Jun
5

BWC Ohio picks a new Pharmacy Benefit Manager

Several weeks ago Ohio’s state work comp fund – the Bureau of Workers’ Compensation – selected a new PBM to replace OptumRx.

This has me thinking more broadly about the vendor-customer relationship and how that’s evolving.

First, buyers are getting smarter. BWC’s former and current pharmacy directors (John Hanna and Nicholas Trego respectively) are not just pharmacists, they have become expert in pricing, auditing PBM transactions, understanding contracting language, and negotiations.

According to WorkCompCentral’s William Rabb, BWC learned it was paying OptumRx millions more than it should have after conducting an audit earlier this year.  Quoting Rabb:

an audit showed that the current PBM, OptumRx, failed to keep drug prices below the maximum allowable cost as required.

The audit is here.

Without getting too deep in the weeds here, allegedly OptumRx was supposed to keep generic drug prices at or below a Maximum Allowable Cost, or MAC. However, the audit indicated OptumRx failed to do that, resulting in BWC paying about $5.7 million more for generics than it should have.

Seems straightforward, but this can be hard to figure out as the list of drugs subject to MAC list pricing is often not disclosed.  That is, the PBM has a “proprietary” MAC list which it does NOT have to share with its customer.

Obviously this makes it hard for the customer to figure out if it is paying what it should.

Second, major issues don’t just pop up out of thin air; its unlikely BWC first expressed concerns a few months ago.

Moving an $84 million pharmacy program – or any big service – is no easy task; there’s a ton of systems programming to be done and tested; patients to be switched from one PBM to the new one; adjusters and case managers to train; financial arrangements to be agreed upon; pharmacies and employers to educate; and myriad other tasks.

Payers do NOT make changes unless they have no other choice due to the switching cost, potential business and patient care disruption, and internal stress involved in moving to a new PBM (or any other service type).

Service providers need to ensure that their senior managers and front-line staff understand their customer’s situation, concerns, needs, and plans.  Equally important, senior management must empower their client-facing staff, giving those staff the ability to fix problems, highlight issues, and marshal resources needed to meet clients’ needs. (I’d note that Optum’s work comp PBM recently brought Kaye Lewis back on board to run account management; Kaye is universally well-regarded and one of the best in the business; I had mistakenly said Kaye was working with OptumRx which focuses on the broader health marketplace. I regret the error. )

Third, vendors need to own up to and deliver on their commitments to all involved.  Quibbling over contractual terms, arguing over this clause or that, or word-stretching to avoid doing what the customer or the customer’s advocates need done reflects short-term, myopic thinking.

Sure, you may be “right”, but you’ll win that battle and lose the war.

What does this mean for you?

These days customers are harder and harder to come by, so when you get one, make darn sure you keep them. Listen, anticipate, deliver, and be flexible.

And most of all, meet their needs.


Jun
4

Drug rebates, technology, and what’s next

Two years ago, brand drug manufacturers paid out $127 billion in rebates and other discounts and fees.

That, dear reader, is a ship-load of dollars, and shows just how distorted brand-drug pricing has become.  Huge increases jack up list prices and in many instances consumers’ costs, while those fees flow to payers, PBMs, and other entities in the pharma distribution.

Most consumers’ costs are based on the total price of the drugs they buy, not the net price after rebates etc. As a result, consumers may be paying an inflated price while their insurer gets the rebate dollars. I’d note that in some benefit plans consumers do receive a share of the rebates in the form of discounted drugs or lower up-front costs. Two big PBMs indicate they give about 90% of rebate dollars to their clients. 

Who hopefully pass those dollars along to their members.

Evidently, rebate contractual terms can be opaque, confusing, and subject to misinterpretation, a rather scary possibility given the billions at stake.

I recently spoke with the CEO of a company that’s deep into the rebate management process. Quantivus uses technology to help payers and pharma track all those clauses, heretofores, and whereas-es in rebate contracts to be sure the right dollars are paid for the right drugs to the right entities.

