Workers Compensation and Prescription Drugs: 2016 Update

Transcription

NCCI’s 2016 Annual Issues Symposium
Workers Compensation
and Prescription Drugs:
2016 Update
Sean Cooper, FCAS, MAAA
Director and Senior Actuary
May 5, 2016
© Copyright 2016 NCCI Holdings, Inc. All Rights Reserved.
Why Are Prescription Drugs an
Important Topic in WC?
 The projected prescription drug (Rx) share of



total workers compensation (WC) medical costs
for Accident Year 2014 is 17%
 Rx averages approximately 45% to 50% of
annual medical costs for active claims older
than 10 years
Rx payments reported through NCCI’s Medical
Data Call were over $1 billion in 2014
Rx is among the most active subjects of
legislative activity in WC
In 2014, Rx price inflation was higher than
overall medical price inflation
2
Recent WC Rx Findings
 Rx prices increased 11% in 2014. This is




substantially higher than the 10-year average
increase of 4%.
Rx utilization declined by 4%. This kept the
growth in Rx costs per active claim to 6% in 2014.
Controlled substances prices increased 16% in
2014 while utilization was down 7%.
Both physician-dispensed Rx prices and utilization
increased 4% in 2014.
The share of generic Rx costs increased in 2014
due to increases in prices and utilization.
3
The Big Picture
Recent Activity Regarding Rx in WC
Drug Formularies
Limitations on Physician Dispensing and Repackaged Drugs
Opioid Treatment Plan/Agreement and Drug Adherence
Choice of Pharmacy
Medical Conditions Resulting From WC Prescription Drugs Are Compensable
Pharmacy vs. PBM (Pharmacy Benefit Manager)
5
The Incremental Rx Share of Total Medical
Costs Increases Rapidly as Claims Age
60%
Rx Share of Total Medical Costs
55%
50%
42%
45%
50% 49%
48%
50%
36%
32%
35%
28%
30%
25%
22%
20%
The projected Rx share of total medical costs for Accident Year 2014 is 17%
13%
15%
5%
47%
52% 51%
39%
40%
10%
45%
49%
51%
7%
Projected 2014 Accident Year Share
5%
0%
1
2
3
4
5
6
7
8
9 10 11 12 13
Claim Maturity in Years
14
15
16
NCCI analysis based on Medical Data Call, for prescriptions provided in Service Years 2011 to 2014.
Rx shares shown are the projected shares for Accident Year 2014. For example, we project that Rx will be 22% of
medical costs paid in 2017 for injuries that occurred in 2014. Data used with permission.
6
17
18
19
Cost = Price x Utilization



Cost—the total dollars paid per claim
Price—what is paid for individual services
Utilization—the intensity of services provided
per claim
 The number of units (tablets, capsules, etc.) of
Rx provided per claim
 The mix of Rxs provided on a claim, e.g.,
OxyContin versus Ibuprofen
7
Rx Costs per Active Claim
Continue to Grow
2011 to 2014 Cumulative Change is 25%
$500
$450
$400
$350
+7%
$379
$343
$406
+6%
$429
+10%
$300
$250
$200
$150
$100
$50
$0
2011
2012
2013
2014
Service Year
NCCI analysis based on Medical Data Call, for prescription drugs with a National Drug Code (NDC) provided in Service Years
2011 to 2014. Active Claim is a claim with at least one medical service during the service year. Data used with permission.
8
Rx Prices Increased 11% in 2014
Price Change
12%
Utilization Change
Rx Cost Change per Active Claim
11%
10%
10%
8%
% Change
6%
7%
6%
6%
6%
5%
4%
2%
1%
0%
-2%
-4%
-6%
-4%
2011–2012
2012–2013
2013–2014
Service Year
NCCI analysis based on Medical Data Call, for prescription drugs with an NDC provided in Service Years 2011 to 2014.
Price changes are based on a Fisher index. Data used with permission.
9
Rx Utilization Components
Mix of Drugs Prescribed
Share of Active Claims Receiving a Prescription
Prescriptions per Active Claim With at Least One Prescription
5%
6%
% Change
4%
2%
1%
1%
1%
0%
0%
0%
-2%
-1%
-2%
-4%
-4%
-6%
2011–2012
2012–2013
2013–2014
Service Year
Data used with permission.
10
2014 Rx Costs per Active Claim
Countrywide
$429
NCCI analysis based on Medical Data Call, for prescription drugs with an NDC provided in Service Year 2014.
High > $582 and Low < $202. Ranges are based on the arithmetic mean ± one standard deviation. Data used with permission.
11
Rx Cost Containment
Pharmacy Benefit Managers
Pharmacy Networks
Utilization Reviews
Drug Fee Schedules
Prescription Drug Monitoring Programs (PDMPs)
Drug Formularies and Treatment Guidelines
12
Closed Drug Formulary

