Work comp pharmacy – early results of 2016 Survey

I’m up to my eyeballs in the 13th (!!) Annual Survey of Prescription Drug Management in Workers’ Compensation; the response from payers willing to devote time to the project has been gratifying indeed.

Previous Survey reports are available here; note these are the Public versions; respondents get a much more detailed and comprehensive version.

A bit of background first.  I conduct these surveys telephonically, speaking to the individual at the insurer/self-insured employer/state fund/TPA/trust who is directly responsible for the pharmacy program. In addition to asking their opinions and views, we get data on a variety of key metrics including:

  • drug spend for 2015 and 2014
  • opioid spend for 2015
  • compound drug volume
  • generic fill and efficiency rates
  • mail order usage

A few early findings.

  1. Pharmacy continues to be seen as more important than other medical ost areas, primarily due to the “downstream” effects of opioids on claim duration, return to work, and related pharmacy spend.
  2. Most respondents are seeing a decline in drug spend.  This is a bit of a surprise, as national research suggests drug costs are going up.  A possible explanation is that (most of) these payers are pretty sophisticated, have been working diligently on pharmacy issues for years, and most (but certainly not all) have employed a variety of programs to reduce unnecessary use of potentially dangerous drugs.
  3. The percentage of spend that goes to opioids varies greatly, from around 21% to over 50%.  Some of this is due to regional or state differences, but much is not. Much more to dig into here.
  4. Mail order continues to be woefully under-used, with most respondents reporting penetration rates in the low single digits.  Argh.
  5. Compound drugs are seen as highly problematic and payers have a wide variety of programs/efforts/mechanisms in place to address compounds.

Much more to come; when the Survey Report is done I’ll post a link.

Enjoy the weekend!


What’s your state’s prescription opioid death rate?

Utah’s is 16 deaths per 100,000 residents.

New Hampshire? 18.2.

West Virginia leads at 24.7.

Rhode Island is well into the double digits at 14.2.

Texas is among the lowest at 2.5, as is Nebraska at 2.8.

For 2014, the national death count was almost 19,000.  You can check every state here.

19,000 people died from prescription drugs – pills that a doctor prescribed for a patient. Not heroin, not crystal meth, not Ecstasy.  Pills a drug company marketed, many of them supposedly “abuse-deterrent”. Pills a stockholder profited from.

I bring this to your attention, dear reader, because the news these days includes some signs that we’re making progress, that opioid scripts are down and things are improving.

They are NOT.

In fact, don’t be surprised if the death count in 2015 hits 22,000.  That’s just a number, but it’s a number built on dead sisters and brothers and cousins and best friends, dead moms and dads and kids and BFFs and girlfriends and hunting buddies.

What does this mean for you?

Please don’t relax one bit.  Keep the pressure on, keep the focus tight, keep demanding answers, and above all, be aware,


Opioids and Workers’ Comp – a quick update

The rest of the world is beginning to catch up to the progress workers’ comp has made fighting the opioid scourge.  Kudos to PBMs, payers, regulators, researchers and some physicians for recognizing the incredibly negative effects of opioids years ago, and taking action to mitigate some of these effects.

That is NOT to say we’re anywhere close to getting this solved – far from it.

But we have seen some evidence of decreases in the number of new claims getting opioids in some areas and an overall decline in opioid scripts and morphine equivalents (MEDs).  We’ll have more information in a couple of months when CompPharma (a consortium of work comp pharmacy benefit managers) releases its 13th Annual Survey of Prescription Drug Management in Workers’ Compensation. (note I’m president of the organization and am conducting the research, past reports are available free for download here.)

A few factoids to give some perspective:

From CWCI’s most recent research:

  • Opioids declined to 27.2% of all scripts dispensed to California work comp patients in 2014, down from a peak of 31.8% in 2008.
  • Average number of morphine equivalents per script declined from 550 in accident year (AY) 2007 to 422 in 2012.
  • The % of work comp patients receiving opioids within 24 months of injury increased from 22.4% in 2005 to 27.9% in AY 2012
  • Express Scripts reported overall spend for opioids declined 4.9% in 2015, the fifth consecutive decrease.
  • Helios reported:
    • the percentage of work comp patients getting opioids declined by 1.6% from 2013 to 2014.
    • opioid utilization dropped 2.9% over the same period

What we have NOT seen is any significant progress dealing with the knottiest and most important problem – long term opioid users.

I can’t count the number of erstwhile start-ups, business ventures, and eager entrepreneurs I’ve spoken with who contend they’ve figured it out.

