February 22, 2018

A workers’ compensation and auto no-fault continuing education course

Pharmacy trends in workers' comp and auto no-fault claims

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This course has been approved for 1-hour of CE for the following license types: Pre-approved Adjuster (AK, AL, CA, DE, FL, GA, ID, IN, KY, LA, MS, NC, NH, NM, OK, OR, TX, UT, WY); Certified Case Manager (CCM); National Nurse (all states except Iowa); Certification of Disability Management Specialists (CDMS); Commission on Rehabilitation Counselor (CRC); and Certified Medicare Secondary Payer (CMSP) for CE accreditation. For states that do not require prior approval, the adjuster is responsible for submitting their attendance certificate to the appropriate state agency to determine if continuing education credits can be applied.

Administrative details

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2. Answer all three poll questions.

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To receive continuing education credit

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2. Answer all three poll questions.

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Disclosure

No planner, presenter or content expert has a conflicting interest affecting the delivery of this continuing education activity. Optum does not receive any commercial advantage nor financial remittance through the provided continuing education activities.

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Medical disclaimer

Medicine is an ever-changing science. As new research and clinical experience broaden our knowledge, new treatment options and approaches are developed. The authors have checked with sources believed to be reliable in their efforts to provide information that is complete and generally in accord with the standards accepted at time of publication.

However, in view of the possibility of human error or changes in medical sciences, neither Optum nor any other party involved in the preparation or publication of this work warrants the information contained herein is in every respect accurate or complete, and are not responsible for errors or omissions or for the results obtained from the use of such information. Readers are encouraged to confirm the information contained herein with other sources.

This educational activity may contain discussion of published and/or investigational uses of agents that are not approved by the Food and Drug Administration (FDA). We do not promote the use of any agent outside of approved labeling. Statements made in this presentation have not been evaluated by the FDA.

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Disclaimer

• The display or graphic representation of any product or description of any product or service within this presentation shall not be construed as an endorsement of that product by the presenter or any accrediting body. Rather, from time to time, it may facilitate the learning process to include/use such products or services as a teaching example.

• Accreditation of this continuing education activity refers to recognition of the educational activity only and does not imply endorsement or approval of those products and/or services by any accrediting body.

• CE credits for this course are administered by the CEU Institute. If you have any issues or questions regarding your credits, please contact rosters@ceuinstitute.net.

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Data methodology

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• Based on paid workers’ compensation transactions covering 2016 and 2017

• More than 850,000 claims and about nine million prescriptions were analyzed

• Includes in-network prescriptions captured through the application of our network enforcement solutions for our workers’ compensation

• Excludes clients who have had less than a two-year history with our company

Presenters

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Tron Emptage, MA, R.Ph. Chief Clinical Officer

Joe Anderson, MBADirector of Analytical Services

Learning objectives

• Identify global trends in workers’ comp and auto no-fault

•Review industry data on opioid utilization

•Understand the impact of MED levels on claims

•Understand cost per claims

•Review legislative influences

1515

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Industry challenges require stakeholders work together

D i s p a r a t e s y s t e m s

FRAUD, WASTE AND ABUSE

R E D U C I N G COSTS

O P I O I D A N A L G E S I C S

HELPING INJURED PARTIES RECOVERsimplifying claim administration

Evolving regulatory environment

OVER UTILIZATION

Fragmented care

INCOMPLETE INFORMATIONLACK OF VISIBILITY

misinformation

inadequate resources

TALENT GAP Unique jurisdictional requirements

C o m p o u n d e d m e d i c a t i o n s

c o m p e t i n g p r i o r i t i e s

ANALYTIC SERVICES

Key findings

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Average Rx cost per claim

3.4% 5.2%Overall AWP increase

1.9%Change in claim age

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

2017 Cost and Utilization

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-3.4%

Key findings for opioid analgesics

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1.6%Opioid utilization

5.7%MED per claim

Percentage of claims

4.3% 2.4%Percentage of spend

1.9%Percentage of scripts

Potential drivers for industry trends

•Claim age

•Prescription inflation (Average Wholesale Price)

