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Solving work comp physician dispensing, one bill at a time

It’s been a week of focus on pharmacy, so forgive one last post on the subject.

Now that Illinois has joined CT MS AR SC GA and a host of other states that have addressed the outrageous practice of charging unconscionable prices for physician-dispensed repackaged drugs, what’s to be done in other states that have yet to stop the practice?

I’m talking Florida, Maryland, North Carolina, Hawaii, where some politicians have blocked fixes, or the regulatory process has yet to gain traction.

It is quite likely that dispensing companies are experiencing a significant cash flow crunch. They didn’t expect Illinois to end upcharging for repackaged drugs, and their projections of millions in revenue from the Land of Lincoln are now shattered.

An increasing number of payers are applying retail pharmacy rates to bills for physician-dispensed scripts in Florida – slashing reimbursement to a fraction of dispenser’s billed charges.

This latter approach is also being employed in Maryland and a couple other states where payers are increasingly fed up with politicians’ votes allowing dispensing of repackaged drugs.  The pols’ favoring of huge out of state contributors over taxpayers and employers has yet to cost them politically, but in the interim some payers are refusing to pay the tab, and are disputing dispensers’ bills thru adminstrative processes.

Sure, payers may well lose some disputes in some states, or perhaps many in many states, but the pressure they are bringing to bear is hurting dispensers and their enablers and owners.

The mood inside dispensing companies’ office must be very angry, extremely frustrated, and even shocked that employers and payers are finally refusing to pay their bills. If you listen carefully, you can almost hear their shrill whining…”Who do they think they are? How dare they not pay us what we want when we want?! Don’t they know they have to?!”

To which I would answer:

We are the fiduciaries responsible to our policyholders; We pay what we are legally obligated to pay; We’ll rely on the legal system to tell us what to pay, not some profiteering plunderer’s made-up bill.

Feel free to quote me.

3 thoughts on “Solving work comp physician dispensing, one bill at a time”

  1. Hear, Hear! Thanks, Joe. It’s a successful strategy overall for those with the guts to do it.

  2. Go Joe! Preach on!!! But it’s not only the price that concerns me. My question is this, is the injured worker getting the best medication to get back to work or just what the physician has in stock? There’s more, as Joe knows, to physician dispensing issues than just price.

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Joe Paduda is the principal of Health Strategy Associates



A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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