Category: Pharmacy, PBMs, and Pharma costs

Apr
22

Florida’s dispensing legislation clarified

Posted by Joe Paduda on Friday, April 22nd, 2011 | Comments

There’s a good bit of confusion out there about the two physician dispensing bills on the table in Florida.
There are two separate issues here that are often conflated in the media.
First are the pill mills – those storefronts that dispense millions of doses of OxyContin and other narcotics to anyone and everyone who shows up. Florida’s got a well-deserved reputation as the OxyContin supplier to the nation – due almost exclusively to the pill mills.
pillmill2_754502c.jpg
Second is specific to workers comp – according to NCCI, physicians dispensing drugs to comp claimants added $62 million to employers’ costs last year – with no measurable benefit to claimants, employers, or anyone else but the dispensing physicians, drug repackagers, and dispensing companies.
The House version, which passed yesterday in a near unanimous vote, would ban physician dispensing of Scheduled drugs – mostly narcotics, anti-depressants, and muscle relaxants, but allow continued dispensing of non-Scheduled drugs. This bill now moves to the Senate, where a somewhat different ‘pill mill bill’ (SB 818) is under consideration.
Another Senate bill (attached to the budget resolution) is designed to close the loophole that enables physicians dispensing drugs to work comp claimants to charge prices far above retail pharmacies’. This issue has a far smaller constituency, isn’t really recognized as an issue by anyone but a few employers and comp payers, and many seem to think that the House bill would “fix” the work comp problem.
Both bills are desperately needed.
My bet is the politics are such that we’ll see the pill mills banned and no action to fix the work comp problem.

Apr
20

Prescription drug abuse – are you complicit?

Posted by Joe Paduda on Wednesday, April 20th, 2011 | Comments

This morning’s NYTimes has a heart-crushing story about a town in Ohio devastated by abuse of OxyContin and other prescription narcotics.
Here’s what prescription drug abuse has done to Ohio.
– in 2007, deaths from prescription drug abuse (PDA) in Ohio surpassed deaths from motor vehicle accidents.
– more people died from PDA in Ohio in two years than died in the World Trade Center in 2001.
– almost one in ten babies born in Scioto County tested positive for prescription drugs.
Around the nation, the numbers are equally terrifying.
– Prescriptions for opiates (hydrocodone and oxycodone products) went from 40 million in 1991 to nearly 180 million in 2007
– The U.S. consumes 99 percent of the world total for hydrocodone (e.g., Vicodin) and 71 percent of oxycodone (e.g., OxyContin).
– PDA grew by 400% from 1998 to 2008. Four hundred percent.
And that’s just the statistics.
There’s no figure, no number or percentage, that can describe the pain felt by parents, spouses, siblings who lost someone to PDA.
These abusers are getting the drugs from somewhere, and some portion of the drugs that are killing these people are paid for by insurers. At some point, some enterprising attorney is going to ask the question; “What did you know about this person’s drug profile, when did you know it, and what action did you take?”
Play that conversation thru in your mind.
Which leads to the question, what are we going to do about it?
And more precisely, what are YOU going to do about it?
If you work for an insurer or TPA, are you monitoring potential PDA? Looking for possible abuse or diversion? Tracking provider prescribing patterns? Identifying claimants at risk for doctor shopping or use of multiple pharmacies?
Or are you thinking about it, debating, discussing, having meetings and writing memos? Getting ready to get ready?
Not only is there a societal cost of PDA, there’s also a fiduciary obligation. Payers have the technology, data, and analytical abilities to identify potential PDA. It’s time to stop ignoring the problem, get off our collective butts, and take action.

Apr
13

The narcotic abuse problem hits home

Posted by Joe Paduda on Wednesday, April 13th, 2011 | Comments

Today’s local news reported the arrest of a doctor from our small town for allegedly illegal prescribing controlled substances. The physician, by all accounts a well-liked and generally respected member of the community, was charged with illegally prescribing “Demerol, Percocet, Valium and Fentanyl for a patient in a frequency that exceeds his own directions for use.”
I don’t know the person in question, although several neighbors do. I do know this is an all-too-common news story; a cursory search finds similar reports from Ohio, Los Angeles, Pennsylvania, Georgia, and upstate New York where a thirteen year old boy recently died of a prescription drug overdose.
The problem has attracted the attention of Congress, where Senator Chuck Schumer (D NY) recently introduced legislation to monitor, track, and attack illegal trafficking in prescription drugs.
What can be done?
First, a national Prescription Drug Monitoring Program, like the one advanced by Sen Schumer, would be a big step in the right direction. While there are about 33 state-based PDMPs in place today, they are pretty ineffectual. Many are voluntary; they don’t track interstate transactions; many don’t cover all controlled substances, and most are underfunded.
Second, states need to get serious about their PDMPs. The poster child for irresponsible behavior is that model of personal rectitude, Gov Rick Scott of Florida, who’s been trying to shut down Florida’s PDMP before it even gets started. (word is the pressure on Scott may finally be having an affect, as Scott may be changing his position, although one can never tell what he actually will do.)
Third, payers must use their data mining capabilities to ensure they aren’t victimized by this practice; identify high prescribers, determine if that activity is legitimate or not, and engage with law enforcement when red flags appear.

