Physician dispensing in work comp; two victories!

I know, you are as tired of reading about physician dispensing in work comp as I am writing about it.  At last, there’s some very good news.

Quick refresher – docs dispensing drugs adds about a billion dollars in excess drug costs – plus increases disability duration by 10 percent, medical costs, and total claims costs.  Dispensing docs also prescribe more opioids to more claimants.

Benefits?  None, except huge profits to dispensing docs, dispensing companies, and their owners – we’re talking about you, ABRY. (investment firm that owns dispensing “technology” firm Automated Healthcare Solutions)

First up, a court case in Louisiana found in favor of the employer, as the 3rd Circuit upheld a workers’ compensation judge’s determination that a claimant would not be reimbursed for drugs dispensed by a third party pharmacy, in this case Injured Workers’ Pharmacy, when the employer had provided access to other pharmacies and otherwise complied with regulations. According to Troy Prevot, Executive Director of LCTA Workers’ Comp -  “The result of this decision will allow us to continue to use retail pharmacies to control pharmacy cost by negotiating lower pricing thru PBMs” instead of paying much higher prices for doctor dispensed or third-party mail order drugs.  

I’d add that LCTA’s victory will enable all other employers in Louisiana to ensure the clinical management of pharmacy is handled correctly by one entity.

Big news from Pennsylvania too – a bill (HB 1846) limiting physician dispensing duration and cost, and specifically targeting opioid dispensing, will become law (there’s some technical stuff going on, but it will happen). Among other things, the law will:

There has been much heavy lifting here – kudos to AIA, the Insurance Federation of Pennsylvania (the leader of the effort) PCI, the PA Chamber and CompPharma’s member PBMs (full disclosure I am president of CompPharma; the PBMs did the work).

This follows the good results in North Carolina – but all is not rosy, as Maryland and Hawaii employers and taxpayers are still stuck paying far too much for drugs and the crappy outcomes they deliver.

What does this mean for you?

Better outcomes for claimants, lower costs for employers and taxpayers!

Drug formularies – much needed in workers comp

Controlling drug usage in workers’ comp is – far too often – the proverbial pushing on the rope.

Sure, PBMs and payers have done a remarkable job constraining costs and reducing the initial inappropriate use of opioids. Virtually all payers use PBMs and benefit greatly from PBMs’ clinical management and pricing that is almost always significantly lower than the state fee schedule or retail price.

However…the explosive growth of compounding, the fact that a quarter of drug costs are for opioids and a third for physician-dispensed drugs, the inability of clinical staff to get many prescribing physicians to discuss potential alternative treatments, and the frustration experienced by adjusters and employers unable to resolve claims due to long-term, highly-dangerous, and counterproductive use of drugs all argue for more regulatory help.

There are two valuable and too-little used tools in the box; evidence-based guidelines backed up by strong UR and formularies. While many jurisdictions dabble in guidelines, the litigious nature of comp coupled with the imprecise and nebulous wording of regulations often results in more problems, less clarity, and more delays.

In contrast, formularies established in regulation, whether the very tight version used in Washington State or the loose one in Texas, are clear, precise, and incontrovertible.  Drugs are either allowed or not.

CWCI’s just-released study analyzes the potential impact on work comp of those two formularies.  By comparing the drugs dispensed in the Golden State to what would have been allowed by Texas or Washington, Swedlow et al have determined that employers and taxpayers are overpaying somewhere between $102 million and $541 million annually – with no negative effects.

Before some naysayer starts screaming about the unfairness of payers influencing doctors’ treatment decisions, that naysayer should understand that formularies are in place in every group health, Medicare, Medicaid, and individual health plan.  Moreover, said naysayer should READ the CWCI study, and note that a “formulary” may be “set” to require dispensing of the drug that is the lowest-cost but otherwise identical drug instead of a higher-priced-but-otherwise-identical medication – or use any one of several other “levels” to establish a somewhat more restrictive formulary.

Formularies provide better care and tighter control without compromising.  And, a major benefit would be the huge reduction in the contentious and generally pointless UR dealing with drugs…a third of California’s IMRs are for drugs.

An excellent review is in this am’s WorkCompCentral – Greg Jones has penned a thorough, detailed, and well-researched piece that should be required reading.

