States are starting to study opioid prescribing patterns – and well they should.
Last week, WorkCompWire arrived with an update on Texas’ plans to assess opioid prescribing patterns for work comp claimants in the Lone Star State. Actually, this isn’t an assessment of prescribing patterns, but rather a very limited review/audit of the top 15 physician opioid prescribers – with some major exemptions.
The opioid audit plan [opens pdf] covers claims with dates of accident in 2010 where the initial opioid prescription was less than 10 days from the date of injury; there’s more than a 30 day total supply of opioids for the injured employee; and the physician audited was the health care provider prescribing opioids to the injured employee.
I asked TDI (via email) why the audit was limited to 15 physicians, when and if the names of the top 15 prescribers will be published, why they aren’t looking at multiple prescibers, and what they will do with the results. The initial response was boilerplate and did not address those questions.
If there’s more follow up (I asked again) I’ll let you know.
The very limited nature of the audit is puzzling; payers have been required to report all manner of information to Texas for several years, with rather draconian penalties for failure to report. With this wealth of data, gathered at great expense and at no small cost to employers and their payers and vendors, it should be relatively simple to provide in-depth information on prescribing patterns around the entire Lone Star State. These data could be case-mix adjusted as well, something that isn’t mentioned in the TDI announcement on the current project. It is entirely possible the Medical Quality Review Panel will do that, but the memo from TDI says the Panel will “assess the medical necessity and appropriateness of prescribing opioids incases selected for this Plan-Based Audit by using their professional expertise and knowledge…”
In fact, case-mix adjusting may be irrelevant, as it doesn’t appear this is a statistical analysis, but rather a kind of peer review.
I’m a bit puzzled as to the intent and outcome of this effort.
While it is admirable to evaluate opioid prescribing, it’s unclear what the reviewers or regulators or enforcement authorities or employers will do differently after the audit.
They’ll have a good perspective on prescribing patterns for 15 docs, but…to what end?
Perhaps this is intended to be a warning shot across the bows of prescribing physicians, letting them know that high prescribers may come under scrutiny at some point. That’s purely conjecture on my part, as I’m not sure I understand the utility of the audit as currently described.
California, for all their ills, has done a creditable job studying and reporting on the physicians’ opioid prescribing patterns. The multiple reports, discussions, and publications resulting from CWCI’s research have led to a much better understanding of the dimension of the issue in California, one that may well have been instrumental in the state fund’s decision to incorporate prescribing practices in network contracting requirements.
I look forward to more dialogue with TDI, and will keep you posted.

Greg Jones’ recent articles in WorkCompCentral highlight the inherent problem in the debate in California around UR; there’s little data on which to base any assessment, much less draw conclusions. Moreover, the data that is available is not consistent; there are no common definitions or consensus around what constitutes a “denial”, an initial review, a secondary review, an appeal, a reconsideration,
Here are the key take-aways from Greg’s May 21 piece:
“Jerry Azevedo, a spokesman for the Workers’ Compensation Action Network, said
between the legislative proposal and reform talk, utilization review is an important topic. It would be beneficial to the entire community to have quantifiable data to understand the real frequency at which requests for medical treatment are being denied, he said.without statistics on utilization review it’s really only possible for stakeholders to base their debate on anecdotal evidence[emphasis added], which is not the best course of action.
“In terms of operating a system and in terms of what we want regulators to do, it needs to be based on statistics and what the numbers really are,” Azevedo said.”
The result of this lack of understanding is, at the least, mass confusion. At the worst, legislators and regulators are called on to make decisions affecting workers comp based on anecdotal information, press releases, histrionic statements, and data carefully selected to represent the perspective of the presenting party.
That’s no way to run a system.
Let’s start with a basic question – what, if anything, are the benefits of UR?
Well, the last credible study I could find was published in December 2007 by Alex Swedlow and John Ireland of CWCI. The study, entitled Analysis of California Workers’ Compensation Reforms; Part 1: Medical Utilization & Reimbursement Outcomes Accident Years 2002 – 2006 Claims Experience”, analyzed the impact of California’s work comp reforms.
Here’s the key data:
“In five of the six treatment categories, the average amount paid per claim for that type of treatment during the first 2 years following the injury declined – the only exception being surgery. Among surgery claims, the average amount paid for surgery services at the two-year valuation point was about 5 percent higher in the post-reform period than in the pre-reform period.”
Okay, I know, this was based on data that is now a bit old, and we need more current information and analysis. But CWCI’s research clearly and convincingly demonstrates that the reforms did have a significant, positive impact. Utilization declined across most medical treatment categories, and since then costs have declined dramatically. Really dramatically.
CWCI will be publishing updated research on this issue later this summer.
It is abundantly clear – from Jones’ article and the confusion surrounding the costs, benefits, and outcomes of UR, that we can’t make any decisions based on the information available today. It’s not sketchy, it’s almost non-existent. And, what we do have is contradictory and unhelpful as basic data field definitions are inconsistent.
As luck would have it, my firm (Health Strategy Associates, LLC) has just begun our first annual Survey on Utilization Review in Workers Compensation. We are surveying C level execs as well as desk-level folks (claims adjusters, claims execs) for their opinions concerning and results of UR.
The On-Line Survey should take 20-25 minutes tops, and one lucky recipient will receive an iPad 2 as a token of our appreciation (make sure you include your contact info if you want a shot at the iPad).
We will be publishing the results of the Survey in June, and hope it provides additional insight into the utility of UR across the industry.