•Medication utilization－Opioid analgesics

－Generic utilization controls

－Specialty medications

－Compounded medications

• Industry influences

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Claim age drives costs and utilization – Percentage of claims

16.0%

1.3%

1.5%

1.7%

2.0%

2.4%

3.5%

5.9%

16.0%

49.8%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

% C

laim

s

12345678910+

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Claim age drives costs and utilization – Percentage of scripts

43.1%

2.9%

3.1%

3.3%

3.4%

3.6%

4.5%

6.1%

11.2%

18.8%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

% S

crip

ts

12345678910+

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Claim age drives costs and utilization – Percentage of spend

58.8%

3.5%

3.7%

3.7%

3.8%

3.8%

4.2%

5.0%

6.6%

6.9%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

% S

pend

12345678910+

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Average wholesale price

6.2%

4.7%

6.1%

7.8%

11.4%10.5%

6.1%5.2%

0.4% 0.4% 0.5% 0.7%

10.0%

4.9%

0.3%1.0%

8.4%

7.2%

9.4%

13.3%12.5%

17.0%

14.1%

10.9%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

2010 2011 2012 2013 2014 2015 2016 2017

Overall Generic Brand

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Average wholesale price

6.2%

4.7%

6.1%

7.8%

11.4%10.5%

6.1%5.2%

0.4% 0.4% 0.5% 0.7%

10.0%

4.9%

0.3%1.0%

8.4%

7.2%

9.4%

13.3%12.5%

17.0%

14.1%

10.9%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

2010 2011 2012 2013 2014 2015 2016 2017

Overall Generic Brand

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• AWP inflation for generic medications increased from 0.3% in 2016 to 1.0% in 2017

• AWP inflation for brand medications decreased from 14.1% to 10.9%

• Overall AWP increase of 5.2%

What drives AWP inflation?

•Entry into market

•Brand medication patent expiration

•Supply and demand

•Regulatory influence

•Number of manufacturers

• Issues with manufacturing

－Shortage and increase cost of raw materials

－Natural Disasters

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Utilization management

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Change in overall utilization

3.7% 4.9%Change in product and claim mix

4.3%pts

Claimants Using Opioid Analgesics

Number of prescriptions per claim

Average Days’ Supply per prescriptions

Utilization management involves the application of

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•Global medication management programs

•Clinical tools

•Claims professional expertise

•Government Affairs

•Stakeholder partnerships

• Interaction with providers

Top 10 therapeutic classes ranked by total prescriptions

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29.1%

14.7%

10.9%

10.7%

7.4%

4.0%

2.2%

2.1%

1.8%

1.6%

0% 5% 10% 15% 20% 25% 30% 35%

Opioid analgesics

Anti-inflammatories

Musculoskeletal therapy agents

Anticonvulsants

Antidepressants

Dermatologicals

Antianxiety agents

Ulcer drugs

Hypnotics/Sedatives/Sleep disorder agents

Corticosteroids

2016 2017

Top 25 medications by number of prescriptions

2017rank

2016rank

TotalRx

Common brand name Generic name Therapeutic class

1 1 9.7% Vicodin, Norco tablet hydrocodone-acetaminophen Opioid analgesics2 5 4.5% Motrin, Advil tablet ibuprofen Anti-inflammatories3 2 4.4% Percocet tablet oxycodone-acetaminophen Opioid analgesics4 4 4.3% Flexeril tablet cyclobenzaprine Musculoskeletal therapy agents5 3 4.3% Ultram tablet tramadol Opioid analgesics6 6 4.0% Neurontin capsule gabapentin Anticonvulsants7 9 2.8% Mobic tablet meloxicam Anti-inflammatories8 7 2.8% Lyrica capsule pregrabalin Anticonvulsants9 8 2.7% Roxicodone tablet oxycodone Opioid analgesics10 10 2.5% Naprosyn tablet naproxen Anti-inflammatories11 11 2.3% Cymbalta capsule duloxetine Antidepressants12 12 2.0% Celebrex capsule celecoxib Anti-inflammatories13 13 1.9% Neurontin tablet gabapentin Anticonvulsants14 14 1.9% Zanaflex tablet tizanidine Musculoskeletal therapy agents15 15 1.6% Oxycontin tablet oxycodone ER Opioid analgesics16 16 1.4% Lidoderm Patch lidocaine Dermatologicals17 18 1.3% Robaxin tablet methocarbamol Musculoskeletal therapy agents18 19 1.2% Baclofen tablet baclofen Musculoskeletal therapy agents19 17 1.2% Tylenol/Codeine tablet APAP/Codeine Opioid analgesics20 21 1.0% Amitriptyline tablet amitriptyline Antidepressants21 22 1.0% Voltaren gel diclofenac sodium Dermatologicals22 20 0.9% Ambien tablet zolpidem Hypnotics/Sedatives/Sleep disorder agents23 29 0.9% Medrol pak Methylpred pak Corticosteroids24 24 0.8% MS Contin tablet morphine sulfate ER Opioid analgesics25 25 0.8% Prilosec capsule omeprazole Ulcer drugs