Physician dispensing in workers’ comp is killing your financials

The cost of physician dispensing is far above the outrageous premiums the dispensers charge.  The real cost includes:

  • longer disability duration
  • higher medical expense – over and above the excess cost of drugs
  • higher indemnity expense
  • more and longer use of opioids

Lost in the conversation, ignored in legislation, and pooh-poohed by dispensers and their enablers, the research – real research by real scientists, not anecdotal BS by dispensers – proves dispensing is having cost implications far and above the cost of the drugs.

In addition to the ground-breaking work done by Alex Swedlow et al at CWCI, the folks at Accident Fund (kudos to Jeffrey Austin White) teamed up with Johns Hopkins to analyze the impact of dispensing on their claims.

The results – which will be discussed next week in an IAIABC-sponsored webinar – are striking.

Slots for the webinar are still available – it will be held next Wednesday, September 10 from 1-2 Central Time.

Kudos to IAIABC for their leadership on this.

 

 

Survey of Drug management in work comp – quick take

This is the eleventh (!) year I’ve been involved in surveying workers’ comp payers to get their take on pharmacy management.  Now that Yvonne Guibert (thank you Yvonne) has finished collecting the data, I’m working on the report.  It’s going to take a week or so, but I’ve pulled a couple highlights to whet your appetite.

  • Overall, drug spend declined for most of the 25 respondents, with some seeing percentage decreases in the double-digits.
  • In addition, total spending (across all respondents) declined as well – by about the same margin.
  • Top problem? close between opioids and physician dispensing, same as last year.
  • Biggest emerging problem? Compounds, without a doubt.
  • 21 of 25 respondents said prescription drug costs were more or much more important than other medical cost issues at their organization.
  • 88% of the 25 respondents (large, mid-sized, and small WC TPAs, state funds, and carriers) have a urine drug monitoring program in place today or will by the end of the year.

Much more to come – the data geek in me is getting all fired up about what we’re going to learn.

Thanks to the 25 organizations who spent time collecting their data, then sharing it with Yvonne.  This is not an easy task, but one that really helps all of us understand what is going on with pharmacy programs, utilization, solutions and cost drivers and how payers are addressing the issue.

Stay tuned…

Friday catch-up – the work comp world

WorkCompCentral’s Joey Berlin wrote up the details of a presentation on chronic pain treatment featuring Gary Franklin MD, Medical Director of Washington state fund L&I, Kathryn Mueller MD, Medical Director of Colorado’s Work Comp department, Noah Aleshire of the National Center for Injury Prevention and Control, and John Hanna PharmD, Pharmacy Director of Ohio BWC.

This august panel laid out the problem and discussed the potential for solutions including cognitive behavioral therapy, exercise, tight dosing and opioid treatment guidelines, and tight formularies. Hanna’s BWC has made solid progress in reducing the number of long-term claimants on opioids, adding more support for the expansion of formularies – and the tight UR rules that make them effective – to other states.

Kudos to CDC for bringing these folks together.

Mail order pharmacy IWP has been sold.  

The auction had been going on for several months, with many private equity firms taking an initial look at the company; the new owners are a quad-umvirate (my new word) comprised of PE firms ACON and Triton Pacific along with two individuals, Patrick Keefe and Tracy Finn.

I’m not a fan of IWP; they rely on doctors and attorneys to get injured workers to use their pharmacy services, claiming that these worthies do it because the workers can’t get their drug otherwise. While that may be true for a (very) few claimants, it most certainly is not for the vast majority.  So, why do docs use IWP? That was the question asked by several of the potential investors I spoke with, and none were comfortable with the answers.

CEO Ken Martino is a long-time friend and colleague, much as I respect the guy I just don’t see the value and the distribution model is a question mark.

Sticking with the pharmacy story line, IAIABC is hosting a primer on Prescription Drug Monitoring Programs on August 26.  PDMPs are another piece of the solution to the opioid disaster, helping to prevent doctor shopping, duplicate therapy, fraud and diversion.  Sign up here.

Payers – insurers, TPAs, and self-insured employers – should pay particular attention as some states allow payers and their agents to access PDMP data, while others don’t.

Off to work – enjoy your mid-summer weekend!

 

 

 

The contentious and misunderstood world of drug testing

Any time you have to mention urine in a blog post you know it’s going to be a tough one.

There’s a kerfuffle in the world of urine drug testing, one of the more litigious and contentious industries I’ve ever encountered.  The parties involved, Ameritox and Millennium Labs, have been involved in litigation for some time now.  [full disclosure, Millennium has been a consulting client for a couple of years; I work closely with them, and have found them to be great people who do the right thing consistently.]

