High Use Of Rx Drugs Like Vioxx Costing Comp

Among different varieties of drugs, the workers' comp system spent more on painkillers?54 percent–than any other type, the study found. Muscle relaxants accounted for 18 percent of payments for prescriptions, and antidepressants another 15 percent.

NCCI said that prescription drugs' share of comp medical costs rose from 10.1 percent in 1997 to 12.1 percent in 2002, but that between 1997 and 2001 "utilization had a greater impact on WC drug costs than price."

Companies might be focusing on expanded use of drugs, and "it will be interesting to see if this change is just a one-time occurrence or the beginning of a new trend," the report said.

Although from 2001 to 2002 drug price hikes slightly outpaced the impact of utilization on overall drug costs, "most knowledgeable observers agree that utilization is the more important driver of medical costs," the study authors wrote.

According to NCCI, the comp system is already prescribing generic drugs when available, so there is little opportunity for savings by increasing their usage.

Generic drugs as prescriptions, when they are available as a non-brand alternative, rose from 79 percent in 2001 to 86 percent in 2002, the survey found.

The top-10 prescribed drugs by total paid for them by workers' comp insurersfrom 1997 to 2002 were as follows:

? Celebrex-brand anti-inflammatory–7.6 percent.

? Oxycontin-brand pain killer–6.6 percent.

? Vioxx-brand anti-inflammatory–5.6 percent.

? Hydrocodone generic–5.4 percent

? Nerontin-brand painkiller–4.9 percent.

? Carisoprodol generic muscle relaxant–3.2 percent.

? Ultram-brand painkiller–2.9 percent.

? Cyclobenzaprine generic muscle relaxant–2.4 percent.

? Ambien-brand sedative–2.1 percent.

? Naproxen generic anti-inflammatory–2.1 percent.

Among its rankings, NCCI said the use of some prescriptions had recently soared–notably the Bextra-brand pain killer, which moved from number 1,852 to 19 on the list.

The study said that 28 states have put a drug reimbursement schedule in place to control costs using average wholesale price as a mechanism for reimbursement.

Barry Llewellyn, one of the report authors said he had expected to find the medical cost share represented by drugs had increased, but was surprised to find that so many states had fee schedules, but the more important finding, he said was that states "all use average wholesale price, which is a creation of the drug manufacturers."

"AWP, he noted "is not subject to any regulatory review- it's ?this is what we would like to get for our drugs. It's similar to what car manufacturers put on as a sticker price."

"If policymakers think they have done something to control medical costs from drugs, the use of average wholesale price in the formula for putting limits is not going to do much to hold costs in line.

Some states have a higher dispensing fee for generics, while nine states reimburse up to a level above the average wholesale price in a range from 4 percent to 40 percent, the study found. Eleven states reimburse up to the average wholesale price level, and eight states reimburse up to a level that five-to-15 percent below it.

NCCI noted that the Workers' Compensation Insurance Rating Bureau in California estimates that recent reform legislation there–which includes mandatory generic substitution and a revised pharmacy fee schedule–should create cost savings of 1 percent of total workers' comp costs to save $249 million.