By definition, anyone who claims to have a universal solution most certainly doesn’t understand the problem.  Unlike reducing initial and secondary scripts, addressing patients who’ve been taking opioids for months is very much an

  • individual,
  • patient-by-patient approach
  • requiring flexibility,
  • a deep understanding of the disease state and chronic pain and addiction,
  • a willingness to experiment and fail, and
  • a very long term commitment to a business model that almost certainly will not be hugely profitable.

That’s not to say there isn’t opportunity – there most certainly is.

What does this mean for you?

We’re at the end of the beginning of the work to address opioids.  This will take focus, years, diligence, and unrelenting focus.

Why be a crook when you can be a dispensing doc?

WCRI’s latest report on physician dispensing confirms what we weary soldiers have known for years; the physician dispensing industry is way better at figuring out how to screw employers and taxpayers than workers’ comp payers and regulators are at stopping them.

We’ve tried eliminating the upcharge for repackaged drugs; they came up with custom-manufactured medications.


Here’s the summary from WCRI:

the mechanism involves the creation of an opportunity to assign a much higher AWP to these new-strength and new-formulation products. Consider cyclobenzaprine HCL (a muscle relaxant), for which the most common strengths are 5 milligrams and 10 milligrams. If a new strength of 7.5 milligrams comes to market and the original manufacturer of that new strength sets a new AWP, this AWP could be much higher than the AWPs set by the original manufacturers for the existing 5- and 10-milligram strengths. These new strengths and formulation, almost all dispensed by physicians, are labeled as drugs made by generic manufacturers, not repackagers, and therefore, are not subject to the new reimbursement rules targeting physician-dispensed repackaged drugs.

Shockingly, Florida and California, two states that have attempted to control doc-dispensed drug costs with a repackaged drug cost cap have seen these “new” drugs become the most popular versions of the drug – and the most costly, with an average price of $3.01 per pill compared to $0.38 for the “regular” formulations.

Why has this 7.5mg version become so popular?

Is it better than 5mg or 10mg versions?

Of course not.

Make no mistake, these dispensing docs – and the industry that supports them, are quite clear about the money.

Proof.  More proof. And even more proof.

WCRI used data from 2 years ago; if anything it’s way worse now.

The solution is both simple in concept and difficult in execution.  Enable employer direction to pharmacies, a situation that currently exists in NY and MN (and in some cases in CA as well).

Yes, limiting doc dispensing to the first few days helps – legislation in IN and PA has been quite helpful in limiting the shameless profiteering of corrupt docs. However, the dispensing industry is quite creative in coming up with ways to circumvent regulations; don’t be surprised if:

  • docs rent a corner of their office to a “pharmacy”, and/or
  • docs get ownership in a pharmacy down the hall, and/or
  • companies are setting up vending machine-like dispensaries in medical office buildings

In fact, these all – and likely other maneuvers – are already operating in many states.  As I noted a year ago, these bad actors “will find any loophole, whether in a states’ pharmacy licensing process, medical board regulation, work comp statute or scope of practice to find a way to continue screwing employers and taxpayers.”

Because that is precisely what they are doing.

What does this mean for you?

It is long past time to stop playing nice.

Obama, Pew, Landers and Paduda

Headed to Atlanta for Operation Unite’s fifth Rx Drug Abuse Summit, an event I’ve been privileged to participate in every year (this year Mark Pew of Prium, Michelle Landers of KEMI, and I are going to discuss formularies in work comp, an issue near and dear to my heart).

This year, President Obama is also speaking.

Think about that.

The leader of the free world is taking a day to fly down, talk, and fly back.  It’s not like the guy has nothing else on his plate – the Middle East, Apple v FBI, global warming, Congress, SCOTUS nomination of Merrick Garland, Pakistan, Iranian cyber attacks, China, trade policy…

and yet Pres. Obama a) decides to go to Atlanta; b) does the prep work necessary to speak on a panel about opioid policy, the FDA, drug approvals, law enforcement, heroin, treatment v incarceration; c) make the trip with all that entails; and d) speak on the panel.

While I’m pumped he decided to make the trip, I’m equal parts disheartened that the President of the United States has to do this.  Moreover, there’s a really impressive list of speakers; Governors, Congresspeople, the US Surgeon General, head of the FDA, Senators, head of the DEA, the CDC Director…

Those of us who’ve been up to our eyeballs in the crisis for a decade are gratified indeed to see the level of attention focused on the issue, and sad beyond measure that this has risen to the level that the President is devoting this amount of time to opioids.

What does this mean for you?

I’d suggest we focus on the positive here, as the negative is just emotionally crushing.

