Mitch Freeman, Chief Sales and Marketing Officer, PMSI
Rapidly accelerating pharmacy costs and risk to patient safety due to physician-dispensed medications is one of the key issues facing the workers’ compensation industry today. It now accounts for over one-third of pharmacy costs, according to the National Council on Compensation Insurance (NCCI). The issue is widely acknowledged in the industry, but there is little consensus on the best way to address it.
A major problem with physician dispensing is that pharmacy transactions occur outside the normal Pharmacy Benefit Manager (PBM) channel. Because of this, the role that the PBM typically plays can be adversely affected. The PBM is often more knowledgeable of the therapies for workers’ compensation-specific injuries and thus, can provide valuable insight into appropriateness and utilization of medication.
Additionally, physicians may not have access to the injured worker’s entire profile of medications dispensed and utilized outside their office. This can cause safety concerns, specifically regarding narcotic usage. PBM insight helps eliminate multiple prescribers, over-utilization of same or similar medications, and reduce risk of drug-to-drug and drug-to-disease interactions.
The PBM is also a known entity for cost containment. PBMs typically have negotiated rates with pharmacies to enable much lower unit cost pricing. A PBM can examine the utilization of a drug, seek generic substitutions, employ formularies and provide peer-to-peer intervention to help promote use of appropriate medications and services while still providing access to the medications an injured worker needs for recovery.
At a time when workers’ compensation pharmacy costs are much higher than they should be, payors need to pay very close attention to where their workers’ compensation dollars are going. The PBM can play a very active and important role in helping to control highly inflated costs for drugs from physician dispensers, while reducing risks for injured workers. Some areas where a PBM can help payors manage and impact the practice of physician dispensing include:
Advocate for legislative and regulatory control
The PBM must help drive legislative changes that protect legitimate pharmacy therapy access while limiting the inflationary cost of medication. PMSI’s Government Affairs department is very active in monitoring and participating in legislative and regulatory action, evaluating the impact these changes make in the industry, and promoting positive public policies on behalf of our clients and their injured workers.
Control costs at the point of care
The PBM has the unique ability to utilize pharmacy data to predict and identify high-risk claims. The PBM should monitor pharmacy data, including physician-dispensed medications when they become known, and evaluate for clinical appropriateness. It should then intervene where necessary with clinical programs. The PBM can monitor and address multiple prescribers and dispensers, reducing the risk of fraud, waste and abuse as well as improving care for the injured worker. It can also leverage formularies and clinical guidelines to help at the time of dispensing to ensure that medications dispensed are medically appropriate for the injury.
Capture out-of-network spend, especially physician dispensers
PMSI, for example, has specialty networks which include select physician dispensers. These contractual arrangements with non-traditional pharmacy providers allow us to negotiate network pricing, provide better clinical oversight, and open the door for communication with the physician.
Ensure billing is correct and that state edits on physician dispensing have been applied
Medication and associated office visits are often on the same bill, making it difficult for bill review companies and payors to separate the two distinct services and associated costs. In addition, physician-dispensed medications are often repackaged and assigned a new National Drug Code (NDC) number with a significantly higher Average Wholesale Price (AWP). When appropriate, the PBM should ensure that reimbursement has been properly applied utilizing the product’s original NDC and lower
As states work to enact legislation to control physician dispensing, it is the responsibility of the payor to ensure that there is a balance between medically appropriate care and cost containment. If your PBM isn’t taking a proactive approach to addressing physician dispensing, you could be wasting hundreds of thousands of dollars and possibly putting your injured workers at risk.
About Mitch Freeman
As Chief Sales and Marketing Officer, Mitch Freeman provides sales and operational leadership for PMSI, Inc., a leading provider of cost containment solutions for the workers’ compensation industry. With many years of industry experience, Mitch leads PMSI’s efforts for sales and go-to-market strategies. He is charged with overseeing the sales team and generating cross-selling opportunities. A trusted senior advisor and pharmacist, his focus is on building the PMSI brand and creating deep client relationships.
Prior to joining PMSI, Mitch held a number of leadership positions within the workers’ compensation industry, including vice president of sales at Ameritox, vice president & general manager for Express Scripts, and president of pharmacy services for MSC. He is well-regarded across the industry and brings a strong record of success to the company.
Mitch is a graduate of Florida A&M University where he received his Doctor of Pharmacy degree.
Founded in 1976, PMSI is a leader in developing solutions to control the growth of medical costs in workers’ compensation. As one of the nation’s largest and most experienced companies focused solely on workers’ compensation, we deliver proven solutions for cost containment across the claims lifecycle. PMSI’s solutions for Pharmacy, Medical Services and Equipment, and Settlement Solutions deliver quantifiable results and improve the quality of care for injured workers. We provide our customers with the innovation, focus, expertise, analytics and technology needed to successfully deliver workers’ compensation benefits.
For more information on PMSI, visit: www.PMSIonline.com
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