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Top 10 therapeutic classes ranked by total spend

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27.6%

16.4%

8.5%

8.2%

6.2%

6.2%

2.6%

2.1%

2.0%

1.8%

0% 5% 10% 15% 20% 25% 30% 35%

Opioid analgesics

Anticonvulsants

Anti-inflammatories

Dermatologicals

Antidepressants

Musculoskeletal therapy agents

Antiasthmatic and bronchodilator agents

Ulcer drugs

Antipsychotics/Antimanic agents

Hypnotics/Sedatives/Sleep disorder agents

2016

2017

Top 25 medications by spend

2017rank

2016rank

Totalspend

Common brand name Generic name Therapeutic class

1 1 9.8% Lyrica capsule pregrabalin Anticonvulsants2 2 6.4% Oxycontin tablet oxycodone ER Opioid analgesics3 3 5.1% Percocet tablet oxycodone-acetaminophen Opioid analgesics4 4 3.0% Lidoderm Patch lidocaine Dermatologicals5 6 2.9% Cymbalta capsule duloxetine Antidepressants6 5 2.6% Vicodin, Norco tablet hydrocodone-acetaminophen Opioid analgesics7 7 2.5% Celebrex capsule celecoxib Anti-inflammatories8 8 2.1% Neurontin tablet gabapentin Anticonvulsants9 10 2.0% Neurontin capsule gabapentin Anticonvulsants10 11 1.6% Roxicodone tablet oxycodone Opioid analgesics11 9 1.6% Duragesic patch fentanyl Opioid analgesics12 12 1.5% Mobic tablet meloxicam Anti-inflammatories13 13 1.3% Nucynta tablet tapentadol Opioid analgesics14 14 1.2% Flector patch diclofenac Dermatologicals15 17 1.1% Baclofen tablet baclofen Musculoskeletal therapy agents16 18 1.1% Flexeril tablet cyclobenzaprine Musculoskeletal therapy agents17 23 1.0% Pennsaid sol Diclofenac sol Dermatologicals18 15 1.0% Ultram tablet tramadol Opioid analgesics19 24 1.0% Nucynta ER tablet tapentadol ER Opioid analgesics20 19 0.9% Skelaxin tablet metaxalone Musculoskeletal therapy agents21 21 0.9% Duexis tablet ibuprofen-famotidine Anti-inflammatories22 20 0.8% MS Contin tablet morphine sulfate ER Opioid analgesics23 25 0.8% Zanaflex tablet tizanidine Musculoskeletal therapy agents24 26 0.8% Butrans patch buprenorphine Opioid analgesics25 27 0.8% Topamax tablet topiramate Anticonvulsants

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U.S. drug overdose deaths involving opioid analgesics 2000-2015

Opioid analgesics

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Change in utilization

1.6% 2.3%Number of scripts per claim

0.7%Average days’ supply per script

53.7% in 2016

Percent of claims utilizing opioid analgesics

3.5% per claim

Overall opioid spend

49.4% in 2017

Opioid analgesics reductions resulted from

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• Aggressive formulary management

• Clinical interactions with claims professionals

• Communications with prescribers throughout the care continuum

• Regulatory actions

• Education of providers

• Public awareness

Morphine equivalent dose (MED)

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MED per script

4.0% 5.0%MED per claim

According to the Washington State Agency Medical Director’s Group (AMDG), patients receiving 100mg or more per day of MED

had a nine fold increase in overdose risk.

