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Pegged as a problem by the workers compensation industry nearly a decade ago, dermatological creams are increasingly being prescribed at a disproportionate cost to manage soft-tissue injuries, according to a recent study.
In California, dermatological creams are in the so-called category of “low-volume/high-cost” drugs and represented the fourth-most prevalent drug category in 2021, accounting for 9.3% of workers comp prescriptions but 17.3% of all prescription drug payments, up from 12.8% in 2012, according to the report released May 22 by the California Workers’ Compensation Institute.
“These have been a cost driver in the California workers compensation system for some time,” said Alex Swedlow, CWCI’s president based in Oakland, California. “And there have been a variety of strategies used to try to curtail unnecessary or inefficacious use of such pharmaceuticals.”
Many of these efforts, though, have been ineffective at curtailing the prescribing of some topical drugs, he said.
CWCI’s research is among the latest studies to come to the same conclusion. It’s not that the creams are ineffective; it’s that many of the medications are the same as what one could pick up at a pharmacy — and the insurers don’t catch on until the bill is sent.
“These types of transactions usually get billed through a third-party biller or can be billed direct from the prescriber,” said Johnny Taylor, Tampa, Florida-based assistant vice president pharmacy and ancillary networks for GBCare, a unit of Gallagher Bassett Services Inc.
“Many of these high-cost topical combo products are simply combinations of medications that are already available over the counter in slightly different strengths, and, despite this being the case, the cost for these agents can be between 10 and 50 times that of the over-the-counter formulation,” he said.
The industry has put in place “clinical guardrails” with limited success, according to Nikki Wilson, senior director of clinical pharmacy services at Enlyte LLC, which reported a year-over-year 11% increase in topical prescriptions in 2022.
Seventeen states, including California, have workers comp drug formularies that dictate what can be prescribed to injured workers. Many have utilization review processes included in the formularies. Individual insurers also have drug lists for approved medications.
However, all of these haven’t curbed the prescribing of some topical drugs, according to experts. That’s because some of the topical agents prescribed aren’t listed on formularies, they say.
“You have to know how to identify (the topical) to even put it on the drug list,” Ms. Wilson said. “It’s a little tricky, and the rules haven't really caught up. Many of (the drugs) are physician-dispensed, which is allowed by regulation in some states. So, they're finding these loopholes.”
Mr. Taylor said there has been some progress: on average topicals account for 8% of the total script count but 20% of the total pharmacy spend in GBCare’s data. In 2019, topicals accounted for 25% of the pharmacy spend.
“We put some controls in place,” he said. For example, when a topical is prescribed and dispensed without authorization GBCare will later assign a nurse case manager or a doctor to have a peer-to-peer discussion with the injured worker’s doctor or conduct a drug utilization assessment. This can curb further prescribing of the expensive medications and offer alternatives, he said.
“With the enhanced workflows and the clinical oversight that we've applied over time, this puts us in a good position when we notice questionable prescribing behaviors that warrant further engagement,” he said.