Why Do Docs Dispense Meds to Work Comp Patients?
Wednesday, July 10, 2013 | 0
The Workers Compensation Research Institute report on physician dispensing in Georgia post-reform is stuffed with insights into physician behavior and motivators thereof.
In April 2011, the Peach State capped the price of physician-dispensed repackaged drugs at the AWP of the original, nonrepackaged drug, thereby eliminating the outrageous markups the docs and their enablers were charging employers and taxpayers. WCRI examined prescribing behavior pre- and post-reform; here’s my take on the more interesting results:
- Post-reform, drugs dispensed by docs were still substantially more expensive than the same pills from a pharmacy.
- Dispensing docs are more likely than nondispensing physicians to write scripts for Tylenol, ibuprofen, Aleve, and Prilosec – drugs that can be bought cheaply over the counter.
- Prescribing patterns among dispensing docs changed post-reform to include more expensive versions of similar drugs.
After reform, drugs dispensed by docs cost 20% to 40% more than the same drug bought at a pharmacy, likely because almost all payers use a pharmacy benefit manager, which provides the payer with a big discount on drugs bought at a pharmacy. WCRI: “Because pharmacy benefit managers (PBMs) often contract with pharmacies for discounted prices below AWP, it would not be surprising to see that the pharmacy prices were, on average, lower than the prices paid to physician-dispensers for the same drug.”
As in California post-reform, the price cut by eliminating the up-charge for repackaged drugs did not significantly reduce dispensing: 35% of scripts were dispensed by docs before reform, 28% after.
So, what can we surmise from the data? I’d suggest several things.
Dispensing docs do it for the money. Duh. Despite all the BS about patient care, outcomes, convenience and access, they do it for the dollars.
Here’s proof.
Joe Paduda is co-owner of CompPharma, a consortium of pharmacy benefit managers, and owner of Health Strategy Associates, an employer-consulting firm based in Connecticut. This column was reprinted with his permission from his Managed Care Matters blog.
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