Morphine equivalent dose (MED) reductions resulted from

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•Collaboration with clients

•Change in physician prescribing patterns

• Increased use of the MED in treatment guidelines and references

•Regulatory changes and new legislation both in Workers’ Compensation rule as well as medical and pharmacy practice acts at the state and federal levels

Initial opioid prescribing limits

Data – Reflects enacted legislation/regulation enacting initial opioid prescribing limits for treatment of acute pain. Note – Initial days supply limits can vary across jurisdictions and treatment facilities.

Most states include exemptions for cancer or other end-of-life care.

* Indicates requires rule-making/development before full enactmentCurrent as of January 2018.

WA*

OR

CA

NV

ID

MT

WY

COUT

NMAZ

TX

OK

KS

NE

SD

ND MN

WI

IL

IA

MO

AR*

LA

AL

TN

MIPA

NY

VT

GA

FL

MS

KY*

SC

NC

MDOH DE

IN* WV

NJCT

MA

ME

RI

VA

NH

AK

DC

HI

No recent limits enacted

2017 Policy enacted

2016 Policy enacted

Seven-day supply – AK, CT, DE, HI, IN, LA, ME, MA, MI, NH, NY, OH, UT, VA & VTFive-day supply – NJ, NCThree-day supply – KYOther – PA (hospitals and urgent care only), RI (MME Level), AR (Schedule II), MD (lowest effective dose), NV (14 day), WA (rule-making)

Change AlertMI – OH – VA – Enact 7 Day Supply Restrictions for 2018

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Opioid policies

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State/Action Description Status

Arizona

Senate Bill 1001 • Limits initial CII opioid prescription to no more than a 5-day supply and initial opioid prescription following surgery to a 14-day (exceptions for cancer/hospice care)

• Limits new prescription orders for a CII opioid to a maximum of 90 MME per day without pain specialist consultation

• Requires co-prescribing of an opioid antagonist for any treatments which exceed 90 MME per day

Effective April 26, 2018

Arkansas

Regulatory (WC Specific Drug Formulary)

• Limits all initial opioid prescriptions to a five-day supply with a maximum of 50 MEDs• Limits all subsequent opioid prescriptions to a 90-day supply with a maximum of 50 MEDs• Treatment can exceed 50 MEDs but only with prior authorization and by no means should treatment

exceed 90 MEDs

EffectiveFor all DOI on or after July 1, 2018

Florida

Senate Bill 8House Bill 21

• Limits all initial opioid prescriptions to a three-day supply• Permits doctors to write up to a seven-day supply with medical justification

Currently in legislative activity

Michigan

LegislativeSB 274

• When treating for acute pain, a prescriber shall not prescribe more than a seven-day supply of an opioid• Acute pain is defined as pain which is the normal, predicted physiological response to and is typically

associated with invasive procedures, trauma and disease and usually lasts for a limited amount of time

Signed by Governor Effective July 1, 2018

Minnesota

Regulatory(Recommendationsto Governor)

• Provide and support full implementation of e-prescribing for all controlled substances• Support use of evidence-based clinical guidelines and clinical decision support• Address affordable, effective and seamless access and use of state PDMP program

NA

Opioid policies

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State/Action Description Status

New Jersey

Senate Bill 3604 • Defines Chronic Pain and establishes treatment requirements for usage of opioids when treating Chronic Pain

• Includes usage of Pain Management Agreement prior to commencement of an ongoing course of opioids to treat Chronic Pain

• Expands the requirements for prescribers to check the PDMP for certain drugs and for any new patient• Permits development of rules to require pharmacies to report data to the state PDMP

Effective January 16, 2018

North Carolina

Regulatory (WC Specific Treatment Guidelines)

• Defines acute pain/phase and chronic pain/phase as separate for application of guidelines• Limits first opioid prescription to a five-day supply and 50 MEDs• Acute Pain – Opioid should not exceed 30-day supply and 50 MEDs w exception allowing up to 90 MEDs

with medical justification• Chronic Pain – Opioid should not exceed 30-day supply and 50 MEDs w/ exception allowing up to 90

