The Workers Compensation Research Institute released “Trends in Non-Price-Controlled Medical Services” on July 30, 2026, a FlashReport covering 43 jurisdictions with data from January 2019 through June 2025. The headline finding: half of all durable medical equipment (DME) billing codes in workers’ compensation carried no assigned fee schedule rate in 2025, yet those uncovered codes accounted for 62% of all DME payment dollars, up from 58% in 2019. Utilization followed the same direction: the share of DME service line items without a schedule rate climbed from 41% to 48% over the same period.
Trade coverage has framed this as an insurer pricing problem. It is more precisely a case-adequacy problem for self-insured employers.
Who It Affects
Self-insured employers in any jurisdiction, but especially those operating in the ten states where 100% of DME expenditures fall outside fee schedule controls, including Georgia, Idaho, and Arkansas. There, no schedule guardrail exists for any DME claim. Connecticut sits at 92% uncovered. Rhode Island’s uncovered share jumped 29 percentage points between 2019 and 2025; Alaska, California, Delaware, and Washington each saw increases exceeding 10 points. Even states with meaningful schedule coverage show a widening gap: Arizona sits at 36% uncovered and Massachusetts, New York, and Ohio range from 17% to 27%.
Workers’ comp claims with significant DME components (catastrophic injury, orthopedic recovery, occupational disease) carry the most exposure. Hospital-based self-insured systems and public-entity self-insurers with first-responder WC programs frequently hold these claim types in open inventory for years.
The Reserve Mechanism
The lever is medical case adequacy. Most self-insured WC programs set initial DME reserves using a benchmark that implicitly assumes a fee schedule rate applies. When the adjuster or actuary uses a schedule rate as the cost floor, and the actual DME is billed under a catch-all code with no schedule entry, the case reserve understates actual cost exposure from day one.
Three codes drive more than half of uncovered DME payments. E1399 (miscellaneous DME) averaged $300 per day in rental costs and grew from 18% to 26% of uncovered DME expenditures between 2019 and 2025. E0676 (intermittent limb compression) averaged $1,862 per day for new devices. E0221 (infrared heating pad) averaged $2,620 per day for new devices. E1399 alone accounts for more than a quarter of all uncovered DME dollars; it is the catch-all code that absorbs whatever does not fit an existing scheduled entry.
Professional services carry a smaller but growing version of the same gap. Pain management injections were 11.7% uncovered by payment and neurological and neuromuscular testing was 29.4%. In California, Louisiana, Massachusetts, Michigan, Oregon, and D.C., five to 38% of professional service payments went to uncovered codes.
The reserve consequence compounds over time. Actuarial projections that benchmark to historical paid data calibrated against fee schedules will understate trend when the uncovered share is growing. WCRI’s six-year dataset shows the uncovered DME payment share rising steadily, widening the gap between assumed and actual cost basis. That pattern parallels what WCRI’s hospital outpatient surgery payment index showed for facility fees: charge-based and no-fee-schedule states grew at roughly twice the rate of fixed-amount states from 2011 to 2024.
For a self-insured program with a high concentration of catastrophic or orthopedic WC claims, case reserve strengthening in the DME line may be structurally necessary, not episodic, in states where the uncovered share exceeds 60%.
What This Means for Your Next Review
Ask your TPA or claims system administrator to stratify open WC medical reserves by billing code, separating claims where DME has been reserved at a schedule rate from claims where the active code (E1399 and similar catch-all codes) has no schedule entry. For multi-state programs, sort by state: the ten jurisdictions with 100% uncovered DME exposure require a different case-reserve benchmark than states with comprehensive schedules. Flag those claims for independent review before the next reserve study closes. If your actuary is calibrating DME trend from historical paid data without adjusting for the growing uncovered share, your medical severity projection is underweighted at the high end.