Drug formularies and workers’ comp

There’s a LOT of activity around the country related to drug formularies.  Four states (OH OK TX and WA) have implemented formularies and at least 4 more are considering doing so (CA, ME, MT, TN). (AR was scheduled to do so this year but pulled back)

The “Why?” is obvious; the proliferation of opioids, inappropriate prescribing of other drugs (Soma(r)), exploding volume of compounding, and rampant off-label use of drugs is seen as a major problem in work comp.

The “What”, as in, what formulary to use, is demonstrably not obvious.

There are (roughly speaking) three varieties of formularies;

  • Open – pretty much any drug is available to anyone
  • Closed – a binary, or yes/no formulary that is drug-centric
  • Disease state/Condition-specific – formulary based on the underlying diagnosis and disease state (e.g. acute v chronic)

The closed formulary has some advantages – it is very simple and easy to understand, and from a regulatory perspective, administer and evaluate.

The closed formulary also has some rather significant issues.

  1. it starts with the drug, not the patient’s medical condition.  This strikes me as backwards; guidelines should ALWAYS begin with the diagnosis.
  2. problems arise when “Y” drugs are dispensed, paid by the PBM, then the payer determines the drug is for an unrelated condition. Think antihypertensives, insulin replacements or asthma meds.
  3. it does not differentiate between acute and chronic stages of a disease or condition; treatment can be quite different for these different stages.

What does this mean for you?

While the closed formulary is easy to explain, it’s a lot tougher to manage on the back end for payers, PBMs, and prescribers alike.

And, while I’m no clinician, allowing antihypertensives and duragesic patches without a prior auth no matter the diagnosis, while requiring a PA for benadryl does seem problematic. 

2 thoughts on “Drug formularies and workers’ comp

  1. Joe, Excellent points. In the Ohio BWC Formulary we have a subset of PA requirements on 363 of the 405 drug classes in the formulary. These drugs have an electronic edit applied at the pharmacy the requires the drug’s most common indications to be related to the allowances in the claim. If the relationship is not there, then a PA is required. Thus an antihypertensive would be blocked in a back sprain. Likewise a sustained release opioid product like duragesic is blocked as a first line product unless there are swallowing or absorption allowances in the claim. Thanks again for keeping the conversation on formulary use going.

    • The “electronic edits” you describe. Are these edits applied by the PBM applying the formulary on behalf of the WC payer based in claim information shared its PBM by the WC payer ?

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