MEDs with medical justification – Preauthorization is required to exceed 90 MEDs

Currently in rule-making with the Industrial Commission

Comments Due March 19th

South Carolina

Regulatory • Governor issues executive order restricting initial prescriptions for opioids to treat acute pain (Medicaid patients) to a 5-day supply – Requires DHS to develop global prescribing rules around opioids

Ongoing

Virginia

Regulatory • Board of Medicine adopts rules related to opioid utilization for treatment of acute pain• Limits prescription of opioids for acute pain to a quantity which shall not exceed a seven-day supply• Initiation of opioid treatments shall be with short-acting opioids and include justification of exceeding 50

MME per day• Additional requirements have been established for evaluation and treatment of chronic pain

Effective August 1, 2017

Generic efficiency and generic utilization

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Generic utilization

85.7% 99.7%Generic efficiency

1.0%

Up three points from 2016

in generic utilization 4.0% in

spend

Generic medications by percentage of spend

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2017rank

2016rank

Totalgenericspend

Generic name Common brand name Therapeutic class Totalgeneric Rx

1 1 7.3% oxycodone-acetaminophen Percocet tablet Opioid analgesics 5.0%2 2 5.8% duloxetine Cymbalta capsule Antidepressants 2.5%3 3 5.0% hydrocodone-acetaminophen Vicodin, Norco tablet Opioid analgesics 11.2%4 5 4.6% lidocaine Lidoderm Patch Dermatologicals 1.4%5 4 4.5% celecoxib Celebrex capsule Anti-inflammatories 2.2%6 6 4.0% gabapentin Neurontin tablet Anticonvulsants 2.2%7 7 3.9% gabapentin Neurontin capsule Anticonvulsants 4.7%8 9 3.2% meloxicam Mobic tablet Anti-inflammatories 3.3%9 8 3.2% oxycodone Roxicodone tablet Opioid analgesics 3.1%10 11 2.4% baclofen Baclofen tablet Musculoskeletal therapy agents 1.4%11 12 2.3% cyclobenzaprine Flexeril tablet Musculoskeletal therapy agents 5.1%12 13 2.0% tramadol Ultram tablet Opioid analgesics 4.9%13 10 1.8% fentanyl Duragesic patch Opioid analgesics 0.7%14 15 1.7% metaxalone Skelaxin tablet Musculoskeletal therapy agents 0.7%15 17 1.7% tizanidine Zanaflex tablet Musculoskeletal therapy agents 2.2%16 14 1.6% morphine sulfate ER MS Contin tablet Opioid analgesics 1.0%17 16 1.5% aripiprazole Abilify tablet Antipsychotics/Antimanic agents 0.2%18 26 1.4% lidocaine oin Lidocaine oin Dermatologicals 0.2%19 18 1.4% topiramate Topamax tablet Anticonvulsants 0.6%20 20 1.3% ondansetron Zofran tablet Antiemetics 0.3%21 19 1.3% ibuprofen Motrin, Advil tablet Anti-inflammatories 5.2%22 23 1.1% naproxen Naprosyn tablet Anti-inflammatories 2.9%23 21 1.1% omeprazole Prilosec capsule Ulcer drugs 0.9%24 22 1.0% zolpidem Ambien tablet Hypnotics/Sedatives/Sleep disorder agents 1.0%25 38 0.9% diclofenac sodium Voltaren gel Dermatologicals 1.1%

Jurisdictional generic medication mandates

DAW = Dispense as Written DNS = Do Not Substitute Data – Reflects published state workers’ compensation statutes/regulations on generic dispensing. *Indicates injured worker can pay difference between brand and generic when brand dispensed without proper authorization. Current as of January 2018.

