October 20, 2015Back
The Pharmacy Cost Creep
In a recent article in Risk & Insurance, Katie Siegel reports on a three part series highlighting pharmacy utilization in workers’ compensation. In one part of the series, she discusses methods prescription drug utilization can be controlled, despite the fact that it makes up 19 percent of workers’ compensation medical costs, according to the National Council on Compensation Insurance.
Siegel cites compound and specialty medications, physician dispensing and increased prices for generic drugs as the main culprits for the high share of total spending.
In order to best manage pharmacy costs, Siegel reports that prospective program management via justification documentation for the compound or an alert system is necessary.
CorVel believes proactive management is the best solution to keep pharmacy program costs in control and can also yield numerous other benefits. The company’s pharmacy expertise also allows them to deliver solutions based on the need of their clients.
Matt Engels, Vice President, Network Solutions, at CorVel spoke with Siegel about the critical role a proactively managed program can play within the workers’ compensation industry:
“‘It all comes back to the ability to hold a contracted provider and any assigned third party accountable for their obligations,’ CorVel’s Engels said.
‘Employers need 100 percent capture of all pharmacy transactions and transparency on how these transactions were dispensed in order to trigger the applicable obligations.’”
CorVel’s pharmacy model manages total exposure and offers maximum network penetration, a first fill program, formulary management, brand to generic conversion, a mail order program and aggressive drug utilization management. Integrated with their bill review program, CorVel offers their clients complete transparency into their entire pharmacy exposure for optimal management.
As for addressing the issue of compounds contributing to increased costs, Engels also suggested that employers should look into the efficacy of the various ingredients within a compound. The base ingredient, he points out, could be an unnecessarily expensive component of a compound. To read more about compounds and how to most effectively manage them, read CorVel’s Compound Whitepaper.
Read Siegel’s entire series titled “The Pharmacy Cost Creep” on Risk & Insurance’s website.