A tale of_2_companies_final

A Tale of 2 Companies

Jim Andrews Senior Vice President, Pharmacy Services,

Healthcare Solu=ons

Dave Smith Divisional Vice President, Risk Management,

Family Dollar Stores

Michael Gavin Chief Strategy Officer, PRIUM

Ron Mazariegos Claim Execu=ve, Arrowpoint Capital

1

Learning Objec>ves

1.  Highlight opioid management methods available to employers

2.  Learn how and when to leverage clinical tools and medical and legal strategies to curtail abuse of prescrip=on drugs

3.  Describe the importance of collabora=on between workers’ compensa=on payers and pharmacy benefit managers

2

Disclosure Statement

•  Jim Andrews has no financial rela=onships with proprietary en==es that produce health care goods and services.

•  Dave Smith has no financial rela=onships with proprietary en==es that produce health care goods and services.

•  Michael Gavin has no financial rela=onships with proprietary en==es that produce health care goods and services.

•  Ron Mazariegos has no financial rela=onships with proprietary en==es that produce health care goods and services.

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Third Party Payer Track: A Tale of Two Companies

April 2 – 4, 2013

Omni Orlando Resort

at ChampionsGate

Jim Andrews, R.Ph. Healthcare Solu=ons EVP of Pharmacy Services

Dave Smith Family Dollar Stores, Inc. Divisional VP of Risk Management

Disclosure Statement

Jim Andrews, EVP of Pharmacy Services with Healthcare Solu<ons, and Dave Smith, Divisional VP of Risk Management with Family Dollar, have no

financial rela<onships with proprietary en<<es that produce health care goods and services.

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•  Introduc=ons and corporate overviews

•  The na=onal challenge: opioid abuse epidemic

•  Three steps to fight drug abuse

•  How Family Dollar is mee=ng the challenge

–  Three phases of program development

–  Program results

–  CPRx™ -‐ Medicare Set-‐Aside (MSA) case studies

•  The future of pharmacy benefit management

Topics of Discussion

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•  54 year anniversary •  Fortune 300 company •  7,700+ stores

–  “Small Box”

–  One new store every 17 hours –  1 to 3 team members staff the stores

–  1 billion customers per year

•  11 distribu=on centers •  45 states •  55,000 team members •  Annual sales in excess of $10 billion

Family Dollar Stores, Inc. Corporate Overview CharloMe, NC based stores offering quality merchandise at everyday low prices,

in easy-‐to-‐shop neighborhood loca>ons

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Healthcare Solu>ons, the parent company of Healthcare Solu>ons, ScripNet & Procura Management, is a health services company delivering technology-‐based solu>ons to the workers’ compensa>on & auto casualty markets.

Healthcare Solu>ons Corporate Overview

Pharmacy Benefit Management (PBM) Program Stringent cost and u/liza/on management controls produce maximum program savings, efficient claims handling & op/mal clinical outcomes.

Prospec>ve Concurrent Retrospec>ve

•  Network Management

•  Outreach/Enrollment Services –  First Fills & Dynamic

Enrollment –  Card Administra=on

with Persistent Outreach

–  Conversion to Home Delivery

•  Regulatory & Compliance Oversight

•  Customized Formularies

•  POS Administra>on –  Generic Enforcement –  ProDUR Rx™ / Clinical

Edi=ng –  Prior Authoriza=on

Management

•  Rx360™ –  Paper Bill Management –  Physician Dispensing –  Compound & Re-‐

Packaged Drugs –  Non-‐Retail Network

Billing

•  Clinical Rx™ –  Academic Detailing –  Therapeu=c

Subs=tu=ons –  Narco=cs Management –  Drug Urinalysis Tes=ng –  Physician Reviews

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–  850+ employees –  750+ valued customers –  URAC accredited –  SSAE 16 compliant –  30% revenue growth year over year –  End-‐to-‐end WC solu=ons

8

Iden/fy: Substance Abuse is an Epidemic

•  8.7% of the American popula=on used an illicit drug or prescrip=on drug non-‐medically in the past month1

