Increasing use of generic drugs has led to the first annual overall decrease in workers' compensation pharmaceutical costs, according to a survey from The Hartford.
This dip, based on the company's research data, is linked in part to the greater availability of generic substitutes, especially for the most popular and expensive name-brand drugs.
The Hartford survey is the second recent research finding of its kind. Last month the NCCI reported that acceleration of comp prescription drug costs was showing signs of moderating and in 2004, their most recent year for data, the rate of increase was 8.2 percent, down two points from 2003 when the rate was 10.2 percent.
While The Hartford had been reporting progressively smaller annual increases since the first study was published in 2001, this past year marked the first time ever that costs actually declined slightly–by about 1 percent.
“Still, we shouldn't presume this decline is the beginning of a trend, especially as more drugs are being prescribed and overall pricing continues to rise,” said Dr. Robert Bonner, The Hartford medical director.
Increased use of generic substitutes for OxyContin and Neurontin, two of the more expensive and widely used drugs for treating pain in workers' compensation cases, is having a significant effect on pharmaceutical costs, Dr. Bonner said.
Also, withdrawal of the popular Cox-2 inhibitors Bextra and Vioxx, which were frequently taken to manage pain and inflammation, is helping to drive down pharmacy costs, he added.
But overall increasing use of drugs could contain cost-cutting efforts.
For example, while use of OxyContin declined, it was more than offset by adoption of its generic version, Oxycodone, which costs less than half the price of the brand-name. “In fact, total consumption of this potent pain-killer in original or generic form increased by 6 percent,” Dr. Bonner said.
Neurontin, last year's second-highest ranked drug, was pushed to number 20, replaced in the second spot by its generic version, Gabapentin, which wasn't even on the list in 2004. Gabapentin is priced approximately 35 percent lower than Neurontin.
Still, over the course of just one year, The Hartford observed a 25 percent price per-pill increase for both versions of this medicine.
According to NCCI, the Centers for Medicare and Medicaid Services, in examining a reduction in prescription drug costs to their system, found:
o Increased over-the-counter use of antiulcerants and antihistamines.
o A shift toward dispensing more drugs through mail-order systems.
o A reduction in the use of some non-generic prescription drugs because of safety concerns–notably increased risk of heart attack and stroke from anti-inflammatory medicines Celebrex, Vioxx and Bextra.
According to experts in the field, however, drug costs for comp claims are difficult to reduce because the work force has an expanding population of older workers who typically use more medication after an injury.
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