Sheral Kellar is right about formularies.

Formularies that always allow opioids make no sense. That should be obvious to anyone, and it is to Ms Kellar.

(I’m basing this on an article in today’s WorkCompCentral, which stated:

“A pharmacy formulary is a tool that can be used to address the opioid issue. But it is not the only tool. In fact, Dr. Marcus Dillender, a Ph.D. from W.E. Upjohn Institute for Employment Research, suggests that careful management by insurers and administrators can achieve the same result,”

Sheral Kellar, Esq. is the Director of Louisiana’s Office of Workers’ Compensation Administration; deeply experienced, thoughtful and competent. I met Ms Kellar at CompPharma’s annual meeting last fall when she and several other state regulators spoke about formularies and managing drug usage.

Ms Kellar’s state has the second highest rate of opioid usage among workers comp patients, so she is keenly aware of the issue. She also knows a formulary is NOT a panacea, rather just one tool in the armamentarium.

  • Prescription drug monitoring programs that require and facilitate pharmacist and physician participation,
  • Strong and well-designed utilization review programs,
  • Flexibility for PBMs and payers to customize medication therapy to ensure patients get ready access to appropriate drugs and reduce risks from inappropriate medications,
  • Carefully-planned implementation,
  • Drug testing, opioid agreements, and addiction/dependency treatment

are all key to the solution.

I hesitate to pick on one issue as THE problem – however any formulary that always allows hydrocodone is not what Louisiana’s workers need. According to WCRI

  • A higher proportion of injured workers prescribed pain medications in Louisiana (85 percent) received opioids.
  • Among study states, LA had the second highest rate of patients taking two or more opioids
  • LA had the highest morphine equivalents per claim. – 3540 MEDs, more than double the average.

When you have docs using opioids as first-line pain meds – which clearly is the case in Louisiana, and they prescribe more than twice as much as the average state (which is already too high), and they prescribe more than one opioid most of the time, a formulary that automatically allows docs to prescribe hydrocodone – the most commonly used opioid in LA – is not part of the solution.

What does this mean for you?

Yes, solutions require a multi-pronged approach, but those “prongs” should “first do no harm.”

 

 

Friday catch-up

It’s been a bit busy this week; helping my sister take care of our mom in Maine.  Mom is 96 and ready to move on. She’s had an amazing life; grew up during the Great Depression, master’s degree at 21, ran the FBI’s fingerprint lab during WWII and worked for the CIA overseas in the fifties. Tiny, tough, and very, very smart.

Here’s what’s been happening this week…

Thoughtful post from Richard Krasner on medical cost drivers in workers’ comp. Richard’s dug into the recent NCCI analysis of medical cost categories; his take is inpatient hospital costs are a primary driver.

That makes sense for several reasons.

  • health systems are rapidly consolidating the healthcare provider industry, so more providers bill using facility codes every month.
  • health systems know work comp is a very profitable line; at a time when governmental payers are reducing reimbursement, their financial analysts are digging under every bed to find dollars.
  • health systems are very good at reimbursement – they’ve got more people, more systems, more resources and use them very effectively.

Which makes WCRI’s upcoming webinar on provider choice all the more important.

Following their study on the issue, the fine folk from Cambridge Mass. will walk us through what actually happens when employers or employees control the choice of provider. There’s a good bit of nuance here; it isn’t black and white.

HealthNewsReview has a great piece on a very questionable “research study” published by Proove Biosciences. Proove has been hyper-aggressively pursuing workers’ comp business; I’ll let HNR give you their view of Proove’s press release about a “study”:

[the] release summarizes a study showing that the company’s algorithm, which combines genetic markers with lifestyle and behavior variables, accurately distinguishes between healthy patients with no history of opioid abuse and patients receiving opioid addiction treatment. The study, however, may be comparing people with opioid use disorder with the wrong control group, given that a more useful distinction would be between those who have become addicted and those who have used opioids in similar circumstances without becoming addicted. In addition, the news release fails to provide information about the study’s funding source, nor does it note that four of the study’s six authors work for Proove. [emphasis added]

HNR goes on to state: this tool and others like it have been criticized for both reliability and questionable marketing practices.