•  2.4% of the American popula=on used prescrip=on drugs non-‐medically in the past month1

–  Pain relievers: 4.5 million

–  Tranquilizers: 1.8 million

–  S=mulants: 970,000

–  Seda=ves: 231,000

•  In 2010, there were more deaths related to drug overdoses than motor vehicle crashed for the first =me2

•  Among the prescrip=on drug deaths, opioids are involved in close to 75%3

Sources: 1 Source: Substance Abuse and Mental Health Services Administra=on, Results from the 2011 Na<onal Survey on Drug Use and Health: Summary of Na<onal Findings, NSDUH Series H-‐44, HHS Publica=on No. (SMA) 12-‐4713. Rockville, MD: Substance Abuse and Mental Health Services Administra=on, 2012. 2NCHS Data Brief, December, 2011. Updated with 2009 and 2010 mortality data. 3CDC, Na=onal Center for Health Sta=s=cs, Na=onal Vital Sta=s=cs System.

Non-‐medical use = use without a prescrip/on of

the individual's own or simply for the experience or feeling the drugs caused

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•  75% of all adult illicit drug users are employed

•  38% to 50% of all workers’ compensa=on claims are related to substance abuse in the workplace

•  When compared to non-‐substance abusers, substance-‐abusing employees are more likely to be involved in a workplace accident

•  Substance abusers file three to five =mes as many workers’ compensa=on claims

•  Opioid abusers generate, on average, annual direct health care costs 8.7 =mes higher than nonabusers2

Sources: Why You Should Care About Having A Drug-‐Free Workplace Fact Sheet. Drug-‐Free Workplace Kit. U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administra=on.

'Working Partners', Na=onal Conference Proceedings Report: sponsored by U.S. Dept. of Labor, the SBA, and the Office of Na=onal Drug Control Policy. Substance Abuse and Mental Health Services Administra=on, Center for Behavioral Health Sta<s<cs and Quality, Na<onal Survey on Drug Use and Health, 2007 – 2010 2White AG, Birnbaum, HG, Mareva MN, et al. Direct costs of opioid abuse in an insured popula=on in the United States. J ManagCare Pharm 2005;11(6):469-‐479.

Iden/fy: Substance Abuse among the Employed

Preven/ve Measures: Pre-‐employment and employment drug tes=ng

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Diversion from only one doctor

5.5%

81.6%

5.7% 2%

1.9% 1.3%

3.1% .2% .2% .3%

54.2%

18.1%

16.6%

4.8% 3.9%

4.2%

1.9% .3% .2%

.2%

From Friend or Rela=ve for Free

From One Doctor

Bought from Friend or Rela=ve

Took from Friend or Rela=ve without Asking

Bought from Drug Dealer or Other Stranger

Some Other Way

From More Than One Doctor

Bought on the Internet

Wrote Fake Prescrip=on

Stole From Doctor's Office, Clinic, Hospital, or Pharmacy

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Source: Substance Abuse and Mental Health Services Administra=on, Results from the 2011 Na<onal Survey on Drug Use and Health: Summary of Na<onal Findings, NSDUH Series H-‐44, HHS Publica=on No. (SMA) 12-‐4713. Rockville, MD: Substance Abuse and Mental Health Services Administra=on, 2012.

