Drugs dispensed by docs may be well dangerous

Greg Jones has done a masterful job finding out just who is manufacturing the new “novel” drugs being dispensed by docs to workers’ comp claimants.

In his piece in today’s WorkCompCentral, Jones finds there are just seven companies manufacturing the three novel drugs with unique strengths about which WCRI concluded “it is likely that financial incentives drove some physicians to choose the strength for their patients.” [link leads to abstract, full report available for purchase here]

According to the piece;

Several of the companies [manufacturing the novel drugs] have been fined or warned by the federal government for engaging in unsafe practices, while another paid $12 million to resolve allegations that it paid kickbacks to doctors to prescribe its products. [emphasis added]

We aren’t talking minor misdemeanors, the FDA’s equivalent of parking tickets.  Here’s a quick summary of just a few of these companies’ transgressions.

  • Ranbaxy pleaded guilty to seven felonies and paid fines of $500 million for shipping drugs that weren’t tested for impurities and making fraudulent statements about quality-control tests.
  • Victory Pharma paid $11.4 million to settle criminal and civil allegations re paying kickbacks to prescribing physicians
  • Bryant Ranch was warned by the FDA for failure to put in place systems to prevent contamination during drug manufacturing.  Bryant was also manufacturing at least 10 drugs that were unapproved by the FDA.

There’s much more in Jones’ article, which should be required reading for legislators and regulators dealing with workers’ comp.  

The net is this – putting price controls on doc dispensing doesn’t work; it is blatantly obvious the doc dispensing industry has figured out how to keep generating huge profits despite legislation or regulations in 18 states intended to limit profiteering.

Those profits come from employers and taxpayers, and they come at the risk of sickening or killing claimants.

Thanks to Greg Jones and WorkCompCentral for this - it is wonderful to see that investigative reporting isn’t dead. It is also inspiring to see how real reporters work.

What does this mean for you?

Just say no.  Refuse to pay for doc dispensed drugs.  If providers in your network are dispensing, kick them out.

If your state forces you to pay, use whatever legal methods exist – and every state has them – to delay and deny payment.

Oh, and subscribe to WorkCompCentral, too…

 

Pharmacy Management in Worker’s Comp – 11th annual survey

Is up and available for your downloading pleasure here.

Among the highlights are the following…

  • drug spend for the 25 respondents declined year-over-year, marking the fourth year of flat or decreasing spend
  • despite that good news, payers remain more concerned about drug costs than other medical cost areas
  • opioids and related issues again dominated the conversation (the survey was telephonic and took about 20 minutes) with respondents noting issues related to addiction, drug testing, fraud/waste/abuse/diversion, cost, delayed recovery and increased indemnity expense as concerns
  • compound drugs were identified as the biggest emerging issue
  • respondents also noted that regulations and legislation have not kept pace with developments in work comp pharma such as the growth of physician dispensing

The report contains a host of statistics, data, and insights from the respondents, along with perspective gained from doing the survey for over a decade.

Happy reading!

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.