Quantivus’ solution helps stakeholders standardize terms and definitions, allowing them to ensure that they are comparing apples to apples when considering rival drugs – or rival payers. It does other stuff as well, and the company is working on a related service that will tie the negotiated contract to operational systems, helping to standardize reporting of rebate financials for manufacturers and payers.

It’s interesting in a couple of geeky ways; evidently these contracts are so complex and convoluted that they can be mis-interpreted or misunderstood, potentially costing the pharma company or its customer millions. Which there are plenty of.

It’s also interesting in that CEO Lisa Bair and her team have figured out a software solution to a problem that seems to get more complicated and more financially important by the minute.

If I was an attorney focused on rebate contracts, I’d be just a bit concerned that I could be replaced by Bair’s technology.

 

 

 


May
31

Thursday catch-up

Lots going on out there – here’s what you may have missed…

Opioids

The awful people at Purdue Pharma knew damn well their opioids were being misused, repeatedly denied it, and kept pushing their pills on doctors and patients. They lied to investigators, manipulated data, and are directly responsible for today’s opioid disaster. This from Barry Meier’s piece:

credit NYTimes

But the Feds aren’t blameless; in 2007 the US Justice Department allowed Purdue officials and the company to plead guilty to misdemeanor charges.

Think of that – misdemeanor charges for those most responsible for the opioid epidemic. Street corner drug dealers go to jail for years, and these fat cat execs with their lavish lifestyles and fancy lawyers pay a small fine.

I cannot put into words how much I hate these bastards, and how furious we all should be about a Justice Department that let them get away with it..

Breathe…

WCRI is hosting a webinar on the impact of opioids on disability duration on Thursday June 21 at 1pm eastern. Bogdan Savych PhD will address the following questions:

  • Do opioid prescriptions increase duration of temporary disability benefits?
  • Do longer-term opioid prescriptions increase duration of temporary disability benefits?
  • What role do local prescribing patterns play in determining whether injured workers received opioid prescriptions?

The study examines the effect of opioid prescriptions on the duration of temporary disability benefits among workers with work-related low back injuries using data from 28 states, for injuries between 2008 and 2013.

Register here…free for WCRI members, a nominal fee for others.

If you’re wondering why Congress isn’t doing more to attack the opioid crisis – and it isn’t doing much at all – blame the lobbyists, including those working for the AMA, the seventh highest lobbying spender in 2017, with $21.5 million spent.

The AMA is fighting 3-day opioid script limits, mandatory use of Prescription Drug Monitoring Programs, and mandatory opioid education for prescribers.

WTF??!!!

Twisting words to blame the victim

Poor people are less healthy than people who aren’t poor. That’s because their diets aren’t as good, they have poor access to care, their lives are far more stressful, substance abuse is more prevalent, and they are more often victims of crime.

These factors have long been known as “social determinants of health”, the idea that just being poor means moms, kids, dads are going to be less healthy than you and me.

The “work for Medicaid” crowd is attempting to steal the term “social determinants” by using it to claim that forcing people to work for Medicaid is good for them.

That’s just not true. In fact, forcing Medicaid recipients to go thru a maze of paperwork and administrative hurdles to prove they can’t work  – and if that recipient messes up the paperwork, fails to submit it on time, or isn’t able to accurately document their disability,

BOOM! they lose Medicaid coverage.

And they get sicker, and we end up paying for their care in the ER.

And the data shows folks who HAVE Medicaid are better able to find work! From the HealthAffairs piece:

illness and disability are among the primary reasons working-age adults are not employed and this problem is exacerbated when people lack access to the health coverage they need get care for their health problems. Enrollment in health coverage has been shown to be a significant factor in helping individuals find jobs, with over 75 percent of unemployed Medicaid enrollees in Ohio reporting that gaining access to health coverage made their job search easier.

Oh, and at least one state’s policies is blatantly racist.

There’s more, but I have to get to work.

 


May
17

Opioids, marijuana, pain, and workers’ comp

NCCI’s Raji Chadarevian discussed opioid utilization, price, and cost at NCCI’s AIS 2018.