Source of Prescrip>on Pain Relievers Used Non-‐medically

Source When Obtained by Friend or Rela>ve

Iden/fy: Aberrant Behavior linked to Abuse/Diversion

Iden/fy: Heavily Abused Medica>ons

Top Abused Medica>ons1

2009 WC Rank by Cost2

2010 WC Rank by U>liza>on3

Controlled Substance

Oxycodone 1 5 CII

Alprazolam Not in top 50 33 CIV

Hydrocodone 3 1 CIII

Methadone Not in top 50 53 CII

Clonazepam Not in top 50 38 CIV

Lorazepam Not in top 50 58 CIV

Carisoprodol 18 15 CIV

Morphine 38 29 CII

Zolpidem 21 17 CIV

Diazepam Not in top 50 22 CIV

Fentanyl 13 28 CII

In 2011 there were 483,000 new non-‐medical users of

OxyCon>n4

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1: 2008: Na=onal Es=mates of Drug-‐Related Emergency Department visits, Office of Applied Studies, Substance Abuse and Mental Health Services Administra=on, 2011 2: Lipton B, Laws C, and Li L. Workers Compensa=on Prescrip=on Drug Study: 2011 Update. NCCI. August 2011 3: Healthcare Solu=ons Data 4: Substance Abuse and Mental Health Services Administra=on, Results from the 2011 Na<onal Survey on Drug Use and Health: Summary of Na<onal Findings, NSDUH Series H-‐44, HHS Publica=on No. (SMA) 12-‐4713. Rockville, MD: Substance Abuse and Mental Health Services Administra=on, 2012

14 14

2012 Healthcare Solu=ons Drug Trends Report

Developing Claims

Iden/fy: Drug Mix Differences in Claim Age

Mature Claims

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96 mg/person in 1997

698 mg/person in 2007 Enough for every American to take 5mg Vicodin every 4 hrs for 3 weeks

National Vital Statistics System, multiple cause of death data set and Drug Enforcement Administration ARCOS System Report of the International Narcotics Control Board for 2005. United Nations, NY. 2006 Laws C,. Narcotics in Workers Compensation Drug Study: 2012 Update. NCCI. May 2012

The share of claims receiving narcotics within one year after injury has increased

Iden/fy: High Opioid U>liza>on

Communicate: Predic>ve Markers in Opioid Therapy

Opioid use in first 15 days

↑  Disability dura/on ↑  Medical costs ↑  Risk of surgery (3 fold) ↑  Late opioid use (6 fold)

When 2 or more prescrip>ons for opioids present

↑  Costs ↑  Lost /me from work ↑  Dura/on of paid temporary disability ↑  Indemnity ↑  AQorney involvement ↑  Open claim

Opioids with over 100 morphine equivalents

per day

↑  Accidental overdose ↑  Morbidity and mortality (8.9 fold)

Source: Swedlow A, Gardner LB, Ireland J, Genovese, E. Pain Management and the Use of Opioids in the Treatment of Back Condi=ons in the California Workers’ Compensa=on System. CWCI June 2008

Webster BS, Verma SK, Gatchel RJ. Rela=onship Between Early Opioid Prescribing for Acute Occupa=onal Low Back Pain and Disability Dura=on, Medical costs, Subsequent Surgery and Late Opioid Use. Spine. 2007. 32 (19) 2127-‐2132.

Bohnert AS, Valenstein M, Blair M, et al. Associa=on Between Opioid Prescribing Paterns and Opioid Overdose-‐Related Deaths. JAMA. 2011 305:1315-‐1321 16 16

Communicate: Early and High Dose Opioid Use

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Changes in Narco>c Potency in Daily Morphine Equivalents as a Claim Ages

Source: Laws C. Narco=cs in Workers Compensa=on. NCCI. May 2012 2012 Healthcare Solu=ons Trends Report

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Coordinate: Best Prac>ces in Opioid Therapy

Con>nued Opioid Therapy

Conversion to Long-‐Ac>ng Opioid

Opioid Rota>on

Alterna>ves to Opioid Therapy

Exit Strategy Pa>ent

Reassessment

Trial of Opioid Therapy

Ini>al Pa>ent Assessment

Pa>ent Selec>on

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•  CPRx™ program uses licensed, prac=cing physicians to review injured workers’ medical and prescrip=on histories

•  Physicians examine: – Appropriateness of regimen to diagnosis –  Long-‐term pharmacological effects –  Poten=al drug interac=ons – Denial or approval of current regimen –  Pa=ent compliance – Relatedness of regimen to claim

•  Automated reports provide recommenda=ons for CPRx based on weighted red flag triggers

•  Follow-‐up by telephonic nurse support helps to ensure compliance with the agreed upon changes to the injured worker’s medica=on therapy plan