WA

OR*

CA

NV

ID

MT*

WY*

COUT

NMAZ

TX*

OK

KS

NE

SD

ND* MN

WI*

IL

IA

MO

AR

LA

AL

TN*

MIPA

NY

VT*

GA

FL*

MS

KY*

SC

NC

MDOH* DEIN WV*

NJCT

MA

ME*

RI

VA

NH

AK*

DC

HI

Substitution mandated

Substitution mandated except where prescriber notate DAW, DNS or similar

Substitution mandated except where written statement of medical necessity, prior authorization or other requirement provided/met

Substitution not specifically mandated for workers’ compensation

Change AlertCA – Effective January 2018 (Drug Formulary) all Brands w Generic Equivalent require PA

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Recent generic medication releases

52

Generic name Brand name Therapeutic class Release date

Venlafaxine HCl ER 225 mg Tablets Antidepressant Q1 2017

Desvenlafaxine succinate extended-release tablet Pristiq® Antidepressant Q1 2017

Emtricitabine and Tenofovir Disoproxil Fumarate Tablets Truvada® Anti-Infective Q2 2017

Atomoxetine Strattera® ADHD Non-Stimulant Q2 2017

Abacavir Ziagen® Antiretrovirals Q3 2017

Fosamprenavir Lexiva® Antiretrovirals Q3 2017

Eletriptan Relpax® Anti-migraine “Triptan” Q3 2017

Buprenorphine Patch(authorized generic) Butrans® Opioid Partial Agonist Q3 2017

sildenafil Viagra® PDE-5 Inhibitors Launched December 2017

fentanyl (sublingual) Abstral® Opioid analgesics Approved 11/17/2017

topiramate extended-release Trokendi® XR Anticonvulsants Approved 11/24/2017

efavirenz Sustiva® Antiretrovirals 50 mg and 200 mg launched Q4 2017; 600 mg pending

lopinavir/ritonavir Kaletra® Antiretrovirals Solution launched Q4 2017; tablets pending

atazanavir Reyataz® Antiretrovirals Launched Q4 2017

tenofovir DF Viread® Antiretrovirals Launched Q4 2017

Anticipated generic medication releases

53

Brand(Manufacturer)

Generic name Anticipated availability

AndroGel 1.62% (AbbVie)

Testosterone 2018

Kaletra(Abbott)

Lopinavir/Ritonavir tablet 2018

Norvir(Abbvie)

Ritonavir 100 mg tablet 2018

Sustiva(Bristol-Myers Squibb)

Efavirenz 2018

Travatan Z(Alcon)

Travoprost 0.004% ophthalmic solution

2018 or 2019

Solodyn(Medicis)

Minocycline extended-release tablet 65 mg, 115 mg

February 2018

Treximet(Pozen)

Sumatriptan/Naproxen February 2018

Factive(Cornerstone)

Gemifloxacin tablet March 2018

Sensipar(Amgen)

Cinacalcet tablet March 2018

Enbrel(Amgen)

Etanercept April 2018 or later

Adcirca(Lilly)

Tadalafil May 2018

Abstral(Orexo)

Fentanyl sublingual tablet June 2018

Remodulin(United Therapeutics)

Treprostinil injection June 2018 (or earlier)

Brand (Manufacturer)

Generic name Anticipated availability

Levitra(GlaxoSmithKline)

Vardenafil tablet 3rd quarter 2018

Acanya(Valeant)

Benzoyl peroxide 2.5%/ Clindamycin phosphate 1.2%

July 2018 (or earlier)

Ampyra(Acorda)

Dalfampridine extended-release tablet

July 2018

Aloxi(Eisai)

Palonosetron injection September 2018 (or earlier)

Cialis(Eli Lilly)

Tadalafil September 2018

Staxyn(Bayer)

Vardenafil orally disintegrating tablet

October 2018

Finacea(Bayer)

Azelaic acid gel November 2018

Fortesta(Endo)

Testosterone gel November 2018

Trisenox(Cephalon)

Arsenic trioxide November 2018

Ziagen(Viiv)

Abacavir oral solution November 2018

Rapaflo(Allergan)

Silodosin Before December 2018

Canasa(Aptalis)

Mesalamine rectal suppository 1 g

December 2018

Lyrica(Pfizer)

