Medical expenditures account for approximately 60% of workers’ compensation claim costs. Pricey topical compounds are now vying for the limelight. Express Scripts reported the average cost for each prescription rose from $90 to $1,100, with around a dozen medications jumping more than 1,000 percent. To put that in context, its clients spent $28 million on compound drugs in 2012, and by 2014 that payout was roughly $171 million.
Not only are compound drug costs skyrocketing, but the industry is also seeing related litigation expenses adding to the hefty price tag. Patient safety issues in the use of topical compounds continue to be troublesome as topical compounds are neither tested nor approved by the FDA.
CompPharma’s 12th Annual Survey of Prescription Drug Management in workers’ comp shows drug management as more important than any other medical issue. And the majority of survey respondents indicated compounds are the most concerning of all drugs.
Controlling costs while ensuring care is safe and medically appropriate can be a complex and frustrating process. While health care organizations outside of the workers’ compensation industry can refuse to pay for these compounds, workers’ comp payers are often bound to reimburse providers, therefore compound companies are now turning to workers’ comp as the next potential golden goose.
Evidence-based guidelines – what are they worth to you?
Science tells us through proven trials that it is dangerous to mix bleach with ammonia, as it creates a toxic gas that can cause serious harm when inhaled. It also tells us that when taking some prescription or over-the-counter drugs, drinking grapefruit juice can increase drug absorption that could potentially result in a lethal overdose. Without evidence-based guidelines in place to support the safety and efficacy of compounded topical creams or gels, patients become human experiments, and they can suffer the repercussions when an adverse reaction happens. This was the case of the California woman’s baby died after a topical compound cream the mother was using came in contact with the baby.
Utilization review – a critical safeguard
Compounded topicals continue to become more complex and have escalated in cost by 225 percent over the last few years. Glen Stettin, senior vice president for clinical, research and new solutions, states “For nearly all of these products, there’s a commercial preparation already available – a generic or brand-name product approved by FDA and there is no evidence to support their use at all.” Joseph Paduda, a recognized expert in managed care, shared in a recent article about compound drugs, that without regulations in place and a strong utilization review program supported by evidence-based guidelines, compounds will continue to cause problems.
Costs of topical compounds are spiraling, evidence to support their use is almost non-existent and the FDA neither tests nor approves them. Yet their use continues to rise. It is time to put the cards on the table – who is protecting the patients against unproven treatments?
Medical harm is a major cause of suffering and disability, and it is the third leading cause of death in the United States. While the U.S. spends more on healthcare than any other country, our spending is not buying us particularly safe care. A strong utilization review program in combination with evidence-based guidelines is essential to ensure recommended treatment is medically appropriate and to safeguard patients from treatment that can cause them harm.