The complex landscape surrounding high-impact drugs & workers' comp
Drugs such as topicals and combo packs see low utilization, but carry exponentially higher costs.
When we talk about addressing pharmacy issues in workers’ compensation programs, opioid concerns often appear at the top of the agenda, and while opioid management remains an important focus, it is not the only pharmacy trend we must watch closely.
High-impact categories such as topicals, compound kits, combo packs, and specialty medications represent proportionately low utilization, however, they can be associated with exponentially higher costs. In order to effectively manage clinically appropriate utilization and savings within these classes, it is important to recognize the trends associated with each of these cost drivers.
Over the last several years, the industry has seen the utilization of topical medications, which are applied to the skin or mucous membranes, climb. These drugs now represent a leader in spend and a growing source of concern in the workers’ compensation space. The category seems to be the next horizon for billers and dispensers, especially physician dispensers, to turn to as a money‑making opportunity and stands out as a continuing trend.
Topicals are being prescribed in workers’ comp with growing frequency — ranking third among the top therapeutic classes at 12.4% of total drug cost and 5.7% of total prescriptions. Within this class, there are some cost drivers that stand out, such as private‑label topical analgesics (PLTAs), which are associated with limited clinical efficacy and exorbitant pricing that often eliminates them as a favorable first‑line therapy option. Examples include Velma, Lidopro, and New Terocin.
Also, within the topical and dermatologic category, are prescription topical medications including non‑steroidal anti‑inflammatory drug (NSAID) products like Voltaren Gel and Pennsaid as well as some topical anesthetics such as ZTLido and Lidoderm, and these carry specific, limited Food and Drug Administration (FDA) approval for use that should be considered along with appropriate place and therapy.
Conversely, PLTAs are not approved by the FDA and are not evaluated for compliance with applicable regulations and policies pertaining to safe and effective use. These products are also not recommended as first‑line therapy.
In addition, they seldom offer greater clinical benefit versus more cost‑effective, comparable over‑the‑counter (OTC) alternatives, and often contain the same ingredients. Creating further challenges, most of these products are marketed directly to physicians’ offices for dispensing, creating paper bills and out‑of‑network concerns regarding cost management and bypassing safety and clinical controls.
While topical medications can present several benefits and may be a viable option for select patients, they require careful oversight. In many cases, their lack of demonstrated superiority, effectiveness, and price impacts support the argument for consideration of therapeutic ingredient equivalents, which produce lower costs and/or clinically efficacious outcomes.
Combo packs’ high price tag
We are also seeing high-dollar compound kits and combo packs whose individual components are available separately or in different formulations at a much lower cost. Compound kits contain two or more premeasured drug ingredients that must be combined immediately prior to use based on a prescription order and are sold together as one product, generally under one national drug code (NDC). Combo packs consist of multiple commercially available products that are conveniently packaged together for sale with a common therapeutic purpose.
One example that illustrates the extreme price markup for combo pack products involves an OTC topical gel combined with alcohol wipes packaged as one product. When dispensed separately, they carry an average wholesale price (AWP) of about $15 combined. However, as a combo pack product co‑packaged under one NDC, the price for these same products now represents an AWP around $3,400.
Fortunately, we are seeing declining trends within the combo pack category, due in part to the implementation of various programs and controls used to specifically address them. Unfortunately, the inflated cost associated with these products, which average about $2,100 per prescription, speaks to the importance of a continued focus on this area and the impacts it can have.
Similar to some of the other categories discussed is the specialty drug category, which includes medications that are typically used to treat complex, chronic conditions, and represent a major area of pharmaceutical development with significant costs.
Specialty drugs
There is no universal list of specialty drugs to easily identify this group of relatively low-volume, high-cost medications. Most entities establish their own definition of what should be included within the category, which generally comprises some combination of criteria involving drugs used to treat rare complex conditions, considerations for special storage and handling requirements, cost, and various clinical applications for use, such as administration challenges, patient adherence, specific testing and monitoring requirements, and patient safety and immunogenicity concerns.
Given this, the specialty category includes a broader definition of products that fall into this criterion set, as well as biologics and biosimilars defined by the FDA to include vaccines, viruses, therapeutic serums, toxins, blood or its derivatives, allergenic products, and others. In workers’ compensation, for example, the specialty category often represents injectables used to manage inflammatory conditions or various types of joint pain.
In addition, for workers’ compensation, specialty drugs can be especially challenging as they’re prescribed to treat conditions that may either directly or even indirectly be related to workplace injuries or illnesses. The various distribution channels also pose additional concerns, with about half of these medications dispensed in doctors’ offices, clinics and hospitals, as opposed to traditional pharmacies. Additionally, many of these products are billed using J codes.
Even though many of these drugs are prescribed to manage complex, often chronic conditions, some notable disease states are trending within the workers’ compensation space. The five top disease states represent over 60% of all specialty drug costs and utilization. The majority serve as blood clotting treatment and prevention medications, including medications that prevent and treat deep vein thrombosis and pulmonary embolism such as Eliquis or Xarelto. Other disease state categories in the top five were driven by medications used to treat HIV or AIDS, primarily antiviral drugs, which are currently used for post‑exposure prophylaxis following a needlestick injury. Cancer drugs, autoimmune‑related disorders, and migraine medications, including newer injectables within the therapeutic class — such as Ajovy, Emgality and Aimovig — rounded out the top five conditions.
While high costs and other challenges remain a concern, specialty drugs including biologics and biosimilars should be continually evaluated for potential benefits to injured workers, as they may provide relief that traditional therapies cannot, which could potentially result in a better quality of life as well as fewer hospital admissions, emergency room visits and laboratory tests. However, in other cases less expensive but equally effective alternative therapies might offer a better choice.
Targeted solutions for pharmaceutical challenges
When it comes to addressing these high-impact pharmaceutical challenges, the best approach is to deploy targeted clinical solutions that leverage three strategies to drive pharmacy program optimization.
First, identification of these challenging high-impact pharmaceutical categories is key, as they are not readily identifiable within the data. In addition, a pharmacy program should include proactive solution options for post‑dispense review, plan edits, drug list control or formulary management, as well as medication prior authorization decision support that includes both clinical and regulatory that reinforce utilization management and billing controls.
Second, follow the evidence. Enforce clinical controls that target these categories and scenarios for interventions to promote first‑line, more cost‑effective alternatives through clinical review and timely recommendations, drug utilization assessments and formal utilization review. Build these categories into predictive and demonstrative risk modeling to establish clinical solutions that address patient safety, align with evidence‑based recommendations for treatment, and enforce various treatment guidelines such as the Official Disability Guidelines (ODG). Follow this up by promoting ongoing clinician engagement, oversight, education and coordination.
Finally, use reporting tools and data analytics to continually improve collaboration with clients through education, support, and partnership review to address areas of opportunity.
Nikki Wilson, Pharm.D./MBA, is senior director, clinical pharmacy services, at Mitchell, an Enlyte Company. As a licensed pharmacist, Wilson has over 13 years of comprehensive industry experience through leadership roles overseeing prescription home delivery programs, clinical pharmacy operations and benefits management, and product development.
Opinions expressed here are the author’s own.
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