Coordinate: Physician Interven>on

37%

24%

11%

16%

12%

Drug Decisions

Wean

Approved

Confirmed DC

Discon=nue

Unrelated

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Mee<ng the Challenge: Family Dollar’s Pharmacy Benefit Management Program

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Casualty Claims Profile

Annually

•  8,400 workers’ compensa=on (WC) incidents

–  1,400 pending

•  10,800 general liability incidents

–  1,250 pending

Most expensive claim in the past 10 years

•  2003 WC claim: $3.2 million

–  $2 million in pharmacy

Annual loss pick

•  ~$80 million

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Mee>ng the Challenge: Three phase program to fight WC drug abuse

Assessment 2007

Program Design

2008 -‐ 2011

CPI Phase I

Phase II Phase III

Best Prac>ces

Refinement/MSAs Proac>ve/Opportuni>es

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Phase One: WC Medical Assessment

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•  Total WC medical spend was 51% of total claim

•  Prescrip=on cost was 21% of total WC medical spend

Measurement

•  Industry benchmark •  PBM reports •  Ourselves

Expert Partners

Goals

Family Dollar 2007

Benchmarking

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Phase Two: Pharmacy management program design

Assessment 2007

Program Design

2008 -‐ 2011

CPI

Phase I •  Healthcare Solu=ons 2008 •  Sedgwick 2009 •  Low hanging fruit

Phase II •  Pharmacy nurse

•  Formulary management (tradi=onal and non-‐subscriber)

•  Ac=ve prescrip=on review •  MSAs/forensics

Phase III •  GL MSAs •  California custom MPN •  Health and wellness •  Health insurance •  Legacy claims

Phase I Best prac>ces

Phase II Refinement/MSAs

Phase III Proac>ve management/ opportuni>es

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Family Dollar CPRx™ Results Physician interven>on program

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CPRx Program Summary

Number of CPRs Completed 18

Total Number of Drugs Reviewed 112

Drugs Not Recommended by Reviewer 82% of drugs

Discussion Rate 69% of drugs

Trea=ng Physician and Reviewer in Agreement 60% of drugs

CPRs with Agreement to make a change 50% of CPRs

Actual ROI To-‐Date $4.31 : $1

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CPRx Case Study # 1

Injured team member

•  46 year old female with November 29, 2008 DOI

•  Low back injury with previously failed fusion surgery and failed injec=on trials

•  Prescrip=on drug cost to date: $16,159 •  Prescrip=on drug therapy:

–  Cyclobenzaprine -‐ muscle relaxant –  Endocet -‐ opioid / pain medica=on –  Fentanyl (generic Duragesic Patch) – opioid / pain medica=on –  Meloxicam – NSAID –  Tramadol – opioid / pain medica=on

Resolu>on: All medica>ons discon>nued. Tramadol is the only drug filled in the previous 6 months and was last filled in November 2012

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CPRx Case Study # 2

Injured team member •  41 year old male with May 11, 2010 DOI •  Pa=ent was lixing several cases when he strained the lex side

of his lower back •  Prescrip=on drug cost to date: $23,115 •  Prescrip=on drug therapy:

–  Gabapen=n – an=convulsant / neuropathic pain –  Kadian – opioid / pain medica=on –  Norco – opioid / pain medica=on –  Relistor – cons=pa=on medica=on –  Cymbalta – An=depressant / neuropathic pain –  Neuropathic cream – topical analgesic

Resolu>on: Gabapen>n, Relistor and Cymbalta have been discon>nued. Kadian has been switched to the generic, morphine sulfate and reduced in quan>ty since December, 2012

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Family Dollar’s Success

•  Total WC medical spend was 51% of total claim

•  Prescrip=on cost was 21% of total WC medical spend

•  Family Dollar’s goal: reduce pharmacy spend to 14%

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•  Pharmacy costs are 19.5%

•  Average medical expense is 60% of the total WC claim cost

•  Total WC medical spend is 37.8% of total claim expense (25% reduc=on from 2007)

•  Prescrip=on costs are 11.7% of total WC claim expense (48% reduc=on from 2007)

•  Family Dollar’s current goal is to reduce pharmacy spend to 9%

•  Medicare Set-‐Aside savings of $2,808,616

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Assessment 2007

Program Design

2008 -‐ 2011

CPI Phase I

Phase II Phase III

Best Prac>ces

Refinement/MSAs Proac>ve/Opportuni>es

Mee/ng the Challenge: Where Is Family Dollar in the Three Stage Process?

