The single biggest crisis facing workers comp is NOT the market cycle, employment, rate adequacy, or regulatory changes.
It is opioids. As Gary Franklin MD, Washington state fund’s Medical Director says, this is a “hair on fire” issue.
I’m not talking about the $1.4 billion employers spend on these drugs, nor am I referring to the other medical costs incurred by claimants on opioids or the dollars wasted on diverted drugs or the hundreds of claimants dead from opioids prescribed for their injury; not even the disastrous personal impact on claimants and their families.
It’s what opioids do to disability duration – that’s what’s going to drive up rates, kill off carriers, and jack up employer’s premiums.
Claimants on opioids are NOT going back to work; not to their original job, a new job, any job. They can’t drive, operate machinery, think clearly, function physically. Most employers can’t or won’t re-employ opioid-taking claimants out of concern for their safety and additional liability. Can’t blame them either.
The issue is this – the industry has not accounted for the financial impact of the explosive growth in opioid usage among long-term lost time claimants. Sure, a couple of big insurers have figured this out and are moving very fast (and very quietly) to assess the risk and try to mitigate the impact, but the vast majority of carriers, employers, reinsurers, actuaries, and regulators have yet to catch on.
While some are beginning to implement programs in an attempt to reduce the initial use of opioids for injuries, that’s closing the proverbial barn door after the herd is long gone. These programs are often pretty ineffective as well; even if the medical director/case manager/guidelines recommend against approving opioids, adjusters usually approve them anyway. That’s not really the adjuster’s fault; they just don’t have the experience/education/training/support to make the right call.
The real killer is the claim backlog, those old-dog, legacy claims where the claimant has been on OxyContin, Fentora, Actiq, hydrocodone and god knows what else for five years, where the doses have been escalating, there’s been no drug testing for compliance, and the treating doc has no long term plan other than ‘more’.
What does this mean for you?
If you aren’t already deep into a financial analysis of the real impact of opioids on claim closure, disability duration, indemnity and medical expense, start immediately. Not this afternoon, not tomorrow, not after next month’s planning call.
Now.
And don’t settle for platitudes, for “not to worry we’ve got that figured out” statements. Demand projections based on actual experience backed up by real data. And be prepared for some very, very bad news.
But better to get that news now then a couple years down the road from your favorite rating agency. While they haven’t figured this out yet, you can be sure they will.
Apr
5
I agree with you in that this is a problem, likely bigger than most realize, and certainly one that many have not even begun to address, let alone address correctly. I am not sure that some have begun preventing initial use or if they do “that’s closing the proverbial barn door after the herd is long gone”. In my experience, and as a Pharmacy Utilization Review Manager, working every day and night trying to address this issue, and having extensive experience dedicated to this specific area, I can tell you that unfortunately many are not addressing the problem at all during the beginning, or correctly addressing at the middle or late stage of a claim. The few that are addressing, once it is “too late” are not really understanding what the problem is exactly, and therefore do not comprehend how to fix it. I have spent many hours with various clients, and I am talking about the decision makers at many of the companies that are faced with this issue, and I have at times been shocked at some of the impressions many of them have on both the problem and on their impressions of how to address the problem. While there are a few out there that do have an understanding as to the magnitude of the problem, and even less out there that have some ideas on how to address this, most simply are just hoping it will fix itself, or that someone else can fix it. This problem cannot simply be fixed by wishing it away, or as you have stated, quietly trying to fix alone, it requires a concerted effort from the entire community, both the WC arena and the medical community. However, this is far from happening. Try to look up statistics related to the management of this problem, and you will be shocked at how little is really out there (not talking about how much spent on medications/opiates, or how much time lost etc., talking about outcomes of interventions to solve this problem). No one is talking, no one is sharing, and no one can solve this alone. Thanks for continuing to bring the community together to at least recognize we are all in this together, and like it or not, we will all need to fix it together.