Pregabalin December 2018

Brand medications by daily spend

2017rank

2016 rank

Common brand name Generic name Therapeutic class 2017 dailyspend

1 1 Pennsaid sol Diclofenac sol Dermatologicals $94.412 3 Vimovo tablet esomeprazole/naproxen Anti-inflammatories $77.233 4 Duexis tablet ibuprofen-famotidine Anti-inflammatories $69.734 2 Percocet tablet oxycodone-acetaminophen Opioid analgesics $67.235 5 Truvada tablet tenofovir/emtricitabine Antivirals $55.526 NA Isentress tab raltegravir Antivirals $48.597 7 Duragesic patch fentanyl Opioid analgesics $43.178 8 Amrix capsule cyclobenzaprine er Musculoskeletal Therapy Agents $39.509 9 Viagra tablet sildenafil Cardiovascular Agents - Misc. $39.3210 12 Cialis tablet tadalafil Cardiovascular Agents - Misc. $25.2211 11 Nucynta er tablet tapentadol er Opioid analgesics $24.8312 14 Lidoderm patch lidocaine Dermatologicals $22.7913 10 Opana er tablet oxymorphone er Opioid analgesics $22.7314 NA Horizant tab gabapentin Psychotherapeutic and neurological agents - Misc. $22.4815 16 Flector patch diclofenac Dermatologicals $21.5416 13 Oxycontin tablet oxycodone ER Opioid analgesics $21.4317 15 Nucynta tablet tapentadol Opioid analgesics $20.6518 17 Gralise tablet gabapentin Psychotherapeutic and neurological agents - Misc. $19.1819 18 Butrans patch buprenorphine Opioid analgesics $17.2520 20 Lyrica capsule pregrabalin Anticonvulsants $17.2221 19 Vicodin, Norco tablet hydrocodone-acetaminophen Opioid analgesics $16.9322 21 Celebrex capsule celecoxib Anti-inflammatories $15.4623 22 Xarelto tab Rivaroxaban Anticoagulants $13.9724 23 Advair diskus fluticasone/salmeterol Antiasthmatic and bronchodilator agents $13.6925 24 Movantik tablet naloxegol Gastrointestinal Agents - Misc. $11.26

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55

Specialty medications

• Used to treat complex medical conditions

• Associated with limited use, high cost, and complicated regimens

• Formularies and clinical resources help validate appropriate use

• Injured workers benefit from medication education and adherence monitoring

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% of total prescriptions

0.4% 3.4%Cost per script

Medication Average price per script

Truvada® $1,033.03

Isentress® $841.54

Enoxaparin® $259.80

Euflexxa® $968.11

Synvisc One® $1,390.51

Tacrolimus® $602.16

Specialty medication characteristics

• Treats a condition, which requires intensive clinical monitoring of the patient.

• Requires special patient training or patient compliance assistance.

• Requires special handling, such as storage or preparation.

• Requires special administration by the patient or the healthcare professional.

• Has a limited distribution network.

• Has a high total cost.

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Source: https://www.pti-nps.com/nps/index.php/specialty-medications/

Compounded medications

59

Number of injured workers using compounded meds

0.2%pts 48.0%Percentage of total spend

36.0%Percentage of total prescriptions

0.7% in 20160.5% in 2017

1.1% of total spend 0.2% of total

prescriptions

Compounded medications represent…

AND

Compounded medication regulations

*Additional state regulatory/statutory language regarding billing and reimbursement for compounded medications (including physician dispensed compounded medications). Data – Reflects published statutes/regulations/fee schedules related to workers’ compensation compounded medication billing/reimbursement. Current as of January 2018.

WA*

OR

CA*

NV*

ID

MT

WY*

COUT

NMAZ

TX

OK*

KS*

NE

SD

ND* MN

WI

IL

IA

MO

AR

LA

AL

TN

MI* PA

NY*

VT

GA*

FL*

MS*

KY*

SC

NC

MDOH* DEIN WV

NJCT

MA

ME

RI*

VA

NH

AK*

DC

HI

60

Industry influences

•Comorbid conditions

•Medical marijuana

•Treatment guidelines and formularies

•Physician dispensing

63

Comorbid conditions

64

Substance use

Insomnia

Depression

Arthritis

Cardiovascular disease and stroke

Diabetes

Hypertension Obesity

Medical marijuana

65

% of total dispenses

NA NACost per dispense

• The FDA has never approved the use of medical marijuana

• Physicians are increasingly recommending marijuana to treat conditions such as－ Human immunodeficiency virus (HIV)-induced cachexia－ Cancer-related nausea/vomiting－ Anorexia－ Glaucoma－ Epilepsy－ Multiple sclerosis－ Inflammatory bowel disease－ Severe chronic pain

Medical marijuana

Source: ProCon.org *Includes workers’ comp fee schedule reimbursement for medical marijuana. Current as of January 2018.

