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Overall workers compensation medical payments have continued to decline, according to the Workers Compensation Insurance Rating Bureau of California’s statewide Workers Compensation Aggregate Medical Payment Trends report, the bureau announced Tuesday.
The report compares medical payment information from 2016 to 2018 and also analyzes utilization and cost of opioid prescriptions over time and by region.
Medical payments for pharmaceuticals and to pharmaceutical providers declined sharply in 2018, the first year after the state’s adoption of an evidence-based drug formulary in the workers compensation system. In October 2016, Gov. Jerry Brown signed a bill that linked the state’s Division of Workers Compensation’s drug formulary to the California Medical Treatment Utilization Schedule. The change took effect Jan. 1, 2018.
In the first full year after the formulary took effect, use of opioids, physician-dispensed drugs and brand name drugs with generic alternatives also dropped sharply, according to the study. Prescription drugs not subject to utilization review in accordance with the formulary increased 41%, but drugs subject to UR declined by 18%. The use of brand name drugs with generic alternatives dropped from 13% in early 2017 to 6% in the fourth quarter of 2018, and the share of pharmaceutical payments between the first quarter of 2017 to the last quarter of 2018 decreased for 7.5% for opioids and 7% for physician-dispensed drugs, the report revealed.
The state’s injured workers received about 870,000 prescription drugs in 2018, down from 1.3 million in 2017, with prescriptions per claim down 29% from 2017 to 2018, and pharmaceutical cost per claim down 32% over the same time period.
Despite a substantial increase in the share of drugs not subject to UR, the drugs incurred only a 13% higher share of the cost in 2018 compared with 2017, according to the report.
The report also noted that physical therapy services experienced the largest increase in the share of medical payments, rising to 8.9% in 2018 from 6.7% of total medical payments in 2017, driven by increases in both service utilization and paid per service.
In the state, the use of anticonvulsants increased more significantly than any other therapeutic groups, with a 1.46% change in medical payment share over the prior year.
Pharmacy costs in workers compensation have decreased by $1.1 billion during the past eight years as the result of fewer opioid prescriptions, among other reasons, according to a study released Wednesday by Maggie Valley, North Carolina-based CompPharma L.L.C.