A closed formulary is a list of drugs with an associated
reimbursement status

For example, for ODG (adopted by TX, OK, and in 2016 TN):
Status


Description
Y
Preauthorized for use
N
Not allowed, or needs authorization
*
Both Y and N are possible depending on intended purpose
On average, 24% of drug costs and 17% of prescriptions in a
service year are for N drugs
The intent of formularies is to use evidence-based guidelines in
order to:
 Reduce over prescribing (opioids in particular)
 Maximize healing and improve return-to-work outcomes
 Contain drug costs
The Official Disability Guidelines (ODG) Drug Formulary is a product of the Work Loss Data Institute.
13
Potential Rx Costs Savings From
ODG Formulary
NCCI analysis based on Medical Data Call, for prescription drugs with an NDC provided in Service Year 2014.
The Official Disability Guidelines (ODG) Drug Formulary is a product of the Work Loss Data Institute. Data used with permission.
14
Controlled Substances and
Physician Dispensing
Continue to Grow
All Other Rx
Controlled Substances
$500
$450
$379
$400
$350
$300
$250
$406
$343
+0%
+1%
$40
$40
$101
+3%
+5%
$107
$429
$44
+8%
$119
$110
+4%
$200
+10%
+15%
$150
$100
$41
+8%
$201
$232
$255
$265
2012
2013
2014
$50
$0
2011
Service Year
Controlled substances are Rxs classified as Schedule 2 and 3 by the Drug Enforcement Administration, not dispensed by
a physician. Physician dispensing includes controlled substances. Data used with permission.
16
2014 Change in Rx Costs per Active Claim
(Less than 0%)
Countrywide
+6%
17
States With a Decrease in
All Other Rx
$500
$460
$437
$134
$118
$71
$68
$255
$251
FL-2013
FL-2014
Rx Cost per Active Claim
$450
$400
$350
$268
$300
$250
$200
$150
$14
$203
$3
$78
$177
$3
$0
$8
$67
$67
$100
$50
$65
$253
$122
$108
OR-2013
OR-2014
$189
$178
AR-2013
AR-2014
NCCI analysis based on Medical Data Call, for prescription drugs with an NDC provided in Service Years 2013 and 2014.
18
States With an Increase in
All Other Rx
$600
$551
$474
$500
$44
$37
$383
$400
$300
$250
$217
$5
$6
$200
$84
$100
$0
$100
$296
$74
$177
$134
$126
$57
$57
$304
$127
$145
$165
MA-2013
MA-2014
IL-2013
$200
IL-2014
AZ-2013
19
$331
AZ-2014
Controlled Substances Prices Increased 16%
Price Change
Utilization Change
20%
16%
15%
% Change
10%
5%
8%
5%
4%
5%
3%
2%
0%
-2%
-5%
-7%
-10%
2011–2012
2012–2013
Service Year
2013–2014
NCCI analysis based on Medical Data Call, for controlled substances with an NDC provided in Service Years 2011 to 2014.
a physician. Price changes are based on a Fisher index. Data used with permission.
20
Utilization Components
Prescriptions per Active Claim Receiving at Least One Prescription
3%
2%
2%
2%
1%
1%
% Change
2%
0%
-1%
-2%
-1%
-2%
-3%
-3%
-4%
-5%
-6%
-4%
-5%
2011-2012
2012-2013
2013-2014
Service Year
NCCI analysis based on Medical Data Call, for controlled substances with an NDC provided in Service Years 2011 to 2014.
a physician. Data used with permission.
21
2014 Controlled Substances Share of Rx Costs
Countrywide
29%
NCCI analysis based on Medical Data Call, for controlled substances with an NDC provided in Service Year 2014.
Controlled substances are Rxs classified as Schedule 2 and 3 by the Drug Enforcement Administration. High > 35.0% and
Low < 22.5%. Ranges are based on the arithmetic mean ± one standard deviation. Data used with permission.
22
Physician-Dispensed Rx Utilization
Increased 4% in 2014
Price Change
Utilization Change
10%
8%
8%
% Change
6%
4%
4%
4%
2%
1%
1%
0%
4%
0%
0%
-2%
-4%
-6%
-4%
2011–2012
2012–2013
Service Year
NCCI analysis based on Medical Data Call, for physician-dispensed prescriptions with an NDC provided in
