In this economic downturn, workers' compensation insurers arestruggling to contain costs and remain profitable while continuingto provide quality care to injured parties. As payers investigatevarious cost-containment measures, many are reviewing pharmacyexpenses, which account for seven to 12 percent of total workers'compensation costs, according to a recent study by the Workers'Compensation Research Institute.

Managing pharmacy costs is especially challenging with long-termclaims. According to a recent study on workers' compensationindustry prescription drug spending, prescription drugs typicallyamount to only three percent of medical costs in a claim during thefirst year. After seven years, however, these costs can account foralmost 31 percent of overall drug costs, with drug spending alonepotentially averaging $27,000 annually (Source: 2007 NationalCouncil on Compensation Insurance report).

One strategy for reducing pharmacy expenses may be to conduct anin-depth clinical review of claims with a history of utilizationissues. This allows clinical professionals to identifyinappropriate utilization, which typically results in overspendingof up to 15 percent per claim. This strategy also helps monitor forproblematic drug-to-drug interactions and allergies to ensure thesafety of injured parties.

Leveraging Utilization Programs

Drug costs associated with workers' compensation claims can bedecreased using a variety of methods. However, savings areirrelevant if the medication should not have been dispensed in thefirst place. By putting a drug utilization review (DUR) programinto place, insurers could receive significant incremental savings-- usually between 10 to 15 percent above prescription costsavings, according to a recent internal audit of ProgressiveMedical clients.

There are several different types of drug utilization reviews,including prospective, concurrent and retrospective:

• A prospective DUR processallows all involved parties to prepare for future outcomes withup-front information and planning. Clinicians are involved indevelopment of plans and processes to assist with outcomes, thusreducing the need for claims professional intervention on everycase.
• Concurrent DUR typicallyoccurs in real-time at the pharmacy. When an injured party from aworkers' compensation claim fills a prescription, it is audited forappropriateness, duplication, multiple physicians, excessivedosage, drug-to-drug interactions, and other similar criteria.
• A retrospective DUR processtakes place after medications are filled. Using historical data,clinical experts can look for appropriate medication usage,potential drug-to-drug or drug-to--disease interactions, therapyduplication, and over-utilization by the injured party.

Additionally, formulary management involves taking steps toensure that the medication filled is specific to the work-relatedinjury claimed. For workers' compensation payers, it is imperativeto address the nature and expected duration of the injury whendetermining which medication is appropriate for treatment.

A DUR program should provide the payer with accurate reportingand recommendations to improve appropriate drug usage and qualityof care for the injured parties. This may include recommendationsfor alternative or amended drug therapy, uncovering medication planinconsistencies, and suggestions for restricting an injured partyto treatment with only one physician or a small team ofphysicians.

Additional Savings

With the costs of medications for workers' compensation claimsrising, it may be valuable to have prescriptions reviewed by apharmacist, physician or both. Obtaining clinical reviews can helppayers identify potential usage issues, drug-to-drug interactions,drug allergy complications, and compliance with stateregulations.

When incorporated into a drug utilization program, clinicalreviews can help ensure appropriate usage of drugs, enable payersto proactively plan for future medication needs, and ultimatelyreduce total pharmacy costs per claim, potentially by tens ofthousands of dollars.

Typically, there are three types of claims best suited for aclinical review:

• Claims with excessive medications
• Claims more than three years old
• Claims pending litigation and/orsettlement

A clinical review can also identify other red flags such as:

• Multiple physicians
• Multiple pharmacies
• Generic availability within currenttherapy
• Causal relationship to compensableconditions
• Duplication of therapy
• Excessive duration or length of medicationuse
• Appropriate medication doses and refillintervals

Improving Treatment

Injured parties also benefit when doctors and pharmacists reviewtheir claims because of their expertise in improving therapeuticoutcomes. Changes in drug therapy should be based on evidence-basedclinical guidelines, peer-reviewed medical journals, professionalexperience, and state regulatory guide requirements.

Here's an example of how a clinical review works: A womansuffered a right-elbow injury on the job and filed a workers'compensation claim. After undergoing multiple surgeries, she stillhad chronic pain in her elbow and shoulder as well as limited elbowmovement. She required five medications that caused subsequentconditions of depression and anxiety.

After a comprehensive review of the injured party's medicalrecords and prescription history by a clinical pharmacist, it wasdetermined that the individual was inappropriately being treatedfor insomnia. The clinical pharmacist and physician recommended theelimination of a drug from her regimen and that she might benefitfrom being treated for insomnia and depression with non-drugtherapy. As a result, by reducing a medication and incorporatingnon-pharmacologic therapy, the insurer reduced its annual costsignificantly for this injured party.

Summary

Today's economic conditions continue to bring challenges toinsurers and to drive them to look for ways to reduce costs whilemaintaining quality clinical outcomes for their injured parties.More than four million workers are injured on the job each year,according to U.S. Bureau of Labor Statistics, making thesecost-containment efforts critical. One approach to contain pharmacyexpenses is to get more control of claims with over- orunder-utilization issues. Engaging in a comprehensive DUR programthat includes in-depth clinical review can result in significantcost savings. This approach also ensures that injured partiesreceive appropriate medications to help them get back to work morequickly.

Tron Emptage, RPh, MA, is executive vice presidentof business development at Progressive Medical, Inc. He overseesthe clinical services department, which provides drug formularydesign and management, clinical review by a pharmacist and/orphysician, drug utilization review, and Ask-a-Pharmacist and Ask aPMI Nurse call-in hotlines for pharmacy-related questions. He maybe reached at [email protected]or 800-777-3574.