6 percent of opioid medications used in workers’ comp is for treating opioid use disorder; methadone and suboxone are the drugs of choice.

The older the claim is, the more opioids are prescribed. For 15 year old claims, about 2.5 oxycodone pills were prescribed per day. As a result, claims that are more than 10 years old accounted for more than 50% of all oxycodone pills. And, the top 10% of users consumed 79% of pills.

Those heavy users also get a lot of other medications to help them deal with side effects of opioids (and other conditions). These users get about 7 non-opioid scripts for every 10 opioid scripts.  These drugs include gabapentin, benzos, and muscle relaxants.  Fortunately, Raji reported that there’s been a change over time as prescribers have shifted to non-benzo anticonvulsants and made other changes to reduce health risks.

Raji handed the mic off to Dr David Deitz (good friend and colleague). Dr Deitz gave a trenchant and informative description of marijuana, noting that way more is not known about marijuana’s (and its included compounds’) effects on humans than we do know. Some of the effects are reduced anxiety, reduced inflammation, euphoria, appetite stimulation and others you may have experienced yourself.

Dr Deitz then reviewed the state of the science on cannabis – there is substantial evidence of benefit for the treatment of chronic pain and the treatment of nausea due to chemotherapy.  Moderate benefit for anxiety, sleep loss, and appetite/weight loss due to HIV/AIDS has been found.

Evidently there are a lot of restrictions on research into marijuana by the FDA – some seem nonsensical.  These restrictions are screwing up research, and perhaps leading to wrong conclusions.

For work comp, cannabis may be useful as an adjunct, or secondary treatment for:

  • Chronic pain
  • Anxiety
  • Spasticity related to spinal cord injuries

Couple other key points.

Opioid mortality and the use of opioids for Medicare and Medicaid patients both declined in states with legalized use of marijuana.

58% of voters support legalization of marijuana, and 70% oppose enforcement of federal laws in states that have legalized marijuana.

The net – we don’t know much about cannabis, but we do know it absolutely helps in certain conditions, and most folks want it legalized.


May
4

Fast facts about work comp pharmacy

We’re pushing to finish CompPharma’s Annual Survey of Prescription Drug Management in Workers’ Comp next week. After cleaning up the data, we’ve got final figures.

Quick takeaway – we workers comp types are doing a MUCH better job controlling drug usage than the rest of the world  – and MUCH MUCH better controlling opioids.

Here are a few key data points:

  • Total drug spend was down almost 10 percent last year; drug costs are down 22 percent over the last six years
  • In contrast, other payers’ spend dropped 2.1%.
  • Opioid spend decreased by a third over the last two years.
  • Other payers’ opioid spend dropped by less than half that – 14.9%.

While decreases in opioid spend have been dramatic, payers are still extremely concerned about opioid consumption – especially among long-term patients.

There’s a widespread and deep concern among respondents (29 payers of all types) that we’re a long way from figuring out how to help long-term opioid users reduce/eliminate their drug consumption.

This year we dug deep into that issue, and one key takeaway is the current regulatory focus on formularies and utilization review is focusing on a problem – initial prescriptions of opioids – that, while not solved, is much better controlled.

Where payers, patients, prescribers, and PBMs need regulatory help is with chronic opioid patients. Respondents had a raft of suggestions…

  • mandatory urine drug testing done by labs not affiliated with the prescribing physician
  • prescriber documentation of improvements in pain and functionality required before continuing dosing
  • allow payers to reimburse for opioid recovery services while eliminating responsibility for non-opioid related psychological issues

What does this mean for you?

Work comp isn’t known as an innovative or progressive – yet here you are, well in front of other payers and work comp regulators.

Well done.


Apr
30

Workers’ comp opioid usage is way down

CompPharma’s latest Survey of Prescription Drug Management in Workers’ Compensation (past reports available for download) has some very welcome news; over the last two years, opioid spend is down by one-third.

Most of that reduction is from improvements in clinical management and changes in prescribing patterns and behavior.

(I’m finishing up this year’s report draft tomorrow…)

Of the 28 respondents to this year’s Survey, 25 had double-digit decreases in annual opioid spend, and six saw drops greater than 25%.