A while back, Ameritox lost a suit brought by Millennium over alleged deceptive advertising; more recently a jury ruled Millennium had improperly given cups to docs in four states, a practice the jury deemed an unfair trade practice. Ameritox trumpeted their “win”, however the jury’s finding was inconsistent with the opinion of several experts in the area, all other charges were dropped, and the case is on appeal.  And there was a serious legal question raised when one of the key witnesses allegedly provided information that perhaps they had no right to.

Be that as it may, the case was noted by friend and colleague David DePaolo, who opined: 

While medical guidelines recommend drug testing for compliance purposes and to help ensure that drugs aren’t being diverted to the black market, we know those are specific case recommendations particular to a certain set of medical facts, not to be applied universally.

But the way medical suppliers stimulate sales with physician gifting and revenue enhancement programs tests the ethical and moral qualities of the individuals on the front lines, and physicians should not be placed in those positions, and we should not be placed into positions of having to pay for it.

Sometimes drug testing is warranted. Most of the time it is not.

A couple comments.

First, research from various organizations including WCRI clearly indicates there’s far too much testing going on of a small population, and far too little of most.  About a quarter of folks who should be tested are, while some unscrupulous docs test every patient every time, making bank.  I respectfully disagree with David’s statement that “most of the time” drug testing isn’t warranted.

Second,

What is correct is to say many more patients taking opioids should be tested, and that testing should comply with accepted evidence-based clinical guidelines; Washington State, Colorado, ACOEM, and others are all excellent sources.

Opioid abuse, misuse, diversion, and related problems have long surpassed crisis status – we’re now in a national disaster with more people dying from this than motor vehicle accidents.  Drug testing is a critical part of the answer.  Yes, there are vehement disagreements among stakeholders, and yes, they can get very contentious, and yes, I have a dog in this fight.  That said, I – and many others – have been working long and hard to bring attention to the opioid disaster, and we need to keep the focus on addressing the problem and not get distracted by tangential issues.

On that all parties should agree.

What doe this mean for you?

There’s a real danger that we over-react, over-simplify this issue, and in so doing make blanket statements that do more harm than good.

 

 

 

Latest changes in the work comp PBM world

Helios is the new name for PMSI/Progressive.  The idea is to have a single name for the two different firms, both of which had positive brand images in the work comp world.  In talking to the marketing folk, their take was that while both brands had strong equity neither legacy name would work for the combined entity.

It seems a shame to end PMSI’s decades-long run, especially after Eileen Auen, Jay Krueger, and their excellent colleagues rescued the PBM from what seemed like a sure path to oblivion.  Instead of watching over the demise, they turned it into one of the top players in the business.  That said, Progressive had a well-earned and well-deserved reputation as a VERY customer-focused PBM; beginning under founder Dave Bianconi (one of the best people in the business…ever). If anything that focus has grown under the current Auen-Young-Sisson triumvirate; customers are (with rare exceptions) universally pleased.

So, Helios it is.

That will be a d/b/a; due to legal, regulatory, compliance matters I would not expect to see the Helios name show up on provider contracts and other legal stuff as that may well trigger all kinds of re-filing and jumping-through-legal-hoops.  But what we’ll very likely see is a big re-branding push, with lots of PR, a new logo, and a splash in Florida next month and Vegas in the fall.

Meanwhile, Aetna’s much-discussed sale of its workers’ comp sub (I know, I owe a bunch of folks on my mis-call on this one) hasn’t been finalized – as far as I know.  In conversations with several potential financial buyers, Coventry WorkComp’s declining revenues and earnings, coupled with the problems inherent in re-contracting a provider network without mother Aetna’s market clout and concern over PBM First Script’s strong ties to network Express Scripts makes for a “sub-optimal-go-forward-scenario.

Yup, that’s a direct quote. I think it means the potential investor doesn’t think they can pay what Aetna wants and get a decent return on that investment.

Undoubtedly, someone else will come up with a different scenario; whether it’s enough is to-be-seen.

Side note - long time First Script exec Brain Carpenter has joined Healthcare Solutions as their top clinical pharmacist.  HCS has been dramatically increasing the number and expertise of their pharmacist corps and the addition of Brian is a big plus. Brian will report toy EVP Jim Andrews; kudos to Jim (who I am fortunate to consider a good friend) for successfully building HCS’ clinical programs.

