The misuse and abuse of prescription drugs has taken a devastating toll on communities all across America. For insurance companies, the financial impact of rising opioid costs continues to cause concerns, as medical payments exceed indemnity payments.

In 1987, medical losses represented only 46 percent of the dollars spent on workers' compensation claims. Today, medical losses represent roughly 60 percent of the dollars spent on these claims.[i] In the Winter edition of the NAMIC Mutual Insurance magazine, the article “Opioids: A Workers’ Compensation Epidemic" discussed the Accident Fund Insurance’s 60%/40% medical loss/indemnity loss split, in addition to calling opioids workers’ compensation’s current worst enemy.[ii]

With approximately 20 percent of all medical spending going towards prescription drugs, workers' compensation, insurers have been working hard to mitigate these costs. Insurers have negotiated discounts with preferred providers, established comprehensive prescription drug networks, used advanced analytics to identify the most severe claims, promoted evidence-based pain diagnoses, leveraged utilization reviews, and invested in tort reform. All of these measures have been taken with the goal of reducing injured worker reliance on addictive prescriptions drugs and helping workers return to work sooner.