The opioid spend reduction was a big driver of a reduction of 9.8% in total drug costs across all respondents –  the sixth decrease over the last 8 years.

Couple early takeaways:

  • A dozen respondents cited improved/upgraded/expanded clinical management programs as key drivers of the change.
  •  Big decreases in compound drug costs were also noted by several respondents, with most seeing reductions greater than 30%.
  • In response to the question “Where do prescription drug issues rank compared to other medical service issues at your organization?,” drug costs were rated as a 4.1 on a 5 point scale, (more important than other medical service issues).

This last is telling.

After dramatic improvements in opioid utilization, respondents remain quite concerned about the impact of drugs on claim closure, disability duration, and patient safety.

What does this mean for you?

Progress is great, and much remains to be done.

 

 


Apr
23

Let’s call it what it is.

Opioid prescriptions continue to drop, down 22% from 2013 – 2017. That’s great news indeed…but there are still far too many. The press release from the AMA calls for more Medication-Assisted Therapy, expanded treatment and access to that treatment  – all needed.

One statement in the AMA release really bothers me:

Physicians and other stakeholders accept that bold action is needed. We go where the evidence leads us.

Bullshit.

Reality is, too many prescribers went where the marketers led them, rarely asking the right questions, accepting at face-value claims of smiling detailers, mindlessly mis-citing “Porter & Jick” as rationale for ever-escalating doses of opioids.

If the AMA’s statement was true, we never would have had the opioid crisis in the first place. We all know NOW that the “research studies”, “evidence”, and “literature” used to get docs to prescribe mountains of pills was incredibly weak, completely mis-characterized, and/or non-existent.

We all make mistakes…in this case prescribers made a monumental one. If the AMA accepted some level of responsibility for the opioid crisis and spent a lot less time lobbying against mandatory Prescription Drug Monitoring Programs and quibbling over dosage levels I’d be a little less angry.

I’ve long pilloried many for their role in the opioid crisis, and many readers have as well. It’s long past time the AMA and their fellow travelers acknowledge the harm they caused – and continue to cause – by NOT “going where the evidence leads them.”

Then, and only then, will they will be a credible part of the solution.

What does this mean for you?

Taking responsibility is rarely easy, often painful, and always needed.


Apr
13

When are you going to sue the opioid industry?

States, cities, counties, school districts, and individuals all have sued the opioid industry.  A lot of these have been consolidated in one suit in Federal District Court in Cleveland under what is known as Multidistrict Litigation or MDL. The judge in that case has ordered trials to begin in 2019.

Courts and law enforcement go after penny-ante street dealers, narcos, and their supply chain, and now they are going after guys like this…

This is Arthur Sackler MD of Purdue Pharma, courtesy Wikipedia.

In Cleveland, Judge Polster has ordered the DEA to turn over voluminous records of opioid transactions next week. The records, for a handful of states for 2006 – 2014, will be used to identify what drugs were shipped where by whom.

While hundreds of cases have been consolidated into this one, the Judge, Dan Aaron Polster, has no jurisdiction over many more suits that have been filed independently by individuals, employers, providers, estates, and others.

But the MDL case overseen by Judge Polster is instructive, as he is focused on not only resolving the case, but finding long-term answers to what will certainly be a decades-long struggle to deal with the harm caused by the opioid industry. His intent appears to be to help identify financial resources to help pay for that work.

From the LaCrosse Tribune:

The judge’s ultimate goal is to “dramatically reduce the number of the pills that are out there and make sure that the pills that are out there are being used properly.

“The court observes that the vast oversupply of opioid drugs in the United States has caused a plague on its citizens and their local and State governments. Plaintiffs’ request for the … data, which will allow Plaintiffs to discover how and where the virus grew, is a reasonable step toward defeating the disease,” the judge wrote in an order.

Estimates of the harm already caused and the bills that will come due are in the hundred billion dollar plus range, this for an industry that sold almost $10 billion in opioids in one year, 2015.

So, back to my question.

