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Workers' compensation pharmacy spending increased by 5.4 percent in 2008

Workers' compensation pharmacy costs continued to increase in 2008 despite consistent overall decreases in injury rates over the past several years.

PMSI, a pharmacy benefit manager and provider of specialty services for the workers' comp market, unveiled its 2009 Annual Drug Trends Report. The study examined workers' comp drug spending trends based on the company's nearly 8 million pharmacy transactions between 2006 and 2008.

According to the report, pharmacy costs now represent approximately 14 percent of the total medical spending in workers' comp. Researchers said that the continued pharmacy cost increases represent one of the largest issues facing the workers' comp world.

Among the highlights of the study, researchers found that:

· Overall spending increased. The report found that workers' comp pharmacy costs increased by 5.4 percent in 2008, compared to 3.3 percent in 2007.

· Drug price contributed to majority of spending increase. Researchers said the price of drugs contributed 4.2 percent to the total spending increase, compared to 3.1 percent in 2007. The 2008 increase, the study found, was due primarily to average wholesale price increases and the reduced availability of generic versions of drugs such as OxyContin.

· The top five most prescribed drug classes remained unchanged from 2007. Narcotic analgesics, anticonvulsants, non-steroidal anti-inflammatory drugs, skeletal muscle relaxants, and antidepressants represented 70 percent of total pharmacy costs and 74 percent of total transactions in workers' comp in 2008.

· Claim age was significant factor driving pharmacy costs. Researchers said the age of a workers' comp claim continued to be a significant driver of pharmacy costs. Injuries greater than three years accounted for more than 80 percent of workers' comp pharmacy spending, the study found.

· Antidepressant use on the rise in workers' comp. Cymbalta, an antidepressant used in the treatment of chronic pain, ranked 10th in total drug costs in 2008, as opposed to 14th in 2007 and 17th in 2006. Researchers said this is the first time an antidepressant ranked in the top 10 in total drug costs and is evidence of the expanded use of antidepressants in the workers' comp setting.

"This year's report illustrates the importance of an effective pharmacy management program that is tailored to the specific nuances of the workers' compensation market," said Dr. Maria Sciame, director of clinical services at PMSI. "Given the complexity of workers' compensation claims, payors should look for opportunities to partner with an experienced PBM such as PMSI to improve network penetration, increase generic substitution, maximize mail-order utilization, and engage clinical utilization management programs. Maximizing these opportunities will lead to better cost containment and improved care for injured workers."

Seven Key Practices for Injured Workers to Follow

 

It is important that injury practices be followed consistently so employees know what to do when there is an injury. The complete procedure for what steps occur in the 24 hours immediately following an injury must be developed as part of a solid workers' compensation cost reduction program.

 

Here are several practices a company can require:

 

1. ALL injured employees participate in a weekly telephone conversation when out of work due to a work-related injury.
2. Injured employees must bring the Work Ability Form to their medical provider and check to ensure the form is completed and faxed back to the proper authority.
3. Injured employees must participate in the employer's return-to-work transitional duty program.
4. Injured employees must participate in weekly in-person meetings at the facility when on transitional duty.
5. Employees must understand even if they are out of work, unless bed-ridden, they are expected to come to the facility for weekly meetings. (workersxzcompxzkit)
6. Although injured, employees still participate in all employee meetings and activities while on transitional duty or out of work unless prohibited by medical restrictions.
7. Employees must understand  they are expected to return to work in transitional duty or full duty position as soon as medically able.

 

Close management of all work-related injuries is key to reducing workers' compensation costs.

 

Author: Rebecca Shafer, J.D., Rebecca is an attorney and consultant with Amaxx Risk Solutions. Her clients typically reduce their workers' compensation costs 20-50%. You can read more about her tools and techniques at www.ReduceYourWorkersComp.com and she can be contacted at RShafer@ReduceYourWorkersComp.com or 860-553-6604.