Gov. Baker gets it right on opioids, we got it wrong on crack

On opioids, Massachusetts Governor Charlie Baker (R) has been in the forefront, working with the Democratic-led legislature on intelligent, comprehensive legislation designed to save lives, assign accountability, and reduce costs. The passage and adoption of HB4056 shows what can be done – and what should be done – by every state.

Yet there’s something unsettling about this – for me and for many others.  More on that in a minute.

Friend and colleague David Deitz MD, also a member of the Mass Healthcare Services Board, was involved in this process; here’s his take:

Gov. Baker and his administration have shown real leadership in addressing this issue, and it’s important to note that other groups within the Commonwealth, notably the Department of Industrial Accidents and the Massachusetts Medical Society, have also acted in concert to address problematic opioid prescribing.  The MA Healthcare Services Boards’ guidelines have been updated to reflect the new legislation so there are no inconsistencies.  Much work remains to be done, but this is a good step forward that puts important protections in place for injured workers, in particular.”

Key components of the bill include:

  • a seven-day limit on first-time opioid prescriptions,
  • new efforts to evaluate patients within 24 hours after an overdose,
  • addiction screening for middle and high school students.
  • requires doctors to check a state Prescription Monitoring Program each time they prescribe an addictive opioid to prevent someone from getting prescriptions from multiple doctors;
  • incorporates education about opioid addiction into high school sports training; and
  • establishes a drug stewardship program to dispose of unneeded drugs.

The other 49 states would do well to consider similar legislation.

What bothers me about my/our focus on opioids is that the victims of opioids are generally white, with many middle-class.  Did we – me, you, the powers-that-be, legislators, governors – handle this differently than the crack or “pre-opioid” heroin crisis?

Yes.  And that’s just wrong.

Back when crack and heroin were predominantly a poor and minority issue, it was a crime problem.  Policing, criminal prosecutions and jail time were the approach.  Just contrast the sentencing guidelines passed by Congress and signed into law in the eighties with the legislation pending before Congress today. Crack sentences were 100 times longer than those for powder cocaine.  Today, the bills are all about naloxone, buprenorphine, and addiction treatment, brought to our attention by weeping elected officials.  Back then, it was quite a bit different.

Now that it’s affecting a wealthier and whiter population, the solution is education, prevention, compassion, a disease model of addiction.  Abusers are victims, not criminals.

What does this mean for you?

There are lessons to be learned here, some of them uncomfortable indeed.


The Opioid Pendulum Swings

The CDC guidelines are out, and that’s a very, very good thing.

Yes, there’s an apparently-reasonable argument that the guidelines’ basis is not sufficiently evidence-based to stand up to the most rigorous standards.  There are two reasons that argument fails.

First, opioid advocates, manufacturers, and most prescribers did not worry about “evidence” when pills by the bucketful were prescribed and dispensed to anyone who presented with a sore back.  For advocates to caterwaul about science, evidence, and a lack of randomized controlled trials lasting more than 12 months is unfair at best.

Second, opioids kill more than 24,000 people a year – likely a lot more.  Mothers, daughters, sons, brothers, fathers are dying every day, causing destitution, devastated families, and disaster for communities. The time for half-measures is long past.

I understand this may lead to a few folks who ostensibly “need” opioids not getting their pills quickly or in the volume they desire.

Ask yourself this – how does this “need” stack up against the deaths, ruined communities, and parent-less children caused by rampant overuse of opioids?

I’d imagine the parents, siblings, and friends of those killed by opioids would be only too happy to wait a while or take another drug or try exercise or…


Physician dispensing, opiods and efforts to control same

The last session at WCRI focused on my least favorite topics – doc dispensed drugs and opioids. note findings are preliminary and subject to change.

From Dongchun Wang, doc dispensing.

My takeaways.

Price-focused controls don’t work to control physician dispensing.  Sure, they work over the short term, but the dispensing industry quickly circumvents those price controls by coming up with novel new drugs, increasing the volume, or finding higher base-cost drugs to dispense to their patients.

In fact, prices for doc dispensed drugs-actually INCREASE quarter by quarter post-implementation of price-based controls.

For those of us who’ve been stuck fighting a barely even battle against the profiteering crappy docs and their supporters who do this, this is NOT new news.

Perhaps the to-be-released study will energize payers and employers to finally ban doc dispensing, and/or drive adoption of pharmacy direction (this last is the only real solution), we’ve seen doc dispensing rise even in states that technically ban or severely restrict doc dispensing


Opioids.  Vennela Thumula PhD talked about opioids.  Double Argh.

Okay, the good news is the amount of opioids per claim has decreased somewhat over the last few years, with almost every state seeing a drop (except WI).

