One of the biggest barriers to settling a long-term claim is the fear of running out of money. Injured workers are often reluctant to finalize a claim because they don’t think they’ll have enough money for all their needs — especially for their future medical treatments.
But a growing trend in the workers’ compensation system addresses that concern. It happens when a professional administrator becomes involved and can accurately demonstrate real-time savings for prescription drug costs, rather than suggesting a vague range of prices. In fact, plaintiff’s attorneys are even warming up to the idea.
Transparent Drug Prices
Pricing out prescription savings is becoming a key tactic to settling workers’ compensation claims. Here’s how it works:
- A Medicare Set-Aside or medical cost projection is offered as part of an overall settlement for the injured worker.
- A professional administrator determines the discounted price of each prescription the injured worker is taking. While the costs are based on today’s current rates, they can sometimes be locked in for a period of time.
- The injured worker sees the actual discounted pricing of his medications during the settlement process.
The professional can determine its discounted prices of prescriptions with the National Drug Code, a list of medications the injured worker is taking, and any recent MSAs and care plans within the past year. Some professional administrators are able to offer drug prices that are 40 percent below the price the injured worker would otherwise pay.
Consider this example:
- An injured worker’s MSA projected lifetime prescription cost is $100,000.
- During the settlement process the professional administrator is able to show the injured worker that, through its platform, the injured worker’s drug prices would actually be $40,000, providing the injured worker with the extra $60,000 for any needed surgeries, or to leave to his heirs.
- Working with a credible professional administrator ensures the injured worker remains compliant with Medicare guidelines. In the rare event that the worker exhausts his funds, Medicare would become the primary payer going forward.
Getting long-term workers’ compensation claims off the books is often an elusive goal, due to the fears and concerns of injured workers. Providing real-time, transparent prices for current medications is a strategy that is increasingly leading more injured workers to settlement agreements.
Attorneys for injured workers are also becoming savvy to the idea. They say it is much easier to approach their clients about settlements when they can see substantial savings.
What makes the idea compelling is that it shows the injured worker exactly what he would be paying for his medications if he was working with the professional administrator. Many injured workers are frustrated, overwhelmed and confused about how much money they will need going forward. While they may not like dealing with the workers’ compensation system, they find some comfort knowing that at least most of their medical needs will be met and someone is there to help them navigate the system.
An appropriately developed settlement with a professional administrator involved can address both needs. The worker gets the money he needs — spelled out in a clear, concise manner, and the professional administrator guides him through the process going forward. In addition to medication costs, some professional administrators also have discounts for home healthcare, skilled facilities, and durable medical equipment services.
Using a professional administrator as part of the settlement process provides a level of comfort for all participants, and helps ensure the injured worker will have enough money for the rest of his life.
Author Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%. He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center.
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