St. Louis, MO – Significant increases in cost per prescription drove drug trend for workers’ compensation payers higher in 2013, according to research recently released by Express Scripts (NASDAQ: ESRX). Overall pharmacy spending for workers’ compensation increased 9.5 percent, according to the Express Scripts Workers’ Compensation Drug Trend Report, primarily from an 8.2 percent jump in cost per prescription. Effective management programs helped keep utilization increases to just over 1 percent.
Drug trend — defined as the annual rate of increase in pharmacy spending — is the combined effect of changing drug prices and utilization.
The Increasing Challenge of Compounded Medications
Compounded medications used for injured workers saw the most significant increase, with per-user-per-year costs rising 126 percent from 2012. Although these medications account for just 2.7 percent of total pharmacy costs in workers’ compensation, the dramatic rise in price impacted overall trend.
Compounded medications are tailored drugs prepared by mixing, combining or altering ingredients. While intended to address special pharmaceutical needs of some injured workers, compounds tend to be significantly more expensive than commercial formulations. In many cases, there are Food and Drug Administration-approved alternatives for compounded medications. Compounded medications can also pose safety issues.
“Without consistent protocols to prepare each drug, compounded drugs can have a greater batch-to-batch variability,” said Tim Pokorney, senior vice president, clinical services for workers’ compensation at Express Scripts. “This raises significant safety concerns as injured workers could be receiving medication with a higher potency than intended.”
Express Scripts helps payers effectively manage the rising costs of compounded medications and ensures safe treatment for injured workers. At the point of sale, clients have the option of reviewing all compounds for authorization. Retrospectively, Express Scripts sends letters to physicians encouraging the use of commercially available, cost-effective alternatives where appropriate. Our research has shown that 42.3 percent of injured workers whose physicians received such communications from Express Scripts discontinued filling compounded medications, thus helping drive down costs for payers.
Narcotics Remain Costliest Therapy Class
Higher prices in other therapy classes also contributed to the growing trend. Key findings of the Workers’ Compensation Drug Trend Report include:
- Narcotic analgesics continue to be the costliest therapy class for work-related injuries, accounting for 32 percent of overall pharmacy costs. While utilization has declined for the third straight year, costs continue to rise.
- Cost per prescription for hydrocodone-acetaminophen, a long-standing generic, increased 7.2 percent — twice the increase in 2012.
- Non-steroidal anti-inflammatory drugs — or NSAIDs — which are non-narcotic medications used to address various pains and conditions, saw a 19.4 percent increase in cost.
- Specialty medications, including those to prevent blood clots following a surgery, osteoarthritis and inflammatory conditions, make up only 1 percent of overall pharmacy spend in workers’ compensation but pose a growing cost challenge for payers. The average cost per prescription of a specialty medication was more than $1,119 in 2013 — nearly nine times that of the average traditional medication.
A copy of the report is available here: Express Scripts 2013 Workers’ Compensation Drug Trend Report
Printed copies also will be available at the Risk Management Society (RIMS) Conference, April 27-30 in Denver, in booth #220.
Source: Express Scripts