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Friday catch-up

Gotta love the start of summer; hope your weekend is going to be filled with fun and family.

But before you go, here’s what’s been going on over the past couple of weeks.

First, your morning’s the latest from the world of “how do we suck as much profit from employers and taxpayers as possible”…thanks to a colleague at PBM Helios.

Drug costs

A report from AARP indicates generic drug prices, which have been falling for years, leveled off somewhat in 2013.  Couple caveats – the data is for drugs commonly used by seniors, and the data is 18 months old. Among drugs relevant to workers comp:

  • anticonvulsant prices increased 17.2% in 2013;
  • muscle relaxants decreased 0.7%;
  • opioid analgesics dropped 8.3%; and
  • NSAIDs were down 8.4%.

Two other data points worthy of consideration.

  • CompPharma is currently conducting the 12th annual survey of prescription drug management in workers’ comp; the top issue named by respondents so far is drug price increases (a major change from the historical focus on opioids)
  • All the major PBM drug trend surveys released to date have identified drug price increases as a major issue.

Health reform implementation

The latest data indicates the percentage of Americans 18 – 64 without health insurance decreased to 16.7% in 2014, down from 20.4% in 2013.

According to California Healthline;

The uninsured rate for U.S. adults under age 65 in [Medicaid] expansion states during the study period was 11.5%, a 3.4 percentage-point drop from 2013. By contrast, the uninsured rate for U.S. adults under age 65 in non-expansion states was 16.3% during the first nine months of last year, a 2.1 percentage-point decrease.

There’s a LOT of useless and some outright harmful medical care delivered every day – as has been well documented by many.  A highly readable and compelling analysis comes from Dr Atul Gawande in a recent New Yorker; thanks to multiple readers and friends for the heads up.

Macro factors

Bad news came this morning; the economy actually shrank by 0.7% in Q1 2015; however that comes on the heels of a 5% jump in the latter half of 2014.  Projections for the rest of the year look modest but positive; it also looks like unemployment may drop to 5% by the end of 2015; a major improvement over the 8% we saw two years ago.


Thanks to NCCI for updating our understanding of claim lag, the last broad-based analysis was the Glen Pitruzzello-authored study by the Hartford.


Summit’s acquisition of Paradigm is said to be close to completion.  While we don’t know pricing or details, expect the transaction will be in the $500 million range as Paradigm’s EBITDA is rumored to be around $60 million.

Finally, word from multiple sources indicate imaging network company MedFocus has been bought by OneCall Care Management.  MedFocus isn’t a major player with work comp revenues in the $25 million range, but the transaction does further limit the number of vendors available to serve comp payers.


One thought on “Friday catch-up”

  1. Great roundup this week! Here’s hoping this bit of stagnation we’re seeing is very temporary – we need some good news next time. Thanks for sharing!

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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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