When is the workers’ compensation industry, a group that buys way more than 10% of the opioids sold every year, going to sue the opioid manufacturers and marketers? 

We are waiting…


Apr
5

Compounds – the stench of corruption

There’s a bill in the US House of Representatives that would greatly expand compounding, drastically reduce the FDA’s ability to oversee compounding, and eliminate many of the desperately-needed controls on this occasionally-deadly and often-abused practice.

Why anyone thinks this is good idea is beyond me, but someone convinced Rep. H Morgan Griffith (R VA) to write a bill and introduce it in Congress, and Rep Henry Cuellar (D TX) and others to co-sponsor Griffith’s bill.

That “someone” may have deep pockets.

Griffith has received over $100,000 in donations from “health professionals” and pharma entities; Cuellar got money too.

Griffith also got more money from the “International Academy of Compounding Pharmacists” than any other candidate for any Federal office.  The IACP has spent millions lobbying Congress to strip the FDA of authority and eliminate controls over compounding.

The IACP and other organizations are seeking to rewrite regulations issued after the New England Compounding disaster, a tragedy that saw hundreds of people sickened and scores killed by contaminated compounded medications. These medications were prepared and shipped by the NECC, a business in Massachusetts that happened to be located right next to a recycling center owned by the same family.

(This is relevant because ventilation systems were one of the problems identified by investigators looking into the causes of contamination in NECC’s products.)

The regulations were issued to implement a law passed by Congress in response to a Congressional inquiry into the disaster.

From wikipedia:

In a congressional hearing the FDA Commissioner was asked why regulators at the FDA and the Massachusetts Board of Pharmacy did not take action against the pharmacy years earlier. The legislators were told that the agency was obligated to defer to Massachusetts authorities, who had more direct oversight over pharmacies.

Yet Griffith’s bill would overturn many of the desperately-needed controls now in place:

The bill exempts from interstate distribution limits the dispensing of a compounded drug from the facility where it is compounded to a patient or health facility.

The scope of Food and Drug Administration (FDA) inspections of compounding pharmacies is limited to pertinent equipment, materials, containers, and labeling, which is the same scope as inspections of pharmacies. (Currently, the scope of inspections of compounding pharmacies is the same scope as inspections of drug manufacturers.)

The bill eliminates the requirement for compounding pharmacies to register with the FDA as drug manufacturers.

As a side note, we’re seeing a dramatic decrease in compounds in workers’ comp, driven by payers’ refusal to pay outrageous charges for “medications” with no proven efficacy. In our annual Survey of Prescription Drug Management in Work Comp, respondents are reporting they paid for far fewer compounds last year than the year before.

That decrease could reverse if Griffith’s bill is passed, and we could well see a return to the days of poorly-regulated profit mills masquerading as compounding pharmacies.

What does this mean for you?

Elections have consequences, and campaign finance laws are killing us.


Mar
30

Cirillo takes over at myMatrixx

myMatrixx, Express Scripts’ workers’ comp PBM brand, will name Mike Cirillo President on Monday April 2.

Cirillo most recently led Injured Workers’ Pharmacy’s effort to enter the PBM space. He has deep experience in work comp claims from his days at the Hartford’s SRS TPA, along with 5 years’ pharmacy experience at IWP.

He will replace myMatrixx CEO Artemis Emslie, who, as we’ve noted previously, announced her decision to step down at the end of last year. Those are some big shoes to fill, as Artemis is universally well-liked and well-regarded for her depth of knowledge and long experience in work comp pharmacy and related businesses.

The changeover comes at a critical time. Currently there are multiple payers deep into the RFP process, more so than I’ve seen at any one time in recent years.  Several are seriously evaluating switching PBMs.

IWP’s effort to launch a new work comp PBM started just over a year ago. The PBM, branded SpecialtySolutionsRx, did not gain much traction, perhaps due to payers’ views of IWP as part of the problem, not part of the solution to work comp drug issues. There is no current information available about Specialty Solutions on IWP’s site.

It is likely SSRx is in a holding pattern for the time being.