Objectives This study aimed to determine whether a multi-faceted model of management of work related musculoskeletal disorders reduced compensation claim costs and days of compensation for injured workers. Methods An intervention including early reporting, employee centred case management and removal of barriers to return to work was instituted in 16 selected companies with a combined remuneration over 337 million. Outcomes were evaluated by an administrative dataset from the Victorian WorkCover Authority database. A quasi experimental pre-post design was employed with 492 matched companies without the intervention used as a control group and an average of 21 months of post-intervention follow-up. Primary outcomes were average number of days of compensation and average cost of claims. Secondary outcomes were total medical costs and weekly benefits paid. Results Information on 3,312 claims was analysed. In companies where the intervention was introduced the average cost of claims was reduced from 6,019 to 3,913 (estimated difference 2,329, 95 CI 1,318- 3,340) and the number of days of compensation decreased from 33.5 to 14.1 (HR 0.77, 95 CI 0.67-0.88). Medical costs and weekly benefits costs were also lower after the intervention (p\0.05). Reduction in claims costs were noted across industry types, injury location and most employer sizes. Conclusions The model of claims management investigated was effective in reducing the number of days of compensation, total claim costs, total medical costs and the amount paid in weekly benefits. Further research should investigate whether the intervention improves non-financial outcomes in the return to work process.