The work comp pharmacy benefit management industry is growing increasingly sophisticated, and the release of PMSI’s Annual Drug Trends Report this morning adds to the trend.
Many of the larger work comp PBMs produce similar reports, providing deep insights into cost drivers, the effectiveness of solutions, and trends that anyone with any responsibility for med loss would be well advised to read.
Here are the quick takes from my admittedly not in-depth read of PMSI’s effort.
1. Price was up significantly last year, climbing 4.7%. This is heavily influenced by the price increases pushed thru by big pharma on brand drugs last year in anticipation of health reform.
2. Utilization was up only slightly, driven by more days supply per script.
3. Mail order utilization was up 3.6%, which undoubtedly contributed to the higher utilization as mail order scripts tend to include more days’ supply than those dispensed by retail stores.
4. The average number of scripts per injured worker was 11.1 in 2009. Yep, eleven point one. That’s a lot of drugs.
5. The report includes an interesting chart graphically illustrating the impact of the age of the claim on scripts per claimant; claims a year old typically had around three scripts at an average price per script of thirty bucks or so; in contrast ten year old claims had 23 scripts averaging over $180 each.
6. Generic efficiency (the percentage of scripts that could have been filled with a generic version) remained at 92%. This is driven by several factors, including state regulations (some have mandatory generic language and others are considering adopting it), PBM and payer intervention and outreach, and the ‘macro’ pharmacy market’s introduction of new brands. Generic efficiency and ‘conversion’ is key to cost management; according to PMSI (and consistent with other reports) each one point increase in generic utilization reduces cost by 1.4%.
7. Pharmacy in comp remains primarily, and I’d argue overwhelmingly, driven by pain. PMSI’s data suggests over three-quarters of drug spend was for pain management – one of the key differences between work comp pharmacy and group/Medicare pharmacy.
8. Our old nemesis OxyContin again accounted for a lot of comp dollars, with 9.9% of spend allocated to the brand and generic versions. On the good news side, Actiq and Fentora usage declined significantly (type ‘actiq’ into the ‘search this site’ text box above and to the right for plenty of reasons why this is a very good thing).
9. Finally, the average days supply of narcotic analgesicvs was up 6.4% while the number of claimants getting those drugs actually declined. This may be due to those claimants who could use alternative meds getting off narcotics (or not starting on them in the first place). As a result, the claimants still taking these drugs are more likely to need more meds.
There’s a lot more meat in the report, lots of detail on which drugs are driving how much utilization, changes in utilization by class of drug, and most importantly, the impact of clinical programs on utilization and drug mix.
What does this mean to you?
Two things.
While PMSI is one of the largest PBMs, remember that these data refer to their customers’ experience and therefore may not be exactly equivalent to your book of business. That said, don’t use that as an excuse if your stats aren’t up to snuff – instead look for ways to get better.
As you pack for that summer vacation, grab a copy of your PBM’s report (go to their site and find it there, or call your rep and have them send it over) and perhaps a couple others.
You know you want to, and you can always hide it inside a Cosmo or Men’s Health to prevent mocking stares from the knuckleheads on the next beach towel.
Jul
14