Intriguing data on Medicaid patient access and satisfaction, from Axios

While you are spending time with friends and family this weekend, enjoying the extra day off and remembering those who made this possible, you may want to consider how fortunate we are.

Tom Lynch penned a piece in WorkersCompInsider about a Massachusetts worker who broke his leg in a construction accident. The guy fell off a ladder, but his employer didn’t carry work comp insurance. Did the boss get in trouble? No – but he did turn the worker into Immigration and Customs Enforcement, who threw him in jail. The victim in this has a wife and three young kids and, as you can imagine, is terrified.

So are his kids.

Have a great weekend.

AHCA and the circular firing squad

Senate Republicans are not going to pass the AHCA.

Here’s why.

credit NYTimes

23 million Americans would lose their healthcare over the next decade.

14 million of those lose their coverage next year – an election year.

Anyone who’s been elected to the Senate is smart enough to know that taking benefits away from your core supporters is political suicide – and make no mistake, AHCA does precisely that.

Core Republican voters are those most hurt by AHCA; lower-income seniors would see their health insurance premiums explode, jumping almost ten times to $16,100.

But it’s not just about coverage – it’s about employment; healthcare systems, doctors offices, insurers and other businesses would shed 1.8 million jobs by 2022. These are well-paid positions, averaging well over $55,000.

That’s $99 billion in wages alone sucked out of the economy.

Here’s what I see happening.

Senate Republicans know they’re screwed if they pass AHCA as is. So, they may claim they’ve delivered on campaign promises to repeal-and-replace “Obamacare” by passing  some legislation – any legislation – that lets Republicans claim they tried to repeal “Obamacare”.

Then, when the House rejects their bill, the Republican Senate can blame it on House Republicans.

Doesn’t matter if you’re a Trump Republican or a Bernie backer, the cold hard political reality is there’s no way to lower premiums, cut budgets, and improve coverage. Anyone with any experience knew that, and knows that.

What does this mean for you?

The circular firing squad is forming.

 

Compounds in workers’ comp

CompPharma’s second research paper on compounds in workers’ comp was published last week. Authored by pharmacists and government affairs professionals from member PBMs, this paper builds on the ground-breaking research published in our first paper. (I’m president and co-founder of CompPharma)

The first research paper provided a solid foundation to provide stakeholders with a deep understanding of the history, practice, limitations, and issues associated with compounds.

This paper takes a deep dive into patient safety, efficacy, and cost.

It also includes a review of many legal issues surrounding compounds in workers comp and details regulatory and legal cases involving allegedly inappropriate activity by compounders and prescribers.

A few key quotes:

CompPharma supports the use of compounding when prescribed by a licensed practitioner with knowledge of evidence-based medicine supporting the use of a compound for a single patient with special needs that prevent the use of a drug approved by the Food and Drug Administration (FDA). [emphasis added]

the use of topical compounded products is not recommended as first-line treatment for workers’ compensation patients [emphasis added]

CompPharma’s 2014 compound research paper stated, “Pharmacies have received FDA warnings regarding topical lidocaine in concentrations greater than 5% and other topical anesthetics.” Some compounding pharmacists responding to the 2014 paper characterized this statement as a misrepresentation. The authors stand by the statement…

…a chief criticism is that by acting as intermediaries, PBMs profit from the use of compounds and other over-priced medications. In reality, the clinical management programs employed by these companies actually decrease PBMs’ top-line revenue [emphasis added]

The first paper upset a few compounding advocates. Their complaints mostly arose because we didn’t address compounding outside of work comp. Frankly, the paper’s focus was, and the latest paper’s focus still is, purposely limited to workers’ comp. Others are welcome to address non-work comp issues, that’s not what we do.