What does this mean for you?

Stability at one PBM…

 

Compound medications – a killer scam

Compound drug use is exploding – so much so that Texas has changed their employee benefits program to limit reimbursement to $300.  They didn’t have much choice, as the Texas Employees’ Retirement System’s compound drug costs have gone up 4,600% over five years.

That was not a typo.

They’re now requiring prior auth and ONLY covering FDA approved drugs.

The only thing that may potentially slow down the growth is bad news – and that was delivered in spades last week with the news that a coroner’s report found the infant died after ingesting a topical pain cream.  After sustaining injuries at work, the baby’s mother, Priscilla Lujan, applied some of the cream to her knee and back, made a baby bottle, and some of the substance got on the nipple.  The story was broken by Karen Foshay of KPCC; Foshay reported the cream contained the

“antidepressant amitriptyline, the pain reliever tramadol and the cough suppressant dextromethorphan…

Workers’ compensation records show Jarminski’s office billed $1,700 for the initial 25-day supply of the cream. That is much more than the prices of various mass-produced medications, asserted McCann.

Jarminski [the mother's physician] was informed the cream was linked to Lujan’s son’s death but, according to McCann, that didn’t stop the doctor from sending more creams.

“Priscilla had expressed she didn’t want to see that cream anymore or use it anymore,” McCann said. “Despite that they continued to send her more creams by mail and bill workers’ comp for it.”

McCann said at least two to four more tubes of cream were sent to Lujan after her son’s death. It’s unclear how much Jarminski billed in workers’ compensation claims for those additional tubes.

As horrible as this is, this baby’s death may protect others from this deadly scam. The press is all over this, medical malpractice insurers are undoubtedly quite concerned, and law enforcement is getting more engaged.

While one would hope the mother’s doctor prescribed this medication solely for health reasons, the prescribing physician was one of those indicted in the California compound drug case.

Of course, the compounders have hired a PR firm to try to convince us with BS that which they can’t validate with science – and even started an astroturf group to “fight for patients rights”.  Like the right to have tubes of deadly cream lying around…

UPDATE From a colleague’s email -

One strategy that seems to work well in Texas is to approach every compound as Experimental and Investigational and require prior authorization for ALL. The Texas WC UR rules appear to allow for that approach since essentially none of the compounds has gone through specific FDA approval. Without high quality (or essentially any) studies to support their use compounds can only be viewed as E&I in Texas.

At least one large carrier I know of is approaching compounds this way in Texas and other jurisdictions.

For those interested in the current state of research into compounds and workers’ comp, CompPharma’s research paper can be downloaded here.

What does this mean for you?

DO NOT approve compounds without proof of medical necessity and safety.

Work Comp PBMs – it’s drug trend report time

Today’s post is authored by Jack Johnston who is spending his summer interning at Health Strategy Associates; Jack is going to be a senior at Syracuse University (my alma mater); he’s studying Health and Exercise Science.

The three largest PBMs have sent out their annual drug trend reports to tell the Workers’ Comp world what’s been going on this past year.  Instead of you having to read through each entire report and finding out what’s new, I’ve bit the bullet and gone through them for you.  Coventry-First Script, Progressive Medical-PMSI, and Express Scripts have all made much progress and developed new ways to further develop their success.  Let’s give you the skinny…

PBM Goals:

Coventry-First Script has been working with physicians to eliminate the use of narcotics  – due primarily to widely known potential for misuse.  Increasing generic brand utilization to lower costs and helping the older workforce remain healthy enough to work have also been other tasks Coventry’s been working on.

Progressive has managed to accomplish their goal to decrease opioid usage by working with physicians, prescribers, and injured workers.  Progressive Medical is working to ensure injured workers will return to work healthy, as soon as possible, while employers (payers) are getting the lowest possible costs.

Express Scripts is focused on reducing drug costs, utilization, and abuse for workers and prescribers while increasing the use of more affordable generic medication wherever possible.

Summary Findings:

With all three PBMs reporting that OxyContin is once again the most prescribed drug (in terms of dollars) on the market, they’ve been working on ways to decrease the use of opioids.  Progressive reported a 5.0% decrease in opioid usage while Express also showed a decrease of 3.0%.  Progressive also reported that the opioid cost per claim dropped by 6.0% and the workers who were prescribed opioid analgesics this past year used lower dosages compared to 2012; with MEDs diminishing by 9.6% over the year as well.  (First Script did not show any indication of an opioid usage % decrease in their report) correction – First Script indicated utilization per claimant decreased 9.1%, the biggest decline among the three PBMs.

