCI Study
CWCI’s report draws on payment data from January 2015 to October 2023, using valuation data as of December 2023, to compare reimbursement trends before and after the MLFS overhaul.
Among the most significant findings:
- Comprehensive evaluations now average $3,832, including $1,817 in added per-page record review charges on top of a $2,015 flat fee.
- Follow-up evaluations and supplemental reports also saw steep cost increases, with page review charges averaging $1,338 and $1,335, respectively.
- Page-review surcharges were present in 43.3% of comprehensive exams, 24.9% of follow-ups, and 30.8% of supplemental reports.
- Since 2019, the number of certified QMEs grew 5.9% (from 2,561 to 2,712). However, panel assignments rose by 2.9%, resulting in only a 3% net gain in evaluator capacity.
- Orthopedic surgeons performed 44% of all med-legal evaluations in 2023, while chiropractors accounted for 11%.
Industry Implications and Looking Forward
This surge in med-legal costs has raised concerns among stakeholders. While higher reimbursements may help attract and retain QMEs—one of the goals of the MLFS—the overall cost to the system may challenge the affordability and efficiency of workers’ comp in California.
As claims administrators and employers brace for continued cost escalation, regulators may need to revisit the fee schedule to strike a more balanced approach.
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📎 Source: CWCI Research Report