You can download the paper here – there’s no charge and no registration required.

CompPharma is proud to have been the leading force educating the work comp world about compound drugs; thanks to member PBMs for supporting our work, and a special thank you to

  • Phil Walls, RPh, myMatrixx
  • Deborah Conlon, RPh,  BS Pharm, PharmD, OptumRx
  • Brigette Nelson, MS, PharmD, BCNP, Express Scripts
  • Kevin Tribout, OptumRx
  • Nikki Wilson, PharmD/MBA, Coventry

and Contributing Editor Robert E. Bonner, MD, MPH, Principal, Bonner Consulting Group, LLC.

What does this mean for you?

Compounds can be useful and appropriate for patients with unique and unusual needs. This report provides objective, thoroughly-researched information essential to understanding this issue.

NCCI’s Bill Donnell on the future of workers’ comp

NCCI CEO Bill Donnell was kind enough to grant me an interview a few days before his talk at this year’s AIS…I was unable to attend due to another commitment (the great folks at the Workers’ Compensation Association of New Mexico invited me to their annual meeting)

Here’s my interview with Bill.

MCMWhat is the major focus of NCCI’s Annual Issues Symposium this year?

Donnell – Eighteen months into this role, I’ve been getting feedback from industry stakeholders and thinking about the industry. Our approach is the line of business has been around 100 years, and survived that long because we’ve adapted.  If we adapt, will probably survive into the future, if we don’t we’ll become irrelevant.

MCM – Is WC relevant today?

Donnell – We have a financially stable, healthy system, covering north of 90% of the workforce.  The industry and system has a pretty good history of getting injured workers back to work and our focus is on that, and workplaces are safer than they were a long time ago…[we have] a lot to be proud of.

Another component is the whole issue of technological disruption.  [The economy has] shifted from agriculture to manufacturing to service and now service is vulnerable.  This provides perspective as it is kind of scary, but look what’s happened over time; 70 years ago we would have been saying the same thing. The issues are always the same, but things will come faster than they have before…change will happen but this time it will be faster.

MCM – with the rise of automation, autonomous vehicles, the gig economy, increased robotics and artificial intelligence, what could we see in the future?  What we need to do to be relevant in years ahead?

Donnell -Workers’ comp could be a high risk business only with repetitive injuries [from decline in employment in industries with that risk] gone, it would focus on high hazard risks, there would be a smaller but higher risk pool and smaller overall business.

With the whole issue of industry evolution, we have to evolve, we need to move the ball forward. [We need to] talk about the industry’s past success and show where we’ve adapted to change…[the] good news is that we’ve done this before.  We’ll talk about examples of how the industry has evolved…

Thanks to NCCI’s communications chief Dean Dimke for setting this up.

 

 

Express Scripts buys myMatrixx – a smart move for both

This isn’t surprising; workers’ comp is a very mature industry which demands consolidation.  As the market shrinks, winners will be those with size, scale, and buying power.

myMatrixx has a very strong brand, excellent customer implementation and service, strong clinical capabilities and a solid portal. What it doesn’t have is buying power, and the biggest payers shied away from myMatrixx as it is one of the smaller PBMs with a dearth of hundred-million-dollar accounts.

Express Scripts’ work comp division has scale, a core group of really good professionals, and a few marquee customers.  What it doesn’t have is a strong brand image and the resources demanded by payers increasingly relying on their PBMs for all-things-pharmacy; opioid management, data reporting, patient enrollment and monitoring, physician profiling, high-risk-claim flagging.

Artemis Emslie will assume overall leadership.  I’ve known Artemis for 25 years; she has a very good reputation in the industry and knows work comp pharmacy deeply. As she takes over what is now a very large work comp PBM, I’d encourage her and her new bosses to consider a couple things.

Keep the myMatrixx brand.  Brand is all powerful, and the market message that will be heard is things are changing, ESI is investing in and providing resources for work comp. That is critical.