WA

OR

CA

NV

ID

MT

WY

COUT

NM*AZ

TX

OK

KS

NE

SD

ND MN

WI

IL

IA

MO

AR

LA

AL

TN

MIPA

NY

VT

GA

FL

MS

KY

SC

NC

MDOH DE

IN WV

NJCT

MA

ME

RI

VA

NH

AK

DC

HI

Medical use of marijuana currently prohibited with legalized usage of cannabidiol (CBD) for limited purposes

Legalized medical marijuana

Legalized recreational and medical marijuana

Medical use of marijuana currently prohibited

66

Medication formularies and guidelines

Reflects most current published jurisdictional workers’ compensation treatment guidelines or formularies (prescription drug utilization specific). Current as of January 2018.

WA

OR

CA

NV

ID

MT

WY

COUT

NMAZ

TX

OK

KS

NE

SD

ND MN

WI

IL

IA

MO

AR

LA

AL

TN

MIPA

NY

VT

GA

FL

MS

KY

SC

NC

MDOH DE

IN WV

NJCT

MA

ME

RI

VA

NH

AK

DC

HI

WC Treatment Guidelines

WC Treatment Guidelines,as well as State WC Specific Formulary or Preferred Drug List (PDL)

None

Change AlertCA – Drug Formulary effective January 2018

67

Physician Dispensing/Repackaging Restrictions

Note – States such as AR, DE, FL, KY, NY, and TN have overlapping workers’ compensation and state Practice Act controls. Data – Reflects published state statutes/regulations/case law on Physician Dispensing/Repackaging. Current as of January 2018.

WA

OR

CA

NV

ID

MT

WY

COUT

NMAZ

TX

OK

KS

NE

SD

ND MN

WI

IL

IA

MO

AR

LA

AL

TN

MIPA

NY

VT

GA

FL

MS

KY

SC

NC

MDOH DE

IN WV

NJCT

MA

ME

RI

VA

NH

AK

DC

HI

Workers’ compensation statutes/regulations limit physician dispensing and/or repackaging (restrictions on dispensing, billing and/or reimbursement).

Legal restrictions (Practice Act) in addition to workers’ compensation controls

Legal restrictions on physician dispensing (Practice Act)

No clear legal or workers’ compensation limits on physician dispensing and/or repackaging

Change AlertWY – Implements requirements on physician dispensing of repackaged drugs

68

Looking ahead in 2018

•We anticipate utilization of opioid analgesics and MED will continue to decline while the use of medications to assist in the tapering and weaning of opioids from claimants taking them will increase.

• It is anticipated that the need for and utilization of addiction treatment programs will increase

•Closed formularies, treatment guidelines, PDMPs, urine drug testing and monitoring, specialty medications, and multi-disciplinary care will persist and increase in use

•We will continue to monitor the use of medical marijuana in workers’ compensation and the impact of mandated payment for the treatment will have on claims and claim costs

•Specialty medications for the treatment of pain and related conditions may continue to increase as they are developed

70

What does all this mean for payers?

• Implementation of cost and utilization strategies that start with the first fill and work toward controlling

•While payers, pharmacies, and PBMs do not calculate or determine the rise or fall in AWP, we can work together to avoid paying for the most expensive prescriptions – those that should not have been paid in the first place

•When analytics, clinical tools and expertise, network enforcement, and advocacy in government affairs harmonize, positive change is the result

•Ensuring the right medication at the right time, in the right dosage, for the right duration requires diligence throughout the care continuum

72

Thank you!Questions?

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