By Joe Paduda, Author, Managed Care Matters
The single biggest crisis facing workers comp is NOT the market cycle, employment, investment returns, 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.
Although there’s precious little evidence that opioids are appropriate for the long term treatment of musculoskeletal injuries, the misuse of these addictive, expensive drugs is not the real problem. While the $1.4 billion employers spend on these drugs is a huge waste of resources, that’s not the biggest issue. Nor is it the added medical costs incurred by claimants on opioids for drugs and therapies to deal with side effects ranging from rotted teeth from Actiq to constipation to depression to sexual dysfunction. The dollars wasted on diverted drugs (and the crime of diversion itself) is a growing problem; much worse is the hundreds of claimants dead from opioids prescribed for their injury and the disastrous impact on claimants and their families inherent in long-term use of these powerful, addictive drugs.
It’s disability duration.
Claimants on opioids are NOT going back to work; not to their original job, a new job, any job. Most are likely addicted or dependent on these drugs. 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.
This isn’t just a theory or conclusion based on logic; recent studies published by CWCI and in medical journals provide ample evidence of the crushing impact of opioids on disability duration.
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. And very few payers have developed, much less implemented, processes to screen for addiction and/or diversion.
The real killer is the claim backlog, those old-dog, legacy claims where the claimant has been on OxyContin, Actiq, hydrocodone and god knows what else for 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’.
Payers often point to the legal system as a big part of the problem, complaining that even if they do try to cut off opioids, administrative law judges overrule the payer and the claimant continues to get their narcotics. While that’s undoubtedly often true, it misses the point – regardless of where the fault lies, payers are going to be the ones bankrupted by opioids.
Some will lament their fate, while others – the ones who will survive, will attack the problem.
That’s for next week’s column.
About Joe Paduda
Joseph Paduda is a nationally recognized expert, speaker, media source and author on managed care in group health and in workers’ compensation. He translates complex data into actionable knowledge and is able to take an aerial view or to drill down into intricate niches.
His practical approach and 20 plus years experience in the field give clients precise direction and applicable programs.
He writes the popular weblog Managed Care Matters attracting more than 1500 unique visitors a day and a good deal of comment in the health care world. His blogs are frequently republished on other sites. Mr. Paduda also conducts industry surveys, including focused on managing pharmacy costs within workers’ compensation, bill review in workers comp, and work comp claims systems.
Prior to founding Health Strategy Associates in 1997, Mr. Paduda served in sales, marketing and management positions with managed care and insurance companies, including MetraComp, a United Health Care Company, Travelers Health Company, Liberty Mutual and American International Healthcare/AIG.
A frequent speaker and prolific author, Mr Paduda has appeared on ABC’s Nightline, Fox Business News, AirAmerica, and NPR and been featured in The New York Times, LA Times, TheStreet.com and many industry publications.
About Health Strategy Associates
Health Strategy Associates is a national consulting firm specializing in managed care for workers’ compensation and group health. The firm serves insurers, managed care companies, employers, health care providers, and venture capitalists.
Developing a successful managed care program is like mastering chess, a game in which a series of decisive, logical moves – driven by analysis, research and insight – lead to victory. By constantly monitoring the world of health care and the macro factors and policies influencing it, we help clients make informed and intelligent decisions.
Principal Joseph Paduda has an unrestricted view of the national market and its players and an uncanny ability to take a big-picture view and drill down into the smallest niches. His advice will help you summon the full force of your resources to create better products, stronger market share and greater profits.