Keep doing the smart marketing mM has done for years – rides from airports to conferences, the Phil Walls webinars, the overwhelming focus on pleasing customers.

Get out to all customers today, and listen listen listen.  Don’t inundate them with corporate speak and blather, rather ask questions, dig deep, and document everything. This is a great opportunity to hear directly from customers – a very valuable opportunity.

Staff at both companies are excited about the merger; I’ve spoken with several who are pretty pumped.  This itself is unusual and speaks to their inherent grasp of each company’s challenges.

While terms weren’t disclosed (they likely will be at some point as ESI is a public company) my sources indicate the price was in the $300 – $350 million range, a hefty valuation indeed.

What does this mean for you?

The whole is rarely greater than the sum of the parts.  In this case, it will be – if the new entity has adequate resources and sticks with what made mM successful. A stronger PBM with more capabilities is good news for all payers.

 

 

More and stronger evidence that ACA is reducing workers’ comp costs

Is the Affordable Care Act lowering workers’ comp medical costs?

Sure looks that way.

Data from NCCI’s 2016 AIS and HSA clients suggested ACA’s impact was positive and sustained.  Flat-to-declining total medical costs over a two-year period that coincided with the full implementation of ACA were a strong indicator of the law’s positive impact on work comp. Later this week, NCCI’s Kathy Antonello will update us with a first look at the 2016 numbers, and we’ll see if that pattern continues.

I summarized the change in the employed population’s healthcare coverage a while back – noting that many more workers in high-frequency jobs are covered under ACA, a positive factor for work comp. (much more on this can be found here)

Wait, there’s more – Fitch’s just-released review of commercial insurance alluded to the impact of ACA on work comp…

Implementation of the Affordable Care Act (ACA) and a corresponding shift of individual medical care delivery away from workers’ compensation to other markets may also be a factor that bears further study.

Other research from Upjohn analyzes the impact of ACA on workers’ comp.  A couple key points:

  • immediately after workers turn 26 (and thus lose access to their parents’ insurance as allowed under the ACA), the amount of medical treatment paid by workers’ comp goes up – implying that lack of health insurance leads to greater use of workers’ comp benefits.
  • the evidence strongly suggests that the ACA will decrease the likelihood that health care is paid for by workers’ compensation, the size of the cost savings to workers’ compensation is difficult to asses [because]
  • the claiming behavior of people with minor medical needs is influenced by having health insurance. This would suggest that the overall savings to workers’ compensation would be modest. Heaton (2012), however, finds evidence that people with greater medical needs respond to health reform, which suggests that the cost savings to workers’ compensation could be large

There’s a lot more to the Upjohn analysis, and I’d encourage you to read it. Potential issues include access to care and the influence of lower Medicare reimbursement. That said, the authors’ overall summary strongly links ACA to lower work comp claims and medical expenses.

What does this mean for you?

Evidence strongly suggests ACA is positively affecting workers’ comp, lowering claims costs and medical expenses.

Liberty Mutual drops the Research Institute – a missed opportunity

A couple weeks ago Liberty Mutual announced it would be closing its Research Institute in June. The news came as a shock to many, including me. Just two months ago I had lauded Liberty for its ongoing support for research into disability.

Before we discuss the Institute’s demise, allow me to reprise that applause for Liberty’s decades-long commitment to the Institute. Just because they are shutting it down today does in no way diminish the great work it did for years, the commitment by Liberty and its policyholder owners to the greater good. We are all better off for that commitment.

On one level I understand why Liberty did this – it’s the dollars. While no one at Liberty has said so, it looks like a financial move, pure and simple. The Institute’s staff is well-paid, the research itself is likely expensive, and in these times of tight focus on unallocated expense management, cutting the Institute’s non-revenue-generating millions in expenses is a quick way to increase earnings.

But I’d suggest this is a mistake, for two reasons.