Mar
31

Drug cost inflation – it’s getting bad

Posted by Joe Paduda on Thursday, March 31st, 2011 | Comments

For some time we’ve been hearing about drug costs heading back up – driven by utilization increases (the all-too-common driver) more than price. Of late, price has started to take over the lead as the main cause of drug cost inflation.
From several sources comes news that manufacturers pushed up prices for brand drugs well above medical inflation rates (never mind ‘normal’ inflation, which is much lower than medical inflation). The always-enlightening Seeking Alpha had a piece recently by Daniel S. Levine reporting that the GAO’s research of a market basket analysis of 100 commonly used drugs found “brand name prescription drug prices grew at an annual rate of 8.3 percent from 2006 through the first quarter of 2010, a faster pace than the 3.8 percent annual rise in overall medical costs.”
In total, brand drug prices increased 37.7% over the study period, while generics dropped almost 10 percent.
Fortunately for high generic users (work comp being perhaps the highest), generic drug prices fell over the same period by 2.6 percent per year.
The GAO report (opens pdf) used several pricing levels to develop their report. They examined U&C prices, which are based on the actual cash price for that drug on that day at that pharmacy, AWP, and AMP. While the different methodologies delivered slightly different results, overall, all showed pretty consistent inflation figures.
Another report from Barclays Capital [subscription required for full article] indicated brand prices for the 130 top-selling drugs by sales went up 6.9% in 2010, after an almost-identical increase of 6.8 percent in 2009.
What does this mean for you?
Push generics. And understand that brand prices are driven by brand expiration and manufacturers’ pretty-much-unfettered ability to charge what they want.

Mar
30

Rick Scott and drugs – an ‘inconsistent’ position

Posted by Joe Paduda on Wednesday, March 30th, 2011 | Comments

This am’s WorkCompCentral reported that Florida Gov. Rick Scott spoke out in favor of a ban on physician dispensing of Scheduled drugs – those medications regulated/tracked by the DEA.
It’s indeed encouraging that Scott has finally decided to do something positive about the pill mills that write scripts for more oxycontin than all other states combined. But the Gov, citing what can only be called specious arguments, still opposes a Prescription Drug Monitoring Program.
According to Jim Saunder’s piece in HealthNews Florida, “Scott also at least partially endorsed a House proposal to prevent doctors from dispensing drugs in their offices. Scott, however, added a caveat that such a ban should include “appropriate” exceptions — and didn’t elaborate about what those exceptions might be.”
Moreover, Scott’s new position does nothing to address the $34 million problem.
That’s how much more Florida’s employers are paying for drugs dispensed by docs for workers comp patients than they would if the drugs were dispensed by retail pharmacies.
Here’s how WCRI described the issue:
“Cambridge, MA-based WCRI found that the average payment per claim for prescription drugs in Florida’s workers’ compensation system was $565–38 percent higher than the median of the study states.
The main reason for the higher prescription costs in Florida was that some physicians wrote prescriptions and dispensed the prescribed medications directly to their patients. When physicians dispensed prescription drugs, they often were paid much more than pharmacies for the same prescription.
The WCRI study, Prescription Benchmarks for Florida, found that some Florida physicians wrote prescriptions more often for certain drugs that were especially profitable. For example, Carisoprodol (Soma®, a muscle relaxant) was prescribed for 11 percent of the Florida injured workers with prescriptions, compared to 2 to 4 percent in most other study states.
Financial incentives may help explain more frequent prescription of the drug, as the study suggested. The price per pill paid to Florida physician dispensers for Carisoprodol was 4 times higher than if the same prescription was filled at pharmacies in the state.
The study reported that the average number of prescriptions per claim in Florida was 17 percent higher than in the median state. Similar results can be seen in the average number of pills per claim.”
To say Scott’s position is inconsistent is like saying abuse of prescription drugs is bothersome; a wild understatement.