2013

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Phase Three: Con>nual Process Improvement (CPI)

Explora>on of opportuni>es

•  Maintain sen=nel effect on u=liza=on and cost trending

•  Monitor jurisdic=onal regula=on

•  Iden=fy opportuni=es

–  Legacy claims

–  Jurisdic=onal MPN expansion

–  Corporate culture

–  Health insurance

–  Educa=on and training

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Review

Monitor Modify

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Family Dollar’s Con>nuing Opportuni>es

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WC Medical Profile

2-‐28-‐2013

Open WC claims 1,397

Total incurred losses

$125 Million

2013 trended medical expense:

$48 Million

2013 trended pharmacy expense:

$4.3 Million

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Transac>onal Services Analy>c Services Strategic Services

Impa

ct on Program Effec>vene

ss

Impact on Expenditures

Strategic Services •  Customized strategy development •  Regulatory/compliance oversight

•  Program/product development •  Outcomes measurement

Analy>cal Services •  Program benchmarking •  Quality measurement

•  Ad hoc repor=ng •  Formulary management •  Clinical management

•  Transac=onal audi=ng •  State repor=ng

Transac>onal Services •  Card administra=on •  POS processing

•  Home delivery •  Paper bill processing •  Call center support

•  Payment and billing •  Network administra=on •  Provider communica=ons

The Future of Pharmacy Management

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Jim Andrews, R.Ph. Healthcare Solu=ons EVP of Pharmacy Services Jim.andrews@healthcaresolu=ons.com

Dave Smith Family Dollar Divisional VP of Risk Management [email protected]

Thank You

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Arrowpoint Capital •  150-‐year-‐old organiza=on •  Acquired US opera=on of Royal & SunAlliance USA in 2007 •  Experience in run-‐off insurance business •  “Redefining success” by developing and execu=ng

comprehensive solu=ons to manage claims and sa=sfy policyholder obliga=ons.

Claim Resolu>on Results Ac>ons Assessment

•  Iden>fied, capitalized on rapid resolu>on opportuni>es

•  Centralized claim management

•  Enhanced data tracking and repor>ng through the Data Hut

•  Ensured ‘best prac>ce’ claims handling with full-‐service capabili>es, cross-‐func>onal interac>on

•  Implemented li>ga>on management strategy • Cost controls through reduc=on in law firms • Re-‐engineered legal bill process – flat fees • Specialized technology

•  Introduced new TPA management func>on

•  Outsourced specialized func>ons • Medical case management •  Inves=ga=on services • Subroga=on and recovery

•  Reduced inventory by 92% to <12,000 maMers

•  Streamlined and centralized physical office loca>ons to 1

•  Developed a standardized claim transfer and integra>on process from underperforming TPAs and disposals

• Transi=oned 4,000 claims to direct handling

•  Converted >15,000 legal files from >me-‐and-‐expense to flat fee

•  Improved data sharing, analysis, review, profiling and segmenta>on

•  Leveraged a mul>-‐disciplinary approach to handling complex maMers

•  Retained key staff and cri>cal knowledge

•  Inventory of 121,000 claims, including: • >35,000 workers comp cases handled by 403 adjusters

• >10,000 cases in li=ga=on handled by 10 offices

•  Staff located in 29 offices

•  Bi-‐furcated, mul>-‐layered management structure with liMle governance and control

