A leading return to work physician says a trend towards more diagnostic tests and treatment is contributing to the rising cost of workers compensation.

The most recent Federal Government estimate (from Safe Work Australia) is that the direct and indirect cost of work-related injury and illness to the Australian economy was $57.5 billion in 2005-06 – equivalent to 5.9 per cent of gross domestic product.

Dr Mary Wyatt, a specialist occupational physician and the editor of Return to Work Matters (RTW Matters), says the average cost of claims has risen significantly in the last four years.

Figures from a survey of about 2,000 workers compensation claimants from Australia and New Zealand conducted for RTW Matters shows that the average claim cost increased by almost $3,000 over the past four years – from $10,353 in 2005-06 to $13,336 in 2008-09.

Dr Wyatt says those costs affect the individual, businesses and the taxpayer.

“Some years ago there was work done, and it said that the cost is borne equally: one-third by the employee who has the injury, one-third by the employer, and one-third by the community,” she told ABC News Online.

While increased wage rises and inflation account for some of the costs, Dr Wyatt says a significant proportion is being caused by over-treatment.

“We have an increasing focus on the medicine, and we have lots of scans that tell us there are things wrong with our bodies, and then when those scans are done it’s often labelled as a serious problem, and then the worker gets worried and we often go off on a tangent,” she said.

“The rate of increase in scans and the rate of increase in surgery’s gone up dramatically, particularly for some conditions, and that’s also contributing to increased costs as well.”

She says it is often not the fault of the medical professionals, with both patients and the various workers compensation systems often demanding hard evidence of exactly what is wrong.

“If somebody goes to their doctor they’ll often expect a scan, and of course you’ll be well aware of the publicity recently about the problems of CAT scans and the radiation, but we see people who’ve got four or five bags of scans,” Dr Wyatt said.

“In our system we’re making it increasingly complex. So the person has to go to the doctor, which is not inappropriate, but then the doctor has to design the restrictions, and the restrictions get put on a certificate and that certificate gets given to the supervisor who scratches their head because often the restrictions don’t make sense.”

Yet the increase in treatment and costs has not led to improved outcomes, with only 72 per cent of survey respondents back at work six months after their injury – down from 80 per cent when the last survey was done four years ago.

The survey also shows the average number of days off work per case has increased 8 per cent – from 51 to 55 days.

Dr Wyatt says the longer it takes people to return to work, the lower the chances of a successful return to employment.

She adds that creating uniform national rules for workers compensation will not improve outcomes unless there is a greater focus on increasing cooperation between employers, employees and their medical practitioners.

“People, when they’re out of work for a few years, stay off work forever, and harmonising the rules isn’t going to change the outcomes of those people we see day-in day-out.”

She says she has seen cases where employees have felt too afraid to raise work-related injuries with their employers until the problem escalates and requires major treatment.

In particular, many repetitive strain type injuries could be addressed by ergonomic improvements or altering an employee’s duties when mild pain first arises, rather than treating them later on through an expensive chain of scans and rehabilitation.

“But now we’ve got a woman who’s back at work two hours a day after being off work for six weeks, highly medical focus and that claim is going to cost that company a hundred thousand dollars instead of a couple of thousand for what could have been dealt with more effectively.”

If you are a worker, employer, or involved in the workers compensation industry and would like to share your experiences of the system, email abcbiztips@gmail.com