Five years after Indiana adopted a hospital fee schedule but raised some workers' compensation benefits, medical costs dropped slightly and indemnity costs climbed by 15%, a study shows.

The Benchmark Report by the Workers Compensation Research Institute shows that medical payments per claim dropped 12% from 2014 to 2015, then rose 9% the next year. Indemnity benefits per claim increased 4% from 2014 to 2015, and 11% from 2015 to 2016.

After then-Gov. Mike Pence signed House Bill 1320 into law in 2013, the National Council on Compensation Insurance predicted that it would cut total compensation costs in the state by almost 4%, spread over several years. The law set reimbursement rates at 200% of Medicare rates, capped the maximum price for repackaged drugs at the average wholesale price set by the manufacturer, and increased indemnity benefits over three years. 

The medical savings appear to be smaller than predicted, while income benefit costs rose more than predicted. Still, Indiana's indemnity costs are lower than those in many other states.

"Medical payments per claim remained higher in Indiana, and indemnity benefits per claim remained lower in Indiana" when compared with most of the other 17 states that WCRI studied, the report said.

The study is available to WCRI subscribers or can be purchased at the institute's website.