•  Several high-‐cost specialized internal units

•  Lack of comprehensive data-‐sharing capabili>es, tools

•  >3000 external lawyers handling claims with hourly billing

•  >80 TPAs with services cos>ng $10m annually

•  Limited interac>on with Actuarial, Reinsurance, other func>ons

Claim Resolu>on Strategy

Key Drivers

•  Medical Management

•  Claim Inves=ga=on

•  Legal Strategy •  Setlement Ini=a=ves

•  Li=ga=on Management •  Data Management

Medical Management = Data Management

Iden=fica=on and segmenta=on of high value, high exposure claims:

•  Age of claimant •  Occupa=on •  Type of injury •  Current medical treatment •  Current Rx regimen •  Future recommended medical treatment (i.e., spinal injec=ons, physical

therapy, surgery)

•  Unrelated co-‐morbidi=es and condi=ons •  Medical provider discipline •  Setlement Opportunity

–  Indemnity –  Medical –  Both –  MSA or not

Medical Management -‐ Tools PRIUM

•  U=liza=on Reviews •  Comprehensive Clinical Assessments •  Medical Director Reviews

PMSI – Pharmacy Benefit Management Vendor

•  Peer-‐to-‐Peer Reviews •  Durable Medical Equipment •  Drug Monitoring Program

G4S – Inves>ga>ons

MHayes – Cer>fied Case Management

Crowe Paradis – Medicare Vendor

•  Medicare Set-‐Asides •  Condi=onal Liens

Atlas – Structured SeMlement Vendor

Medical Management -‐ Adjuster Ensure ongoing communica>on with the aMending physician regarding the medical treatment being rendered to the injured worker (where permiMed):

•  Clearly defined and updated treatment plan?

•  Drug Monitoring – Urinary analysis, pill counts, patch counts

•  Narco=c Agreement in place?

•  Conference calls with the trea=ng provider, face-‐to-‐face scheduled mee=ngs with the provider and/or the IME physician.

•  Understand the applicable state guidelines and evidence-‐based medicine (i.e., ODG, ACOEM).

•  Outreach leters to the provider – referencing guidelines

•  Con=nuous medical educa=on – Lunch & Learns, Summits, etc.

Medical Management – State Specific CA -‐ Establishment of Specifically Designed Medical Provider Network (MPN) and Pharmacy Benefit Network (PBN) •  EK Health – Medical Provider Network •  PMSI – Pharmacy Benefit Manager

TX -‐ ODG N-‐Drug Project •  PRIUM ₋  No=fica=on to the injured worker and prescribing physician of the Closed Formulary changes to take place on September 1, 2013. ₋  Conference calls with the prescribing physician with Claims on conference call. ₋  Follow up writen agreements to wean and change treatment plans.

DE -‐ Ensuring Prescrip>ons are Filled In-‐Network •  Boone vs. SYAB Services, 2012 Del. Super. LEXIS 407 – The Delaware Superior Court held that the Delaware Industrial Accident Board had the authority to require a claimant to use an employer’s preferred prescrip>on plan rather than receive medica>ons via physician dispensing.

•  Leters to providers, claimants and counsel advising them will not pay for out-‐of-‐network Rx.

PA – UR of Highly Addic>ve Narco>cs on Chronic Opioid Claimants •  Bedford Somerset MHMR v. Workers' Comp. Appeal Bd. (Turner), 51 A.3d 267; 2012 Pa. Commw. LEXIS 261 (2012): The Appellate Court reversed the full Board’s decision and reinstated the the WCJ decision which determined the highly addic=ve nature of the Fentanyl lozenges as evidenced by Claimant's increased use of the medica=on and rendered it unreasonable and unnecessary where an alterna>ve treatment plan could be implemented.

Claim Inves>ga>on •  SONAR (Specialized Online Networking Advanced Research)/Social Media

•  Claim Index Bureau every 6 months

•  Surveillance (when appropriate)

•  Criminal Background

•  DMV

•  Dunn & Bradstreet

•  State Records

•  Area Canvas

•  Alive and Well (leter vs. in person)

•  Con=nuance of Disability (in person)

Claim Inves>ga>on in Ac>on •  Claimant residing in Florida travels to Long Island, NY once a year to see his

doctor and get prescrip=ons filled.