After Dr Barth’s high level background we dove head first into the details of hospital costs and trends and management thereof.
Indiana’s Linda Hamilton shared insights into hospital cost regulation in IN, a state with a rather inadequate cost control history. Hamilton noted the substantial increase in providers appealing work comp payments for their services. A usual and customary state, IN has seen rather significant hospital cost growth, perhaps in part due to the lack of comparable hospital charge data on which to base “usual and customary”. Many of these were addressed by paying bills at the 80th percentile, However as there wasn’t adequate comparable data, the state didn’t really know on what to base payment.
As a result, the cost of inpatient care went up 93% from 2003-2007, and there is no real solution in sight.
Hamilton showed slides indicating wide variation in the cost for similar services within the state: neighboring states are seeing much lower costs. That’s one reason medical costs account for 75% of losses in the state.
If you are expecting a happy ending you’ll have to keep that patience cap on…However Hamilton did note that the state is working on a certified database to help address the difficulty in ascertaining an “appropriate” reimbursement.
Mike Paladino, a WC claim and management exec from a health care system in Richmond, then entertained the audience with a revealing view of the financials of his system.
75% of their revenue is government paid. Paladino asserted that Medicare and Medicaid both reimburse below the actual cost of providing those services; medicare at 80% of costs and Medicaid at 94%. Clearly the health system has to cover those shortfalls by getting private insurers – and workers comp – to pay way more than cost.

A thoughtful and knowledgeable speaker, Paladino noted the services provided by the system benefit society as a whole. He did not claim that the cost shifting that occurs at the system is good bad or indifferent, but it is absolutely clear that it occurs.
My takeaway?
This is a hidden tax on employers and burden on taxpayers and insurers.

Following close on the heels of the National Work Comp Conference is the annual educational get-together put on by the Workers Comp Research Institute in Boston. This year marks the 28th (or perhaps 29th) edition; the agenda reflects how this industry has evolved over those three decades.
I caught up with WCRI Executive Director Rick Victor yesterday to discuss the conference and get a bit more detail on what’s going to be shared with attendees.
MCM – What are the goals of the conference?
Rick – We are focused on most important issues e.g. narcotics, use and cost of medications, and other cost drivers. We want attendees to come away with hard evidence of the nature of problem and information about solutions, including hard data on their effectiveness.
MCM – Any changes this year from past?
Rick – The format continues to evolve; it is a pretty robust mix of research and includes practitioners who don’t always agree with each other or with WCRI. We think it is important to not stack the deck.
MCM – The agenda has a strong focus on pharma – why and what’s driving it?
Rick – We try to align our research agenda with very important national issues like abuse and diversion of narcotics; as you know this far transcends WC and is a national public health crisis. Public policies about pharmaceuticals in WC are about 10 years behind medical policies and medical utilization, and this needs to change.
Some of the actions that public officials have taken about narcotics are not very well informed and not very sophisticated; there ought to be good opportunities to address this issue, if they have good info to make good decisions. Moreover, public decisions don’t make it easy for payers to get into they need to identify abuse and diversion; our research might help public officials to make better decision about what tools are appropriate.
MCM – There’s a session re hospital expense – what will we learn?
Rick – We see in WCRI’s CompScope(r) benchmarking that in a majority of states hospital costs are a bigger driver than non-hospital costs. Hospital price regulation is an area that is elusive for public officials and we would like to bring a bit more light to that. We’ve developed a new tool that will be unveiled at meeting, a hospital cost index, that will make meaningful and interesting comparisons among and between states.
MCM – I note there’s a surprise ending to this year’s conference – What’s the surprise?
Rick – It’s a big issue, an ‘elephant’. Elephants are big and can be nasty, and we want to help show how you might step out of the way when the charge is occurring. We will focus on an issue that is significantly under appreciated, hopefully to move it higher on the radar screen.
You can register for the Conference here.