Service Years 2011 to 2014.
23
2013–2014
Mix of Rxs Is a Major Contributor to
Utilization for Physician Dispensing
Utilization Components
Prescriptions per Active Claim Receiving at Least One Prescription
12%
10%
10%
7%
8%
% Change
6%
4%
4%
2%
0%
0%
-2%
-4%
-6%
-8%
-4%
-5%
-7%
2011–2012
2012–2013
Service Year
NCCI analysis based on Medical Data Call, for physician-dispensed prescriptions with an NDC provided in
Service Years 2011 to 2014. Data used with permission.
24
-4%
-3%
2013–2014
2014 Physician-Dispensed Share of Rx Costs
(Medium)
Countrywide
10%
NCCI analysis based on Medical Data Call, for physician-dispensed prescriptions with an NDC provided in Service Year 2014.
High > 16.2% and Low < 1.7%. Ranges are based on the arithmetic mean ± one standard deviation. Data used with
permission.
25
Top Drugs in Workers
Compensation
Top Drugs by Cost
Brand
Name/
Generic
Therapeutic
Class
OXYCONTIN
Brand Name
Analgesics
1
1
6.2%
LYRICA
Brand Name
GABAPENTIN
Generic
CNS Drugs
CNS Drugs
2
4
2
3
5.5%
4.7%
OXYCODONEGeneric
ACETAMINOPHEN
Analgesics
9
4
3.8%
CELEBREX
Antiarthritics
6
5
3.4%
132
6
2.9%
24
7
2.9%
8
8
2.8%
7
14
9
10
2.7%
2.0%
Drug Name
Brand Name
DULOXETINE HCL Generic
Psychotherapeutic
LIDOCAINE
Generic
Anesthetics
MELOXICAM
Generic
Antiarthritics
HYDROCODONEGeneric
ACETAMINOPHEN
OXYCODONE HCL Generic
Analgesics
Analgesics
2013
Cost
Ranking
2014
Cost
Ranking
2014
Share of
Total Rx
Costs
•
DULOXETINE HCL is the generic formulation of Cymbalta. Cymbalta’s patent expired on
12/11/2013. Cymbalta’s rank changed from 3rd to 47th between 2013 and 2014.
•
LIDOCAINE is the generic formulation of Lidoderm. Lidoderm’s patent expired on
9/15/2013. Lidoderm’s rank changed from 5th to 34th between 2013 and 2014.
27
10 Drugs Explain More Than Half of
the 2014 Change in Prices
Drug Name
Brand
Name/
Generic
DEA
Schedule
2013 Price
Paid per
Unit*
2014 Price
Paid per
Unit
2014
Change in
Price Paid
per Unit
OXYCODONEACETAMINOPHEN
Generic
2
$1.19
$1.61
35%
LYRICA
Brand Name
5
$3.74
$4.54
21%
OXYCODONE HCL
Generic
2
$0.63
$1.01
60%
CELEBREX
Brand Name
None
$5.63
$6.92
23%
OXYCONTIN
Brand Name
2
$6.73
$7.27
8%
DUEXIS
Brand Name
None
$6.05
$10.40
72%
BACLOFEN
Generic
None
$0.65
$1.22
86%
PERCOCET
Brand Name
2
$7.15
$9.18
28%
MORPHINE
SULFATE ER
Generic
2
$2.35
$2.94
25%
IBUPROFEN
Generic
None
$0.30
$0.43
44%
*2013 price paid per unit based on 2014 NDC distribution. Data used with permission.
28
Generic Rx Utilization Increased 13% in 2014
Price Change
Utilization Change
25%
21%
20%
% Change
15%
12%
13%
12%
10%
8%
7%
7%
5%
0%
0%
-1%
-5%
2011–2012
2012–2013
Service Year
2013–2014
29
Brand Name Rx Utilization
Decreased 18% in 2014
Price Change
Utilization Change
20%
15%
% Change
10%
14%
12%
10%
9%
7%
5%
0%
-5%
-1%
-4%
-7%
-10%
-15%
-20%
2011–2012
2012–2013
Service Year
-18%
2013–2014
30
Generic Shares of Rx Costs and
Prescriptions Both Increased in 2014
Rx Costs
Prescriptions
100%
90%
Generic Share of Rx
82%
78%
77%
76%
80%
70%
60%
50%
51%
44%
45%
45%
40%
30%
20%
10%
0%
2011
2012
2013
Service Year
31
2014
3 Drugs Explain Most of the 2014 Change
in the Generic Share of Rx Costs
Drug Name
DULOXETINE HCL
2013
Price
Paid per
Unit
$5.47
2014
Price
Paid per
Unit
$5.70
2014
Change
in Price
Paid per
Unit
4%
Contribution
Recent Events
38%
The brand name
equivalent
formulation’s
(Cymbalta) patent
expired on
12/11/2013
LIDOCAINE
$6.08
$6.89
13%
27%
The brand name
equivalent
formulation’s
(Lidoderm) patent
expired on
9/15/2013
OXYCODONEACETAMINOPHEN
$0.92
$1.61
74%
20%
Price increased
32
Concluding Remarks
 Rx continue to be a significant share of WC costs,