  • About 30% of patients that get opioids only get one script – which is fine.  Acute injury, quick treatment, all good…
  • but 70% of so get more than one – and therein lies the issue.
  • NY LA and PA have much higher opioid usage than the average, with NY and LA patients getting well over 3000 MEDs per claim. THIS IS INSANE.
  • the average worker in Louisiana got 7 scripts, due largely to the large percentage of workers who used opioids for more than six months.
  • A significant percentage of opioid-taking claimants were also dispensed benzodiazepines.  WTF are these people thinking?

Drug testing has increased over the last few years – which is fine, except that the top 5% of claimants in LA are getting tested 11 times for 12 substances per test – and the average test costs just under $1200.

This is almost certainly driven by physician-owned labs, which have proliferated over the last few years.  (full disclosure – Millennium Health is a consulting client).

What does this mean for you?

We have a very, very long way to go.

A mass murderer brought to justice.

A California doctor, convicted of second-degree murder was just sentenced to 30 years-to-life in prison for overprescribing opioids that resulted in the deaths of 3 “patients”.

Dr Lisa Tseng’s apparent willingness to hand out scripts to anyone with cash was going on for years and reportedly resulted in the deaths of at least a dozen patients.  Worse, she knew her patients were dying; according to news reports the County Coroner called her office at least monthly to let her know one of her patients had died.

At least a dozen of her patients died of overdoses.

Let’s call her what she is – a mass murderer.

While her motives – apparently purely financial – may have been different than the Ted Bundys, John Wayne Gacys, and Jeffrey Dahmers, her death list is not.  Nor is the impact on the families and friends of her victims.

Her defense attorney complained that the verdict was already affecting other doctors’ behavior.  I should hope so.

Another physician bemoaned the verdict, saying:

“When you use the word ‘murder,’” said Dr. Peter Staats, president of the American Society of Interventional Pain Physicians, “of course it’s going to have a chilling effect.”

Staats said he believes an aggressive medical board — not prosecutors — should go after reckless doctors. But, he added, any doctor who is prescribing pills knowing that they are being abused or diverted shouldn’t be called a doctor.

Let’s understand what’s going on here.  Some in the medical community are totally missing the point.  Over a three-year period, this “doctor” wrote some 27,000 scripts for opioids and other very dangerous drugs.  That’s about 25 each day. 

Instead of whining about “chilling effects” and the impact on doctors, these protesters should be asking themselves why 28,000 people died as a result of “accidental poisoning” due to overdoses.

They should ask themselves why heroin use has exploded.

And why it came to this.

Fortunately, the Tseng case seems to be sparking some much-needed conversation in the pain physician community.  Here’s hoping it results in a lot more caution and far fewer opioid scripts.

Thanks to good friend and colleague Sandy Blunt of Medata for the heads’ up.

The Super Bowl of Drugs

Warning – rant follows…

The two main takeaways from last night’s SuperBowl are:

  • A really good defense and great defensive plan can beat a really good young quarterback.
  • Drugs are where the money is.

I’ll leave the first point to those more expert in football analysis and focus on the second for a minute or two.

In a sign of the imminent arrival of the Apocalypse, there were three ads for drugs shockingly none for life-threatening conditions.  Nope, we Americans must have way bigger concerns than diabetes and cancer – namely the coming open-toe shoe season and the inner workings of our lower digestive tracts.

Yup, there was an ad for a toenail fungus cure, (TOENAIL FUNGUS?!). another for diarrhea (DIARRHEA?!) and one for Opioid-Induced Constipation.  The cheapo fungus ad cost a mere $5 million for 30 seconds; the animated intestine discussing bowel movements graced our screens for a full minute; so did Astra Zeneca’s solution for the opposite problem.

The toenail fungus AND intestine ads came courtesy of Valeant, a name you may recall from news stories about Federal investigations into its pricing practices.  Over the last few years, Valeant has bought up the rights to at least four drugs – then jacked up the drugs’ prices by a factor of 10. (this is getting to be a common practice)

And opioid-induced constipation?

Okay, that’s a problem, but WhyTF are we taking so many opioids that pharma gets to make more hundreds of millions of dollars on a problem pharma created?

What a brilliant business plan; let’s create a drug that makes people feel really good AND is highly addictive, encourage doctors to prescribe it for everything from a sore back to cancer, then, when we have saturated the market so that there’s enough pills sold to give every American a month’s supply every year, let’s charge them three hundred bucks a month so they can poop.

When you watched those ads, did you think about all the zeros on your health insurance bill this month, realize that your family deductible is about equal to what you paid for your first decent car, and see that your choice of providers is best described as “few and far between?”

We are seeing a free market system running wild.

What does this mean for you?

If we stay on this path, we’re bankrupt.