Workers Comp Audit Stress Reducer
Use It For Your Next Premium Audit

Is CMS Overpricing Workers Comp Future Pharmacy Benefits?

Share on facebook
Share on twitter
Share on linkedin

Is CMS Overpricing Workers Comp Future Pharmacy Benefits?

Picture Of Man Workers Comp Future Pharmacy

Does the CMS inflate Workers Comp future pharmacy payouts?   A trend in Workers Comp claim settlements is slowly changing the landscape of closing out files. Many insurance carriers, TPA’s, Captives, etc. are rejecting the Center for Medicare/Medicaid Service’s (CMS) valuation of prescription benefits and just leaving the files open.

We have come across this more often with our client base over the last two years. This article from Business Insurance reinforced what I had thought all along. There are two areas of concern with how CMS calculates the future RX benefit:

  • CMS may not be taking into account that name brand medications will have generic alternatives in the future and price the prescriptions with name brand medications
  • CMS may not take into account the finite period for prescription medications thus projecting all prescriptions as lifetime.

The other concern is with the comment from CMS at a recent congressional hearing that there was a savings incurred of $50 billion over the last ten years. That comment, to me, is highly inaccurate.

The CMS has actually just shifted costs from the government back to the employers which in turn will cause the employers to cost shift the money for Workers Comp insurance premiums or budgets for self insureds. This will cause a lowering of the tax base which in turn will cost the government in the long term.

The CMS may just be attempting to lessen their liabilities, but at what cost? I have been often criticized for saying that the Feds want to control Workers Comp on a national basis. I will cover that next time.

©J&L Risk Management Inc Copyright Notice

Share on facebook
Share on twitter
Share on linkedin

Table of Contents


Is Social Security Disability Affected by WC?

Social Security Disability Does Workers Compensation have an effect on Social Security Disability?  More precisely, do Social Security Disability applications increase when WC payments decrease?

James Moore

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Mgmt Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


Get the latest workers' comp news FREE!

This field is for validation purposes and should be left unchanged.