State legislators have proposed and conditionally approved amodel law that would tie reimbursement rates for prepackaged drugsdispensed by physicians for worker's compensation patients to theoriginal manufacturer's average wholesale price.

A panel of the National Conference of Insurance Legislators(NCOIL) approved the proposed model at its spring meeting inWashington Saturday.

Some interested parties said the cost of prepackaged drugs couldrange from 10 percent to 90 percent above the cost of buying thedrugs at a pharmacy. One speaker noted, “Is the convenience worththe cost?”

Rep. Bill Botzow, D-Vt., who chaired the workers' compensationcommittee meeting, said his panel approved the model contingent onamendments that will be introduced at NCOIL's July meeting.

The model law itself is based on Tennessee's approach, but NCOILwants to incorporate best practices used by other states throughthe planned amendments.

Rita Nowak, vice president, commercial lines and workerscompensation for the Property Casualty Insurers Association ofAmerica, said, “Let's base what we do on what really works.”

Eric Goldberg, an assistant vice president at the AmericanInsurance Association, said prepackaged drugs are part of thehealth-cost issue that is a primary driver of the rising costs ofproviding workers' compensation insurance. He welcomed approval ofthe proposed model as an important step.

An allied issue discussed at the NCOIL meeting is how can NCOILjoin in the effort to control, through a possible model law, thepotential for abuse of opioid drugs that are dispensed to patientsbeing treated through workers' compensation.

Other issues taken up at the meeting included proposals formodel laws establishing a definition “public employment”communities could use for determining which members of volunteerfire organizations would be eligible for workers' compensationbenefits if injured while not directly involved in an emergencyresponse.

The model is based on provisions in Vermont law and includes adrafting note identifying various state approaches to fundvolunteer firefighter coverage.

The panel also took up the issue of how to provide someuniformity to providing workers' comp coverage to agriculturalmigrant workers.