©2014 CorVel Corporation. All rights reserved. Physician Dispensing in Work Comp Impact of the practice on overall costs and exposure Tips on how to manage

©2014 CorVel Corporation. All rights reserved.

Physician Dispensing in Work Comp

Impact of the practice on overall costs and exposureTips on how to manage it


Hospital and Facility

Physician ServicesPharmacy

Physical Medicine

Imaging DME

Pharmacy drives 10-20% of your unit cost as a percent of total

medical.

Source: 2011 NCCI Issues Report

What percent of your total exposure relates

to claims with prescription meds and

IWs suffering from pain?


Physician Dispensing Price Difference: TramadolTramadol

50 MG

Manufacturer/ Labeler

AWP Price per Pill

AWP Price - 60 Pills

Package Size Dispensed Mark-up*

00093-0058-05 Teva USA $ .83 $ 49.80 500 60 0%

65162-0627-50 Amneal $ .83 $ 49.80 500 60 0%

36329-2868-02 Bryant Ranch $1.61 $ 96.60 60 60 194%

33261-0105-60 Aidarex Pharm $1.62 $ 97.20 60 60 195%

42549-0527-60 Stat Rx USA $1.66 $ 99.60 60 60 200%

55045-2928-09 DRX $1.55 $ 93.00 60 60 187%

60760-0377-60 St. Mary’s $1.41 $ 84.60 60 60 170%

66336-0915-60 Dispensing Solutions $1.55 $ 93.00 60 60 187%

* Percent of mark-up measured against original manufacturers’ AWP.


Release of Study Medical Costs

Indemnity Costs

Source

CA Feb 2013 +17% +13% http://www.cwci.org/press_release.html?id=318

IL May 2014 +39% +27% (JOEM _ Volume 56, Number 5, May 2014 Physician-Dispensed Medication and Workers’ Compensation Claim Outcomes)

IL May 2014 opioids

+78% +57% (JOEM _ Volume 56, Number 5, May 2014 Physician-Dispensed Medication and Workers’ Compensation Claim Outcomes)

What the studies say:Impact of Physician Dispensing on Total Claim Costs

http://www.cwci.org/press_release.html?id=318


Questions for the Audience

• Where do we see “third party billing?”

Retail, Physician Dispensing, Everywhere!

Stone River (retail and physicians), Prescription

Partners



• Where do we see “third party

• Partners

• What is the legal status of the third party biller?

Assignee

• What are the obligations of an assignee?

Identical to the underlying provider



• Where do we see “third party

• eywhertail and p

• What are the obligations of an assignee?

Identical to the underlying provider


The FactsAssignees are ALREADY OBLIGATED!

• PBM Contracts with underlying pharmacies

• PPO Contracts with underlying prescribers


The Facts

Assignees are ALREADY OBLIGATED!

• PBM Contracts with underlying pharmacies

• PPO Contracts with underlying prescribers

Impact of contracts with assignees

Grant them rights and frees them from

obligations

Disables Prospective Mgt/ Enables more retro

PBM re-sells transaction at a spread

Expedient?

Right thing to do?


What you can do

Apply underlying PPO discount

• Can I?

• Everywhere?

• Yes you can!

Deny subsequent transactions based on

PPO contractual obligations

• Can I?

• Everywhere?

• PPO - Utilization Mgt or specific prohibition

• Contractually yes, but leverage is the issue

• Requires notice

• Re


Question for the Audience

What presents more risk in terms of your cost

drivers?

• Unit price?

• Utilization?

• The unknown?


Identify providers who dispense meds in

office

• Leverage bill review

• Manage the data

Maximize provider selection tools

• Include a physician dispensing indicator

• Layer the order based on criteria

• Preclude panel populating

• Educate your PPO providers

• Re

You can make the unknown more known!


Search Results – Make them meaningful


Appendix


Agenda


Agenda

Documents

©2014 CorVel Corporation. All rights reserved. Physician Dispensing in Work Comp Impact of the practice on overall costs and exposure Tips on how to manage