Cost Controls Keep Insurers Healthy

Careful monitoring, negotiated prices and drug benefits managerall help

A spoonful of sugar might make your medicine go down easier, butit takes more than that to keep the cost of medicine down.

The annual study of the top drugs in workers' compensation byThe Hartford Financial Services Group and Specialty Risk Servicesshows drug costs rising by only 6 percent in 2004. That's abouthalf the rate of pharmacy inflation and is down from 13 percent in2003.

Improvements like this don't happen by chance. Newer, moreexpensive drugs continue to exert upward pressure on pharmacycosts, so workers' comp insurers and claims administrators have tobe vigilant to make sure claimants get just the drugs they need forgood treatment.

Again at the top of the list is OxyContin, a powerfultimed-release narcotic used for moderate-to-severe pain. OxyContinis designed for long-term use and frequently is appropriate forpatients with certain workers' comp injuries.

Unfortunately, though, the drug's potent narcotic effects andits high street value provide a big potential for diversion. TheFood and Drug Administration, the U.S. Drug EnforcementAdministration and OxyContin's manufacturer–Perdue Pharma–have beenworking together to try to curb its abuse. We do our part byremaining vigilant to indications that the drug is not being usedas intended.

Not surprisingly, drugs to control pain dominate the list,accounting for 20 of the top 25. They break down into fourgroups–non-steroidal anti-inflammatory drugs (NAIADS); short-actingnarcotics; long-acting narcotics; and drugs to support or augmentpain relief. The list also includes anti-depressants such asZoloft, sleeping pills such as Ambien, and muscle relaxants such asSkelaxin.

Pain management is a complex matter. With so many drugsavailable, I worry that some physicians subscribe to a “newer isbetter” philosophy, routinely putting patients on new and trendydrugs when more established medications may have a lower risk andlower cost.

A case in point is the COX-2 inhibitors like Celebrex (numberthree on the list), Vioxx (number seven despite being withdrawnfrom the market in September) and Bextra (number six). The FDA'srecalls and warnings for these newer drugs suggests more changesmay be coming, and early 2005 data shows a drop-off in prescribingpatterns for the COX-2 drugs. Aspirin and Ibuprofen are two of theolder, non-steroidal medications often successfully used to treatmany of the same conditions as the COX-2 inhibitors, and this mayboost their use.

Oxycodone, a short-acting narcotic, is new to the list this yearat number 17. Also new are Mobic (number 24) and Endocet (number25)–both non-steroidal anti-inflammatory drugs. Although not yet onthe top-25 list, we're watching Palinode–a newly available,sustained-release version of Hydrocodone that may replace OxyContinto some degree in the future.

Our list of the top-25 drugs prescribed for workers' comp in2004 indicates that significant off-label drug use continues,despite widespread negative publicity. Off-label involves the useof drugs in ways not approved by the FDA.

One such drug is Actiq–a powerful painkiller approved by the FDAfor cancer patients with breakthrough pain. Actiq jumped fromnumber 15 in 2003 to number nine in 2004. The increasing number ofpatients receiving this drug and the increasing number ofprescriptions those patients are receiving strongly suggests it isbeing used for a much wider range of pain than the FDA intended.The narcotic is administered in a lollipop or lozenge and takesjust minutes to enter the bloodstream, giving it a high potentialfor diversion and abuse.

Another drug, Neurontin, remained at number two on the list in2004–although its manufacturer, Pfizer, paid more than $430 millionto settle state and federal charges relating to the drug'spromotion and marketing to physicians for non-FDA approveduses.

The drug–originally launched by Warner-Lambert, which Pfizerlater acquired–is approved by the FDA only to treat seizures inepilepsy and pain following shingles outbreaks (post-herpeticneuralgia). These conditions are relatively infrequent in workers'comp, but its numbers suggest considerable off-label use of thedrug.

While the cost of prescription drugs continues to rise, TheHartford has kept its pharmaceutical inflation rate down throughcontinuous cost management efforts–including careful monitoring,negotiated prices and other controls, as well as the use of apharmacy benefits manager.

One important factor in controlling costs is our proprietarylists of drugs commonly used to treat certain workers' comp-relatedmedical conditions. When we receive a request for a drug that isnot on our list, we refer the request to a nurse for clinicalreview to determine whether the requested drug actually is relatedto the injury.

There are times when an unusual drug may be appropriate. Often,though, the drug is for a medical condition not associated with theworkers' comp claim but which the pharmacy erroneously processedunder the workers' comp account.

Additionally, when refill patterns for certain drugs areexcessive, our case review may turn up indications of misuse,including fraud, drug diversion and addiction.

Every injured worker deserves the good care and appropriatemedicine to treat their injury. Our vigilance in monitoring thedrugs used in workers' care helps ensure they get it. We think Ms.Poppins would be pleased.

Robert E. Bonner, MD and Master of Public Health, is medicaldirector for The Hartford Financial Services Group Inc.

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Head: The Hartford's Top 25 WC Drugs

Drugs to control pain dominate the list, accounting for 20 ofthe top 25. Significant 'off-label' use of drugs in ways notapproved by the FDA is a key cost driver, The Hartford says.

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Doctors often prescribe expensive drugs in unapproved ways whencheaper alternatives are available, sending workers' comp billssoaring unnecessarily.

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“I worry that some physicians subscribe to a 'newer is better'philosophy, routinely putting patients on new and trendy drugs whenmore established medications may have a lower risk and lowercost.”

Dr. Robert E. Bonner