Gavin: The Mistakes That States Make

Wednesday, January 18, 2017 | 0

As 2017 gets rolling, state legislatures are convening all over the country. Several of them are about to make mistakes in the area of medication management in workers' compensation.  

Michael Gavin

My colleague, Mark Pew, and I have written and spoken extensively on the topic of drug formularies. And we're currently working, formally and informally, with regulators and other stakeholders in jurisdictions across the country on approaches that make sense for employers, doctors, pharmacists and, most importantly, injured workers. While there's not a lot to be gained for any of us in calling out individual states, there's a great deal at stake for all of us in the successes and failures of drug formulary implementations. A failure (perceived or real) in one jurisdiction can lead another jurisdiction to delay its own attempt at a formulary — or to scrap it altogether. 

So how can we tell if a law or rule set is headed in the right direction? Or, alternatively, if a state's efforts are more likely to lead to sub-optimal results? Here's a quick litmus test that you can apply to make your own determination:

1. Will the formulary rely on independent, third-party medical treatment guidelines?  
There's a great deal of industry discussion surrounding this topic, mostly focused on the definition of "evidence-based medicine." While that conversation is interesting, it's not the critical factor in overall formulary success. The crucial questions are twofold: First, will there be room for political influence in the formation of the guidelines? Second, will the guidelines be updated with sufficient frequency?  

2. Does the formulary process build off of existing dispute resolution processes?
States that have successfully implemented drug formularies thus far have done so by relying on existing rules regarding resolution of medical treatment disputes. States that try to simultaneously create a formulary and new dispute resolution processes to support it are, in reality, trying to do two things at once. Not impossible, but certainly creates execution risk. 

3. Does the formulary allow for a remediation period for legacy claims? 
On the one hand, a single effective date creates chaos as employers and physicians try to figure out how to address legacy claims, which tend to be more complicated. On the other hand, applying new rules to new injuries creates two standards of care within a workers’ compensation system, where an injured worker’s treatment plan is driven entirely by the date on which he was injured (which makes no clinical sense). I look for regulatory language that takes a balanced approach — an initial implementation date for new injuries, followed by a remediation period for legacy claims, followed by a fully effective date for new rules and all claims. 

4. Is the formulary process scalable?  
I always look to see if the dispute resolution process can stand up to a significant volume of cases. While the goal of any formulary adoption should be to streamline access to medically necessary medications for injured workers, states should take a "hope for the best, plan for the worst" approach. Dispute resolution processes that rely on one individual or one office for ultimate resolution may lead to bottlenecks and, in a worst-case scenario, undue influence. I always ask myself, what will this look like if there are more disputes than the state expects?  

One bad apple can spoil the bunch. Let's get this right.

Michael Gavin is president of Prium, a medical managed care provider for the workers' compensation industry. This column was reprinted with permission from the firm's Evidence Based blog.