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Perspective

Tackling Workers’ Comp Claim Expenses With a PBM Partner

June 07, 2015| By Diane Brown | Workers' Compensation | English

Region: North America

Workers’ Comp insurers inhabit a complex and challenging world. Operating under a medical system that can at times seem to work against the Injured Worker and Workers’ Comp statutes, insurers have to monitor the effect that medical innovation, medical utilization and medical inflation can have on claim costs.

Medical costs account for around 60% of the overall claim costs and of this amount, pharmacy-related claims expenses can represent as much as 20%. That’s why we’re especially pleased to share an article from Tron Emptage and Brian Allen of the pharmacy benefit management (PBM) firm Helios on the prevailing medication trends shaping Workers’ Compensation and the impact a PBM can have on a book of claims.

In their article for us, Tron and Brian discuss how the average wholesale prices (AWP) of brand and generic medications can change. In 2014, for instance, the overall market experienced a high rate of AWP inflation. But their research showed how brand AWP inflation actually decreased slightly, moving from 13.3% in 2013 to 12.5% in 2014. Meanwhile, the upward trend of rising generic AWP inflation, which started in 2013, continued.

While pharmacies and PBMs do not calculate or determine the rise or fall in AWPs, PBMs do manage daily changes for both pharmacies and payers, offering programs to help offset these rising costs, the Helios experts say.

PBMs are also playing an important role in gradually reducing the problematic misuse of opioid analgesics. According to Helios’s own 2015 Drug Trends Report, in 2014 the percentage of Injured Workers utilizing opioid analgesics decreased from 61.8% to 60.2%.

But by collaborating with a PBM, Workers’ Comp payers can put an effective opioid utilization strategy into place that will monitor opioid usage, identify potential concerns of misuse or abuse, and intervene where necessary, providing brighter outcomes for all involved.

Linked to opioid misuse, medications dispensed from the physician’s office and non-pharmacy locations continue to present safety concerns for the injured worker, while increasing costs for payers, the article explains. Other topical risk issues explored in the piece include pharmacists’ practice of compounding medications and the pros and cons of closed formularies, or approved medication lists.

As Brian and Tron point out, with guidance from a PBM, payers can make sure that Injured Workers receive the right medication, in the right dose, at the right time, and for the right duration - and that’s got to be a better outcome for everyone.

For a more in-depth look, read our Insurance Issues publication.

 

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