largely due to increasing prices
Legislative reform and stakeholders’ concerted
efforts to contain costs have contributed to
dampened utilization of Rxs in WC
Will formularies, physician-dispensing laws, and
other reform efforts have the intended impact on
WC experience?
Choice of pharmacy and the role of PBMs and
PDMPs are some of the emerging themes in the
dynamic world of Rxs and WC
33
Appendix
NCCI Medical Data Call

The NCCI Medical Data Call (MDC) captures
transaction-level detail on medical bills processed
on or after July 1, 2010, including dates of
service, charges, payments, procedure codes,
and diagnosis codes

Carriers are not required to report transactions
for services provided more than 30 years after
the date of the injury

NCCI collects the MDC for 43 jurisdictions*
*The 43 jurisdictions are AK, AL, AR, AZ, CO, CT, DC, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN,
MO, MS, MT, NC, NE, NH, NJ, NM, NV, NY, OK, OR, RI, SC, SD, TN, UT, VA, VT, WI, and WV.
35
Data Source


For this study, the Medical Data Call experience
evaluated as of March 2015 was restricted to:

Services provided between January 1, 2011 and
December 31, 2014

States included are: AK, AL, AR, AZ, CO, CT, DC,
FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME,
MN, MO, MS, MT, NC, NE, NH, NJ, NM, NV, NY, OK,
OR, RI, SC, SD, TN, UT, VA, VT, and WI
State-specific results are based on state of jurisdiction
36

Workers Compensation and Prescription Drugs: 2016 Update

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