Alex Swedlow Talks “California’s Altered State” at WCRI in Boston

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Kara March 2017 WCRI Article
The WCRI Conference took place in Boston in March. This always popular conference again broached a range of interesting subjects from the impact of the 2016 election to evaluating the Grand Bargain that is workers’ compensation. Regulatory items were also on the table, and Alex Swedlow, President of the California Workers’ Compensation Institute, presented an interesting session on the state of California.

Mr. Swedlow’s breakout session titled “An Altered State: California’s Post Reform Outcomes and Coming Attractions” outlined SB 863 reforms that have reduced spinal surgeries by 30 percent, decreased prescription medications by 3 percent and the MME (methadone equivalent calculation) by 22 percent. He also spoke about the intent of AB 1124, which should improve quality of care, reduce utilization review (UR) in the first 30 days after injury, and reduce Independent Medcal Review (IMR) friction costs.

But Mr. Swedlow main area of focus, and the one I want to focus on, was the anticipated drug formulary required by AB 1124 (2016). At UR Nation, we have been tracking the DWC’s formulary initiative closely. One reason we are watching this is because we saw how effective the Texas formulary was at stemming the tide of opioid prescribing. The other reason is to get our clients and system partners ready for the California formulary, which goes into effect July 1, 2017. In case you’re a little fuzzy on the specifics, here’s a summary of proposed formulary features that system participants should be aware of:

  • The formulary will subject drugs prescribed or dispensed for outpatient use to the MTUS and formulary, regardless of DOI, on or after 7/1/2017. To avoid prospective review, a drug will have to be a Preferred Drug and dispensed according to MTUS. Prospective review may also be waived by a UR Plan provision of prior authorization.
  • The formulary would not apply to drugs administered to the patient in any clinical setting.
  • For DOI prior to July 1, 2017, the formulary should be phased in, but instead of delaying the effective date for “legacy” claims, it gives physicians the option to:
    • Prepare a treatment plan for transitioning to a Preferred Drug, or
    • Submit a Request for Authorization for the Non-Preferred/Unlisted Drug.
  • All employer/insurer contracts with PBMs or pharmacy networks will be required to make drugs consistent with MTUS and the formulary available to injured workers, with no further restrictions.
  • Off-label use would be allowed if it is consistent with MTUS and the formulary.
  • Compounds would require prospective review.
  • There will be a new “first fill” policy that allows non-preferred drugs to be prescribed for a short period of time without prospective review. The drugs must be prescribed at the initial visit within seven days of the injury and cannot exceed the limit set out in the Drug List. The drug must also be FDA approved and prescribed according to MTUS.
  • AB 1124 creates a Pharmacy and Therapeutics Committee that will work with the Administrative Director to keep the Drug List and related rules up-to-date. The Drug List will be adopted by Administrative Director’s order.

The Formulary/Drug List rules and the accompanying update to MTUS that was just released will, according to Swedlow, have the greatest impact on opioids (the most popular dispensed is hydrocodone – acetaminophen tab 10-325mg), anti-inflammatories and bulk chemicals that are the building blocks of compounds. His noted considerations for UR are:

  • Dose
  • Frequency
  • Delivery System

Looking at the MTUS proposed regulations reveals other interesting facts. The proposed regulations seek to clarify the often confusing “search sequence” when a provider seeks to rebut MTUS’ presumption of correctness. It will also be important for providers to give employers, carriers and UR organizations the necessary medical information to support their drug requests, since the proposed timeframe for formulary prospective review will not include a time extension, which is normally up to 14 days, for requesting additional information.

At UR Nation, we will continue to monitor events in California for more “coming attractions.” Stay tuned as well as we plan to do a quick comparison between the Texas formulary and the coming California formulary. In the comparison, we will state where we think both formularies are getting it right and where improvements can be made.

Kara Larson, Regulatory Manager at UniMed Direct and Guest Contributor to UR Nation