Prescription drug costs for workers' comp claims drop significantly
Only Louisiana, Pennsylvania, Delaware and New York logged prescription-price increases over WCRI's study period.
Prescription drug payments for workers’ compensation claims are mostly down, according to a recent study from the Workers’ Compensation Research Institute (WCRI).
The report, which included data from 28 U.S. states, showed prescription payments made per medical claim between the first quarters of 2021 and 2023 have fallen “significantly,” including a drop of at least 10% in 16 of the study states.
Only four states notched increases during the study period with Louisiana posting a 22% increase, Pennsylvania 16%, Delaware 10% and New York 8%.
“Per-claim payments for prescriptions were highest in Louisiana and Pennsylvania at about $1, 000, which is over 10 times more than states with the lowest per-claim payments like California and Massachusetts,” WCRI Policy Analyst Dr. Vennela Thumula told PropertyCasualty360.com.
“Louisiana had the highest per-claim payments for opioids and antidepressants, and the second highest for NSAIDs, dermatological agents, musculoskeletal therapy agents, and anticonvulsants,” she said. “Meanwhile, Pennsylvania had the highest per-claim payments for dermatological agents, anticonvulsants, and musculoskeletal therapy agents.”
While the WCRI study did not break down payments per industry, Thumula said: “Previously observed differences in prescription utilization across industries. For instance, the rate of opioid use was higher in the construction industry.”
Despite higher payment totals in such states as Louisiana and Pennsylvania, the WCRI report also highlighted a larger trend in falling claims. According to the study, quarterly prescription payments per medical claim plummeted 20% between the first quarters of 2018 and 2023.
Thumula said increased attention on prescription-drug use, especially opioids, within the workers’ compensation industry led to new regulations and policies for controlling the utilization and reimbursement of prescription drugs.
“In South Carolina, for example, we observed that prescription drug payments decreased after the state updated their reimbursement rules for topical medications,” she said. “Payments for anticonvulsants decreased because generics became available for Lyrica. Payments in Massachusetts decreased due to efforts to enforce the pharmacy fee schedule, which is lower than in other states.”
Additionally, there have been fewer claims with prescription drugs paid by workers’ compensation insurance in recent years, potentially indicating shifts toward prescriptions paid by non-workers’ compensation payers, cash payments, claims becoming less severe over time, or barriers to receiving prescriptions.
According to AmTrust Financial, prescription drugs now account for roughly 14% of a workers’ compensation claim, with the cost directly related to the medication’s price and utilization.
The WCRI study used data from 28 U.S. states including Arkansas, California, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Nevada, New Jersey, New Mexico, New York, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, and Wisconsin.
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