Progressive is using a “Multiple Prescriber Service” to identify injured workers that are getting drugs from more than one prescriber.  With the main focus on multiple opioid prescribers, Progressive notifies all prescribers treating the injured worker and offers guidance to address the issue.

Express Scripts’ MED Management Program allows clients to set max levels for the amount of narcotic medication prescriptions an injured worker can fill.  Once the amount is exceeded, the program employes a review process before additional medication is dispensed. According to Express, the MED Management Program has successfully reduced drug abuse, limited addiction, and controlled costs.

Express has also continued to developed their Physician Outreach Program to encourage the use of generics, which appears to be Express’s main concern.

The First Script network pharmacies are being re-credentialed under stricter requirements including background checks and site audits to ensure legitimate dispensing practices.  The network also blocks narcotics and other controlled substances through mail service to prevent potential drug overdose, diversion, and misuse.  This reduces risk to the patient and the community.

Summary:

  • Opioid use is the main focus of these PBMs.
  • PBMs are having success with decreasing opioid usage through a variety of targeted programs.

What Does This Mean For You?

  • Claimants have a lesser chance to become addicted to their medications (Yay!).
  • Medication costs have lowered over the years.
  • If you’re not using a PBM, sign up and reap the benefits!

Friday catch-up – Obamacare rollout and WC Rx

Another week on the road, and looking forward to a whole week of NO TRAVEL…oh, the luxury of it!

Enough whining – on to the news of import from the last few days.

First up, a quick synopsis of the top news re PPACA rollout:

  • there’s been a great deal of publicity about employers cutting jobs and hours due to health reform and the costs thereof; now comes news from a Harris Survey that 28% of employers surveyed plan to add workers compared to 15% who will cut staff. Also, 10% are going to cut benefits for dependents but 9% are going to add coverage for dependents.
  • Premium increases will be a big driver; VERY early indicators are that they will be all over the place, with some increases tiny and others well into the double digits.  Before anyone gets too excited, remember health plans have almost no data on which to base rate increases – enrollment lagged in some states due to the well-documented problems with the federal exchange, as a result there’s precious little utilization data on which to forecast future costs.
  • states that have not expanded Medicaid are shooting themselves in the wallet.  Medicaid rolls increased by 550,000 in 17 states that did not expand Medicaid; these so-called “woodwork” people included 99,000 in GA and 58,000 in NC.  Of note, the non-expansion states are NOT going to benefit from the Feds’ payment for the increase unlike other states, which won’t be paying a dime until 2017 – and then only 10 cents on the dollar.
  • Ready for a pity party?
    Looks like at least one big health plan is whining about the increased competition due to the Exchanges and new health plans coming into some markets. UnitedHealthcare is moaning about the prices offered by competitors in New York, a huge market for UHC. Execs are claiming other health plans are underpricing UHC’s offerings... (With the news that UHC is the least trusted health plan among hospitals, a little less whining and a bit more introspection might be warranted…)

WCRI’s latest intel on opioid usage in work comp is mostly bad news; the overuse (my word) of the highly addictive drugs did not decline over the study period, which ended in March of 2012. Sure, some states saw slight decreases (yay MA and CT) but others had similar increases (boo MI). Get a copy of the study here.

On the other coast, CWCI reported there’s not been much change in opioid usage in California either.  Their synopsis is:

the use of these drugs has remained at record levels since 2010, that virtually the same 3% of high-volume Schedule II opioid prescribing doctors continue to write more than half of the prescriptions, and that nearly half of the prescriptions are for minor injuries where medical evidence does not clearly support Schedule II opioid use. [emphasis added]

The fine folks in Minnesota are pushing science into the art of pain management; WorkCompCentral reports Minnesota is tightening rules re pain pumps and spinal cord stimulators. Three cheers for L&I…

Of note, several work comp PBMs have released their annual drug trend surveys; I’m reviewing them and will report back early next week.

Finally, our friends at IAIABC are hosting a free webinar on compound medications in work comp May 29 from 1-2 CST; I’m emceeing; the real experts presenting Phil Walls of myMatrixx and Sarah Randolph of Express Scripts.