Mar
25

Docs and drugs – details on the ‘high prescribers’

Posted by Joe Paduda on Friday, March 25th, 2011 | Comments

I wasn’t there, but certainly heard enough about it to wish I was.
I’m referring to CWCI’s annual meeting held yesterday in San Francisco, a meeting that might well have been subtitled “Opioids and the Doctors who prescribe them”.
The report that triggered the excitement (CMS has been asked to review the information, national media has weighed in, and some in the physician community are circling the wagons and attacking the study methodology) was discussed in some detail earlier on MCM; more details on who some of the more ‘liberal’ prescribers were and what they prescribed were presented at the meeting yesterday.
As we get more information on what’s happening with opioid prescribing, the revelations are getting even more frightening, particularly the information about Actiq(r) and Fentora(r), drugs that are only FDA approved for breakthrough cancer pain. Shockingly, there were essentially no diagnoses of cancer in the claimant population
The top 10% of docs who prescribed Schedule II opioids prescribed 84% of the Actiq and Fentora ; turns out that these high prescribers were usually prescribing these drugs for back injuries. (by the way, these drugs commonly cost upwards of $3000 per month…)
Overall, about three percent of doctors treating work comp patients prescribed 65% of the Schedule II narcotics. And, more than half of these scripts were for back strains and sprains.
Meanwhile, in my own home state of Connecticut, we learned this morning of yet another physician caught allegedly using his dispensing powers to enrich himself illegally.
What does this mean for you.
It’s long past time for payers to start working together – or individually – to identify these physicians, find out what’s going on, and take action. We can wait for regulators and law enforcement to act, but in the meantime costs are going up, claimants are dying from overdoses, and the damage to society increases.

Mar
23

Opioids in workers comp – attacking the messenger

Posted by Joe Paduda on Wednesday, March 23rd, 2011 | Comments

This morning’s WorkCompCentral had a piece by Greg Jones noting complaints by medical specialty groups about the study on physician prescribing of opioids recently released by CWCI.
I received a copy of the letter as well, and frankly was surprised – for several reasons.
What was most troubling was the statement that “Alone, the report’s findings do not indicate that there is anything inappropriate.”
I would argue that the findings absolutely indicate there is something very, very wrong going on here. In fact, a relatively few physicians are “handling the bulk of the prescriptions”; that was amply demonstrated in the analysis and results provided in the report, the details of which were discussed in detail therein.
In addition, the statement that “we are not surprised by these early findings” was quite troubling. I certainly was surprised.
Why was this not surprising to the medical society? Was it not surprising that a relatively few physicians were treating patients with low back sprains and strains for extended periods with relatively high doses of narcotics, when all evidence-based clinical guidelines do not support such treatment?
The letter suggested CWCI conduct a deeper analysis to determine whether the treatment was appropriate based on treatment guidelines.
Huh?
Every treatment guideline I’ve heard of, including ODG, ACOEM, Washington State – none of them supports extended use of opiods for treatment of musculoskeletal issues. None.
I would also note that the letter called into the question the methodology itself. The author of the letter’s statement “it is clearly misleading to use
the initial diagnosis” is inaccurate. Even a cursory review of the study
methodology reveals the researchers used a rather sophisticated clinical grouper to identify the PRIMARY diagnosis, which may well not be the initial diagnosis.
Finally, the letter asserted that others had mis-cited or misinterpreted the CWCI work, and requested CWCI somehow correct, clarify, or take steps to correct those misinterpretations. Studies are cited and discussed and reviewed and analyzed in the media and by individuals all day every day; I just don’t think CWCI has the time, resources, or obligation to monitor what everyone says about their research.
I guess is the net is I’m really taken aback by the letter.
There’s clearly abuse going on here, along with bad medicine and out of control prescribing of very addictive, dangerous medications that are ripe for diversion and abuse. I’m just very surprised that instead of taking this seriously, a medical society would attack the messenger. There’s something very rotten going on, and denying it is the wrong approach.

Mar
15

Managing Opioids in workers comp – What to do?

Posted by Joe Paduda on Tuesday, March 15th, 2011 | Comments

I’m up at zero-dark-thirty this am to catch a flight to St Louis, where the International Association of Industrial Accident Boards and Commissions (IAIABC) is hosting a meeting addressing many of the biggest issues confronting workers comp. The three-hour session I’ll be wrapping up today focuses on managing narcotics in work comp, and I’m hoping to learn what works and how.
Unfortunately, it looks like there’ll be a lot more discussion of the size, extent, and impact of the problem of overprescribing of narcotic opioids as there aren’t a lot of long term success stories out there.
There are myriad reasons for the huge growth in the volume of narcotics prescribed in the United States, many of which are way outside the control of those of us in the work comp space. As happens so often in comp, we’re buffeted by societal, economic, cultural, and demographic factors, often left to wonder how the world changed so quickly, and so dramatically, and what, if anything, we can do about it.
Fortunately, there are a couple models out there that hold out significant promise, that appear well-designed to help moderate the growth in the use of narcotics.
Perhaps the best is from Washington State, where the state fund (known as L&I) has long been aware of the issue, and under the leadership of Gary Franklin, has been working diligently to develop and implement intelligent solutions.

