Pharmacy Issues in the Texas Workers' Compensation System

1
Pharmacy Issues in the Texas Workers'
Compensation System
2
Todays Discussion

• Utilization and Reimbursement
• Labor Code
• Occupations Code
• Existing Division Rules
• Pharmaceutical Fees - 134.500 134.506
• Preauthorization, Concurrent Review and Voluntary
  Certification of Health Care - 134.600
• Treatment Guideline - 137.100
• Pharmacy Rule Development
• Closed Formulary
• Pharmacy Fee Guideline

3
Payments in the Texas Workers Compensation
System - 2006
4
Pharmaceutical Utilization and Payments by
Therapeutic Classification Group for
Prescription Year 2006
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2007. Note The 7 selected groups are the most
frequently utilized groups (79 of all
prescriptions) in the Texas WC system. The Other
Groups are the remaining 82 less frequently
utilized groups (21 of all prescriptions).
Note Total number of Injured Employees
include duplicates since each employee could
receive prescriptions from multiple therapeutic
classification groups.
5
Estimated Pharmaceutical Reimbursement by Class,
CY 2007
Total Payments -135,039,150
6
Informal Working Draft Rules

• 134.500 Definitions (Revised)
• 134.506 Outpatient Drug Formulary (Proposed to
  be Repealed)
• 134.507 Outpatient Drug Formulary Closed (New)
• 134.508 Use of the Closed Drug Formulary for
  Claims Not Subject to Certified Networks (New)
• 134.509 Use of the Closed Drug Formulary for
  Claims Subject to Certified Networks (New)

7
Informal Working Draft Rules
Primary points of interest

• Definitions
• Description of the Closed Formulary
• N Drug listing
• Preauthorization/Appeals Process
• Retrospective review
• Applicability Implementation
• Initial Pharmaceutical Services
• Use of the Closed Drug Formulary for Claims
  Subject to Certified Networks (134.509)

8
IWDR Closed Formulary (informal rule)
Closed Formulary includes ALL FDA approved drugs
except
Compounds that include drugs w/ status N
Investigational or Experimental Drugs
Drugs w/ status N
9
ODG Appendix A (example)
10
IWDR Basic Decision Tree
NO
NO
NO
Closed Form Apply to DOI?
Initial Fill?
Preauth 413.014?
Yes
Yes
Yes
Fill Script
Preauthorization Reconsideration MDR-IRO
Yes
N Drug?
NO
Retrospective Review
Fill Script
11

• ODG - Treatment in Workers Comp
• Adopted in December 2006
• Applicable May 2007
• Recommendations in the treatment summaries
• Pain Chapter includes specific detail concerning
  the use of opioids

12

• Legacy Claims
• Loosely defined during the development of the
  closed formulary as active claims that are more
  than one to two years post DOI and are utilizing
  N drugs.

13
Legacy claims with prescription activity in CY
2008
14
Pharmacy Payments CY 2007 Based on DOI
15
Total N Drug Payments for CY 2007 by Injury Year
Total N Drug Payments 23,816,329.78
16
(No Transcript)
17
Next Steps in Pharmacy Rule Development

• Pharmacy Closed Formulary
• Proposal
• Adoption
• Implementation
• Fee schedule development
• Research including AWP implications
• Informal working draft rules
• Stakeholder input
• Proposal
• Adoption
• Implementation

18

• Questions and Comments

19
Division Resources
Dr. Howard Smith, Medical Advisor 512-804-4409 C
hris Voegele, Health Care Policy 512-804-4856 Chr
istopher.Voegele_at_tdi.state.tx.us Ruth
Richardson, Health Care Policy 512-804-4850 Ruth.
Richardson_at_tdi.state.tx.us