Five workers’ comp pharmaceuticals trends to watch out for in 2024

Five workers’ comp pharmaceuticals trends to watch out for in 2024

Five workers’ comp pharmaceuticals trends to watch out for in 2024 | Insurance Business America

Dispensing and opioids have been persistent challenges

Five workers' comp pharmaceuticals trends to watch out for in 2024

Workers Comp


Johnny Taylor, Gallagher Bassett AVP, ancillary networks & pharmacy shared five trends in workers’ comp pharmacy to look out for in 2024, and two have been floating around for some time: physician dispensing and opioid utilization.

“Physician dispensing has been a challenge within the market for quite some time,” Taylor said. “If you go back about 10 years or so, there was a lot more prescribing patterns out of clinics related to opioid medications. We’ve since seen that subside.”

There has been a shift in prescribing patterns within the workers’ comp system, but every state has different guidelines and regulations, with Florida still encouraging physician dispensing.

“Until something changes at that legislative level, it’s going to persist,” Taylor said.

Furthermore, while the opioid epidemic is still running rampant, the AVP applauded workers’ comp for being able to help limit the prolonged use of this calibre of drug over the years. 

“There’s a much tighter hold and controls in place today than there probably ever has been, which is encouraging,” he said.

“In our book of business, around 13% for those types of medications are used in the therapeutic class, whereas less than a decade ago, it was closer to 30%.”

In an interview with Insurance Business, Taylor spoke about how mental health, long COVID and inflation are also trends to be mindful of in the space. He also revealed why utilization management is key for workers’ comp going forward.

Workers’ comp pharmaceuticals moving in new directions

Long-COVID is still undergoing strict medical scrutiny, and that is especially true at a workers’ comp level.

“While there is a lot to think about in terms of the potential impact in pharmacy, I like to think of the broader picture and all of the different components related to a workers’ comp claim,” Taylor said.

There have been good datasets from organizations like the Workers Compensation Research Institute (WCRI) on the topic, but companies like Gallagher also want to analyze this growing concern.

“We’re also going to use our own datasets and work with our pharmacy partners to determine how should we evaluate this trend over time,” Taylor said. “It’s a really exploratory phase.”

Elsewhere, with the rise of both mental health diagnoses and awareness, Taylor is interested to see how this will impact workers’ comp pharmaceuticals in the future.

“Right now, different types of therapeutic classes, whether that’s anti anxiety agents or antidepressants, represent probably around 10% of our of our spend in total, and that’s been pretty consistent, year over year,” he said.

“Although, if more carriers start to deem these claims, compensable, it’s going to be interesting to see how the market reacts. And really, that’s the million dollar question we just don’t know yet.”

As a result, Gallagher Bassett is connecting with various doctors, medical directors and pharmacists to leverage its data to put something into action.

However, the lack of medical resources in the mental health field is proving to be problematic.

“There’s just not enough behavioral health specialists that are experts in this field,” Taylor said. “And the ones that are currently out there are highly coveted and getting them into a work comp system where you can have national access is really the challenge.”

The persistent problem of inflation

The effects of inflation on workers’ comp continues to lag somewhat, according to Taylor.

“A lot of the fee schedules within pharmacy and workers’ compensation are based on the AWP,” he said. “We haven’t really seen the impact of the inflation hit the AWP.

“On average, we see about a 3-5% increase in the average income up year-over-year.”

However, this does not mean that the industry is immune to the economic challenges that are currently plaguing other parts of the economy.

“With supply chain issues, the cost of goods and everything going up, I do think we’re going to see more of an increase over the next year than we have in the past,” he said.

Rethinking how drugs are dispensed

One area that workers’ comp professionals should be working diligently with their network of pharmaceutical and medical professionals is to alleviate any unnecessary prescriptions, especially for addictive substances like opioids.

“What we see in work comp, especially when you’re dealing with injuries is that opioids are appropriate, whether in a post surgical setting or when dealing with an injury,” Taylor said. “But there can be adverse consequences down the road, whether that’s a potential addiction or health consequences for being on these types of medications long term.”

It is important to have a series of checks in place to make sure that these prescriptions are warranted in the long term.

“Workers’ comp should develop better clinical intervention programs with its partners, even if the prescribing patterns are warranted from a medical standpoint,” he said.

In the case of opioids, there are topical solutions, some that are over the counter and much more affordable, that can be used as a substitute if this is deemed suitable by a doctor.

While cost containment is important in the workers’ comp space, Taylor believes that utilization management should be top of mind.

“The cost of a medication that should not have been dispensed in the first place may be less than an extra 10 points on a contract, but having no oversight into how the drug is [used is] ultimately more detrimental,” he said.

Do you think these trends will hold true throughout 2024? Sound off in the comments section below.

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