I’m going to be listening hard today to the other speakers, and will report back on what I learn.
Thanks to IAIABC for dedicating the time this issue so desperately requires.

Mar
8

CWCI’s Opioids in Work Comp Study – more details

Posted by Joe Paduda on Tuesday, March 8th, 2011 | Comments

Yesterday I posted on the most recent CWCI study on Opioids in the California Work Comp system, noting that fewer than a hundred docs were responsible for prescribing 42% of the narcotic spend.
If that isn’t troubling enough, in an email conversation with lead author Alex Swedlow, I learned that the top ten physicians prescribe 17% more drugs than their peers in the top one percent of prescribing docs (93 docs are in the top one percent).
And, these top ten docs prescribe 34% more morphine equivalents than the others in the top one percent.
Recall that the top one percent of docs who prescribe narcotics are already prescribing far more than the average prescriber, so the top ten are outliers to the outliers.
Is it possible these outliers to the outliers are doing the right thing? Are they just treating the sickest, most pain-ridden claimants? Doing their best to alleviate high levels of chronic pain?
Highly doubtful. It is much, much more likely that these docs, who represent a mere one-tenth of one percent of all docs who prescribed Schedule II narcotics are a major problem, massively contributing to the addiction problem, adding huge costs to the system, and doing little to help their patients. As I said last fall in a post about CWCI’s research on narcotic usage in California’s work comp system;
“CWCI analyzed the impact of these drugs on claim costs, and found a strong correlation between increasing levels of Schedule II payments and adverse effects on injured worker recovery. Swedlow reported claimants that received the highest narcotic dosage levels had 200% higher medical costs than claimants receiving lower dosages.”
An earlier study reported by Business Insurance’ Roberto Ceniceros had similar findings:
“temporary disability claimants treated with opioids average 105 paid days off in contrast to the average of 30 days, than when narcotics are not prescribed.
The preliminary findings also show that when opioids are present in a claim, there is a 322% greater likelihood for litigation, a 264% greater likelihood for lost time from work, and 38% more likely for a claim to remain open longer and incur additional costs.” [emphasis added]
Kudos to CWCI for continuing to shine a very bright light on a very ugly problem, one that should be the highest priority for PBMs, regulators, payers, and prosecutors working in California.

Mar
7

Opioids in workers comp – the prescriber problem

Posted by Joe Paduda on Monday, March 7th, 2011 | Comments

The Pareto Principle states that 20% of the causes generate 80% of the effects.
The Pareto Principle doesn’t apply to physicians prescribing opioids, at least not in California. It’s far worse than that.
CWCI just released a report that indicates three percent of prescribing physicians accounted for 65% of Schedule II narcotic costs.
Just as striking, the top one-tenth of the claimants receiving Schedule II narcotics got their scripts from 3.3 different docs compared to an average of 1.9 across all claims.
These expensive, potentially addictive, and physically debilitating drugs aren’t just prescribed for claimants with serious, complex injuries such as burns, multiple trauma, crushing injuries and the like. In fact, nearly half the Schedule II opioid scripts in California are for minor back injuries.
The report, by well-respected – and highly experienced researchers Alex Swedlow, John Ireland, and Greg Johnson, provides a most compelling picture of the prescribers, claimants, and conditions at the center of the explosion in narcotic usage in workers comp. As always, this isn’t a workers comp-specific issue; in fact we’re only now beginning to come to grips with a problem that has reached its tentacles into nearly every community in the nation.
Six percent of the US adult population admits to abusing prescription drugs – far outweighing the abuse of all non-prescription drugs. And a large proportion of that abuse is centered on Schedule II narcotics; while there’s been a 61% growth in use of all medications in the decade ending in 2008, the growth in Schedule IIs has been six times that at 380%, leading to more deaths from prescription drugs than illicit drug use, alcohol-induced deaths, or firearm-related deaths.
The study itself was based on an analysis of almost seventeen thousand CA WC claims incurred between January 1993 and December 2009, claims that had a total of 9,174 prescribing physicians. Remember that number…
93 physicians wrote a third of all scripts for Schedule II narcotics, scripts that accounted for 42% of narcotic dollars, or $36.6 million.
There’s a lot more information in the study by Swedlow et al, much of it equally alarming. The increase in narcotic opioid usage certainly leads to increased risk of addiction and diversion, reduced ability to return to functionality and work, higher cost, and potentially poor medical outcomes.
One of the tools necessary to control over-prescribing of Schedule II drugs is a Prescription Drug Monitoring Program. Unfortunately, the state with, arguably, the worst diversion problem in the nation – Florida – has Governor who is unable, or unwilling, to grasp the severity of the problem.
For more info on the study, click here.