•  Doctor writes three-‐month refills of Oxycon=n and Vicodin and fills via phone call from claimant to front desk.

•  No visit, no examina=on. No evidence of drug monitoring (urinary analysis, pill counts, narco=c agreement) being performed.

•  When asked why drug monitoring tools not being used, doctor becomes extremely defensive.

•  SONAR inves=ga=on ini=ated (medical record review and Peer-‐to-‐ Peer).

•  CCA – medical records indicate claimant unable to func=on.

•  BUT . . .

Claim Inves>ga>on •  SONAR Inves=ga=on yields claimant’s Facebook photos

SeMlement Ini>a>ves •  Over 300 New York claims reviewed and targeted for resolu=on.

•  Setlement counsel retained to perform claim data analysis, provide claim file review and assessment, and handle all logis=cal/back-‐office aspects.

•  Conferences scheduled at various Workers’ Compensa=on Boards throughout New York – Manhatan, Long Island, Peekskill, and Syracuse.

It Takes a Village. . .

On-‐site team •  Defense counsel (jurisdic=onal knowledge) •  Setlement counsel •  MSA service provider •  Structured setlement vendor •  Claims Management

Feed them and they will come!

SeMlement Ini>a>ves •  Adver=se – Differen=ate •  Adver=sed on the NY Injured Workers’ Bar website as well as the

various Boards.

•  134 invitations   *61 RSVP’s   2 no-show

•  6 settled before initiative began

•  3 were not settled

Don’t just send leter! Call, Fax, Email

Medical/Legal Summit •  Three summits held to date.

•  Approximately 120 insurance, legal, and medical professionals and consultants from around the country gathered for Arrowpoint Capital’s 2012 Medical/Legal Summit in mid-‐June 2012.

•  More than 30 defense counsel from 23 law firms atended from states as far away as California, Wisconsin, and New Hampshire.

•  Presenters included Arrowpoint’s WC claims management team, along with delegates from some of its WC claims service provider partners, and na=onally recognized expert Dr. Andrew Kolodny.

Medical/Legal Summit Topics

•  Medical treatment and alterna=ve therapies for trea=ng chronic pain, coordina=on of care, figh=ng fraud inside the pill mill, monitoring long-‐term opioid use, Medicare and secondary payer rules and regula=ons, and Key States

•  Medical treatment updates

•  “Ask a Doctor”/ “Ask a Pharmacist”/ “Ask a DME Specialist” / “Ask a Registered Nurse” sessions

•  Actual case studies presented by each team on the Summit’s last day

Selec>on of Counsel •  Defense Counsel vs. Setlement Counsel

•  Develop Resolu=on Strategies

•  Stay informed! Review recent case law and statute updates.

•  In NY, use the law to your favor, e.g., Labor Market Atachment, Medical Treatment Guidelines, RFA, C8.1.

•  Conduct discovery! Deposing the atending physicians, claimants and other witnesses can yield useful informa=on.

•  Appor=onment/subroga=on/third-‐party ac=ons

•  Consult ODG and ACOEM Guidelines

•  Conduct IME’s, UR’s

PRIUM •  Established in 1987 primarily as a u>liza>on review organiza>on

–  Perform UR na=onwide and this remains a core competency

–  Experience in u=liza=on review allows for a unique perspec=ve on both medical and legal avenues

–  Work primarily within the Workers Compensa=on space, but also do liability

•  Recogni>on and shiy towards pharmaceu>cal therapy

–  Recognized overprescribing in the early 2000’s

–  Developed a product line of reviews to help combat the issue

–  Focus on physician led interven=on with peer-‐to-‐peer reach out

  Co-‐morbidi>es   Growing in number and complexity

  Each one gets its own drug!

  Lack of predictability in claims management   Who can handle 90 days of hydrocodone without issues?

  Who will end up dependent on the medica=on?