First, the financial benefit pre-supposes the Institute is “non-revenue-generating”. That’s true, but it could and should have been used much more effectively to advance Liberty’s brand. Yes, that’s not “revenue-generating” in the strictest sense of the term, but there’s NOTHING more important than a brand.

I asked Liberty’s Communications folks two questions; they kindly responded in a timely manner.

Here’s the first.

MCM – My take is Liberty didn’t aggressively promote the Institute or effectively utilize it in marketing and branding efforts. Yes there was the occasional press release or website mention, but it was rarely front-and-center. Why?
LM – We communicate to our customers and business partners in numerous ways on issues that are most important to help them best manage and mitigate risk. Our Research, Risk Control and Claims expertise all play important roles in helping employers and their employees manage current and emerging risks…
We are also keeping our Hopkinton facility open while discontinuing our peer-reviewed research efforts. Our Hopkinton facility will continue to house our Industrial Hygiene Laboratory and Driver Training program, as well as a personal insurance claims training center.
What is evolving is the way that people live and work, and the dynamics of today’s workplace reflect these changes. Liberty remains committed to helping people live safer more secure lives. We are revisiting our approach to accessing research while at the same time continuing to provide our Risk Control and Claims expertise to help commercial insurance policyholders improve both safety and return to work.

Liberty’s response didn’t address my statement about the relationship between the Institute and the company’s branding efforts. “Communicat[ing} to our customers” is talking to people you already do business with. And, communicating without weaving the brand message into that communication constantly and thoroughly minimizes its usefulness.

In my view Liberty didn’t effectively leverage the terrific work done by the Institute, never really connecting the work it does to support Liberty’s overall “lead safer, more secure lives” brand statement.

The lack of effective brand management is by no means unique to Liberty. Rather it is a major problem for the entire workers’ comp and P&C insurance industries. Every player talks about their people, their great claims management and effective underwriting, but few really differentiate. That is why this industry is commoditized; why buyers switch carriers for a few percent, why risk managers follow their consultants’ advice based on a spreadsheet.

Directly and consistently and broadly and cogently tying the Institute’s work to the impact it had on Liberty customers would have been expensive, arduous, in some cases tedious, and totally worthwhile. It would have greatly strengthened the brand by demonstrating Liberty’s depth of commitment to its brand statement.

My second reason is much more debatable.

In these days of awfully insensitive corporate behavior, the Institute stands as a shining example of doing good work without a direct dollar benefit. It is just the right thing to do. While corporations are obliged to support their shareholders, Liberty is a mutual insurer; its owners are its policyholders. One could, and I am, make the argument that the Institute was and remains prima facie evidence of Liberty’s commitment to its “owners”.

What does this mean for you?
Lots of terrific researchers are looking for work. Please reach out to them; here’s one source. 

Trump de-funds Drug Policy Office…WTF!

President Trump’s budget proposal kills the Office of National Drug Control Policy.

I cannot fathom how any responsible public servant could do this.

In the midst of a horrific opioid epidemic, where we need every possible tool to slow down the death train, he de-funds ONDCP? 

30,000 dead people, thousands of devastated communities, huge societal costs, dead moms and kids and drug-addicted newborns, fentanyl and elephant tranquilizers coming in from China and he de-funds ONDCP?!

ONDCP is the lead agency setting NATIONAL DRUG CONTROL POLICY.  This isn’t some obscure, useless federal agency – these people set POLICY – what the feds do, don’t do, how they work together, what they focus on, where they target their efforts.

Without ONDCP, there is no coherent, cohesive policy; we’ll have a bunch of federal, state, and local organizations tripping over each other, duplicating efforts in some areas while completely missing or ignoring others.

And don’t tell me this is just a wish list – this shows where the President’s heart is, where his priorities are and are not.

This is real, folks. I’ve made no secret of my fear of the Trump administration, I just cannot believe even Trump would do this.

Thank goodness this is too awful for some of his fellow Republicans. 

What does this mean for you?

I don’t even want to think about it.