December 15, 2017

Mark Pew: Rx Epiphany for Work Comp – MSAs

By Mark Pew Senior Vice President, PRIUM

Mark PewEvery so often, circumstances create an epiphany. In regards to prescription drugs for managing chronic pain in work comp, there have been two relatively recent developments that have changed the industry.

In 2009, Centers for Medicare & Medicaid Services (CMS) formally announced it would review future prescription drug treatment in Workers’ Compensation Medicare Set-Aside (WCMSA) proposals based on “appropriate medical treatment as defined by the treating physician.” While CMS had published a 2006 memo requiring the inclusion of Medicare Part D, there was no real guidance on what that calculation should include until 2009.

This clarification meant if a drug had been prescribed and dispensed and paid for by work comp within the past two years, it now needed to be included in MSA calculations. Occasionally, if the physician even mentioned the potential future use of a prescription drug, its cost would be added to the calculation. CMS has continued to refine its position in important areas such as drug pricing, the use of brands versus generics, and off-label drug use since that time, but its action in 2009 initiated momentous change.

The perceived rationale for the CMS position was that the increased use of prescription drugs for treatment of chronic pain and corresponding long-term costs were being overlooked. Because the primary objective for a MSA is to protect CMS’ financial interests for lifetime medical expenses, the costs of these drugs needed to be accounted for properly.

Although the Centers for Disease Control and Prevention (CDC) had already recognized the prescription drug epidemic, this new MSA requirement drew attention to many high-cost drug regimens that were doing clinical harm to injured workers. Yes, the monthly drug costs were expensive. Yes, reserves often had to be revised upward on an annual basis. Yes, injured workers often lost the chance to return to work or even function because of their prescription-drug haze. Yes, everyone from claims adjusters to CEOs knew that prescription drugs were a growing financial and clinical problem. However, the work comp industry had been slow to address the issue until forced to follow explicit rules to calculate the lifetime cost associated with continued inappropriate polypharmacy regimens.

Once CMS forced the issue, addressing the overuse and misuse of prescription drugs, primarily related to chronic pain, became a high priority, one with significant sticker shock. For example, a 30-year rated life expectancy could add as much as $147,000 for OxyContin 80mg, $173,000 for Duragesic 100mcg and $251,000 for Abilify 10mg to the MSA calculation.

The ability and desire to settle and close a claim was dramatically impacted. While claim settlement should be a unique point in time where everyone’s interests are aligned – the payer and employer want to close the claim and the injured worker wants the settlement check – it actually became untenable. Various strategies were developed to deal with that, including the concept of a package of evidence discussed in the “Mitigation Strategies for the Medicare Set-Aside” whitepaper available on PRIUM’s website.

Compounding the issue was the conundrum of a rated life expectancy based on quantifiable co-morbidities like obesity and diabetes and hypertension. Common sense dictates that computation is not wholly accurate when these potentially very dangerous drugs are used long-term because it is entirely possible that injured workers won’t live 30 years on such a polypharmacy regimen. And this leads to a more recent development that might shake the status quo even more, Death Benefits to Injured Workers, which will be covered in next week’s article.

About Mark Pew
Mark Pew has more than 35 years of experience in the property and casualty, healthcare, and technology industries. He created PRIUM’s Medical Intervention Program in 2003, Intervention Triage in 2010, Texas Drug Formulary turnkey solution in 2011, Centers with Standards in 2012, and TaperRx in 2014. From March 2012 thru May 2015, Mark presented educational content 251 times to 15,027 people in 38 states, including nine national webinars. He serves on the Medical Issues Committee of the International Association of Industrial Accident Boards and Commissions (IAIABC), the Workers’ Compensation Committee for the Self-Insurance Institute of America (SIIA) and the Medical/Rehab Committee for the Southern Association of Workers’ Compensation Administrators (SAWCA).

Mark is a popular speaker at workers’ compensation conferences around the country as well as individual continuing education venues. He has spoken at the National Workers’ Compensation and Disability Conference, National Rx Drug Abuse Summit, at statewide or self-insured conferences in 17 states, and at national and regional association gatherings around the country.

A frequent media source for stories on pharmacy and marijuana in workers’ compensation, Mark also writes articles for several publications. He is a regular contributor to Claim Management Magazine, Insurance Thought Leadership, and Lexis Nexis.

About PRIUM
An Ameritox solutions provider, PRIUM sets the industry standard for workers’ compensation medical interventions through its ability to secure higher agreement rates and ensure compliance with modified treatment plans. The hallmark of the medical intervention company’s success is a collaborative physician engagement process encompassing evidence-based medicine, clinical oversight, and jurisdictional guidelines to ensure optimal financial and clinical outcomes. PRIUM eliminates unnecessary treatment through a comprehensive approach that includes complex medical interventions, utilization reviews, and independent medical exams. Based in Duluth, Ga., PRIUM can be reached at www.prium.net or 888-588-4964. For insight on workers’ compensation medical issues, read PRIUM’s blog at www.priumevidencebased.com.

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