Every risk manager is aware of the financial impact the escalating cost of medications, especially narcotics, has had on the overall cost of workers’ compensation. While employers know the cost of narcotics are having a devastating effect on their financing of workers’ compensation, very few employers track their claims data in enough detail to state what percentage of their worker’s compensation claims money is paid for narcotics, or even what dollar amount they have paid over the prior fiscal year for narcotics.
Average Lost Time Claim With Long-Acting Opioid 900% Higher Than Without
The New York Times published an article entitled “The Soaring Cost Of the Opioid Economy”. While the article did not address the cost within any particular company, the information in the article can be utilized by risk managers to get a better understanding of the cost of narcotics.
It is estimated that in the year 2000, employers in the United States spent $800 million on drug screen testing. In the year 2013, it is estimated that U.S. employers will spend $2 billion on drug screening. This is an increase of 250%.
The cost of workers’ compensation claims sky rocket when injured employees start using narcotics. The average lost time work comp claim in the U.S. without the use of opioids cost $13,000. When an employee is prescribed a short-acting opioid like Percocet, the average lost time claim cost triples to $39,000. When an employee is prescribed a long-acting opioid like oxycontin, the average lost time claim costs explodes to $117,000, an increase of 900% over the average lost time work comp claim without the use of any opioids.
Highly Addictive Drug Use & Overdose Deaths Have Seen Sharp Increase
Opioids are highly addictive. This usually results in a change of motivation within the injured employee. The employee’s focus of recovery from the injury is replaced with a focus on obtaining more of the opioid. The long term use of opioids results in a sub-conscious (or sometimes even a conscious) desire not to recover from the injury and stay off work to use the opioid.
Opioid addiction is treated with……additional drugs, buprenorphine and naltrexone. The cost of getting addicted employees off of opioids adds to the overall cost of the workers’ compensation claim. The use of buprenorphine and naltrexone has risen from near zero prescriptions in 2002 to nearly 8 million prescriptions in 2012.
Narcotics as a percentage of all prescriptions written for workers’ compensation claims increased 63% from 2001 to 2008.
Opioid overdose deaths have risen sharply along with the cost. In 1999, there were 4,030 deaths due to opioid overdose. By 2010, that number had more than quadrupled to 16,651.
The doctors prescribing opioids know the risk associated with addiction and the cost involved. In approximately 20 states where a doctor can both prescribe a drug and sell the drug to the injured employee, the overall claim cost is even higher. The New York Times article used Illinois and Connecticut 2011 data for example. A single pill of Vicodin in Illinois cost an average of 53 cents at a pharmacy, but when sold by the same doctor prescribing the pill, the Vicodin pill sold for $1.44. The spread was even greater in Connecticut, where the single Vicodin pill sold by pharmacies averaged 37 cents, but $1.43 when sold by the doctor prescribing the pill.
Prescription Monitoring & Nurse Case Managers Can Combat Problem
When doctors do cut off the flow of opioids prescriptions to injured employees, the addicted employee often will find a reason to no longer accept the judgment of the doctor and will request a different doctor. Fortunately, states have gotten wise to the practice of “doctor shopping”. Currently, 46 states have databases of prescriptions to stop employees from obtaining excess opioids. Georgia, Maryland and New Hampshire are in the process of setting up their prescription monitoring programs. That will leave only the District of Columbia and Missouri without a prescription monitoring program.
There is something an employer can do about the run-away cost of narcotics. If you do not have a nurse case manager assigned to all of your lost time claims, the issuance of a prescription to the injured employee for any narcotic should be an automatic trigger to assign the nurse case manager. If a nurse case manager is already assigned to the claim, the nurse should discuss with the treating doctor the use of short-acting opioids rather than long-acting opioids. Careful monitoring of opioid use by both the pharmacy benefit management company and the nurse case manager is essential to holding down the cost of the claim and preventing opioid addiction.
If you need assistance in selecting a pharmacy benefit manager or a medical management company for nurse case managers, please contact us.
Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:RShafer@ReduceYourWorkersComp.com.
Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com. Contact: mstack@reduceyourworkerscomp.com.
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