  Culture of over-‐treatment   Reimbursement methodology favors treatment over preven=on

  Interven=onal procedures (vs. cogni=ve medicine) drive economics

  Influence of big pharma   Total sales of Oxycon=n in 1996: $45 million

  Total sales of Oxycon=n in 2009: $3 billion

  Statutes: Laws passed by legislators and signed by governors

  Regula>ons: Rules developed by regulatory agencies

  Case Law: Judicial decisions resul=ng from challenges to either statutes or rules/regula=ons or from the dispute resolu=on process

  Ex Parte Communica>on

  Medical Treatment Guidelines

  U>liza>on Review / IME

  Directed Care

  Physician Dispensing

  Prescrip>on Drug Monitoring Programs (PDMPs)

  “Prohibited”: Mississippi, Illinois, New Mexico, Colorado, Connec>cut, South Dakota

  Restricted: Nevada, New Hampshire, Alaska, Minnesota, North Carolina, South Carolina

  All other jurisdic>ons: No restric>ons on interac>ng with trea>ng physicians

  Evidence-‐Based, Na>onally Recognized (e.g., ODG, ACOEM)   Texas

  California

  Hawaii

  Kansas

  Missouri

  Consensus-‐Based, Locally Developed:   Arkansas

  Colorado

  Connec=cut

  Delaware

  Louisiana

  Nevada   New Mexico

  North Dakota   Ohio

  Maryland   Maine

  Massachusets

  Minnesota

  Montana

  Oklahoma   Utah   Vermont

  Wyoming

  New York   Oregon   Rhode Island   Washington

  West Virginia Arizona, Tennessee: Under considera<on

  Statutorily Required and/or Recognized: 22 states with 17 of those statutes lending some real authority for the payer

  Medica>on-‐specific: Texas, Tennessee, Washington, West Virginia, Ohio

  Case Study: Texas   Statute: HB 7 passed in 2005   Rules: Texas Administra>ve Code Title 28, Part 2, Chapter 134,

Subchapter F, Rule 134.500

Open Formulary for DOI prior to 9/1/11

Closed Formulary for DOI a^er to 9/1/11

9/1/11 9/1/13 Open Formulary for all DOI

Closed Formulary for all DOI

Two year remedia<on period for legacy

claims

Ini<al results: 60%+ drop in N drug scripts

  Considera>ons:   Claim life cycle

  Networks

  Panel-‐driven

  Regulatory order of opera=ons

  Fundamental Goal   Don’t overlook an opportunity to remove an injured worker from the care of a physician

that is failing to provide evidence-‐based care

  Prohibited:   Massachusets   New York

  Texas

  Arkansas   Florida

  Louisiana

  Maryland

  Minnesota

  New Jersey

  Connec=cut   Indiana

  Illinois

  Arizona   California

  Georgia

  Illinois

  Maryland

  Michigan

  North Carolina

  Pennsylvania

  South Carolina

  Tennessee

  Virginia

  Wisconsin

  Restricted:

  Allowed:   Silent:

Source: WCRI Study, July 2012

Recommenda<on: Focus on pricing, not prac<ce

  No Program:   Missouri

  Mandatory Use of PDMP by Physician/Prescriber:   Kentucky   Massachusets (first script for schedule II or III drug only)

  Status:   43 states have programs up and running   6 addi=onal states have programs authorized, but not yet func=onal

Statute/Rule Op>mal for Limi>ng Rx Drug Overu>liza>on

Your State?

Ex Parte Communica=on

Allowed, no restric=ons ?

Medical Treatment Guidelines

Na=onally recognized guidelines mandated

?

U=liza=on Review Mandatory UR ?

Direc=on of Care Allowed ?

Physician Dispensing Restricted pricing ?

PDMP Program in place; Mandatory search prior to Rx

?

  Have a Plan B: Collegial engagement doesn’t always work... know what your op=ons are if voluntary engagement fails.

  Physician Engagement: Do not assume the trea=ng physician is the enemy... un=l the trea=ng physician is the enemy.

  Follow up, follow up, follow up: Engagement is not a “one =me” event... treatment changes are difficult and must be monitored.

  Leverage technology: PBMs can help to closely monitor and customize medica=on regimens... use the technology available!

A tale of_2_companies_final

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