Florida’s solution to the high cost of repackaged drugs

Mike Whitely of WorkCompCentral’s piece [subscription required] this morning about Miami-Dade Schools’ solution to the high cost of repackaged drugs should be required reading for any employer or insurer operating in the Sunshine State.
As noted here and elsewhere, a loophole in the Florida workers comp law allows drug repackagers and their affiliated technology and billing companies to set the price for drugs at whatever amount they desire. As the law requires payers to reimburse at AWP + $4.18 for dispensing, if the AWP for a repackaged drug is 5 times what the same drug would cost at a retail pharmacy, too bad – for the payer.
However, there’s another law on the Florida books that provides a solution – simply stated, employers and insurers that contract with a PBM or a retail pharmacy for drugs can pay that contracted amount for any script from any dispenser. That’s correct – the payer’s liability to the dispenser is the same as if that drug was dispensed through one of the payer’s contracted pharmacies.
Miami-Dade Schools began implementing this policy September 15 of 2009. Since that time, the Schools have saved an estimated $700,000 – the equivalent of about eight teachers’ pay and benefits.
A letter [opens .pdf] from Florida CFO Alex Sink (currently a candidate for Governor) cites the specific statute:

section 440.13(12)(c), Florida Statutes, which provides:
As to reimbursement for a prescription medication, the reimbursement amount for a
prescription shall be the average wholesale price plus $4.18 for the dispensing fee, except
where the carrier has contracted for a lower amount. Fees for pharmaceuticals and
pharmaceutical services shall be reimbursable at the applicable fee schedule amount.
Where the employer or carrier has contracted for such services and the employee elects to
obtain them through a provider not a party to the contract, the carrier shall reimburse at
the schedule, negotiated, or contract price, whichever is lower. No such contract shall
rely on a provider that is not reasonably accessible to the employee.

and makes this recommendation:

The Division urges employer/carriers providing reimbursement for prescription medication under Chapter 440, Florida Statutes, to take section 465.0267(1), Florida Statutes, into consideration when making prescription provider reimbursement decisions.

What does this mean for you?
Well, what are you waiting for? Talk with your PBM, ask them to implement Ms Sink’s recommendation, and start reducing your drug costs.
Disclosure – I gave $250 (or something like that) to Ms Sink during her campaign for CFO some years ago. She’s been a strong advocate for Florida’s employers – and workers – and I remain a supporter.
(Note – I received this in an email from a Florida Insurance consulting firm. I appreciate their correction.
“In reading your most recent article about physician repackaging, I noted an incorrect statutory reference. The referenced “section 465.0267(1)” does not exist in Florida Statutes. I am quite certain that it should read “465.0276(1).”. The mistake appears to not be yours as it actually originates from Alex Sink’s letter which had the numbers in the citation transposed in one place, but correct in another.”)