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Workers Comp Prescription Analytics – NCCI Says Cost Dropped

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2012 – 2022 Workers Comp Prescription Analytics Shows Reversing Trend

The Workers Comp Prescription Analytics Report released by NCCI today shows that prescription costs per claim have flat-lined or decreased in many states over the last decade.  Take five minutes and look over the article – worth your time.  The article can be found at this link.

The irony here is the series of four studies were centered on covering medical cost inflation.  See my comments at the end of this article on why I think the cost decrease occurred nationwide.  You can also see what I said concerning 2014 Rx costs here.

Three of the nice things about the way NCCI sets up its articles are:

  • Sliders to break the workers comp prescription analytics down by state (Nice!) If any underwriter, risk manager, or claims person wanted to see how the jurisdictions they cover have decreased/increased, they are just a couple of clicks away from charts/data.
  • An authors’ button at the top right of the article introduction page (see here) to send questions directly to the study’s authors.  From my experience, they do get back to you not long after you pose a question or comment.
  • Cristine Pike, Communications Director is another great source if you have any questions/comments.
NCCI Chart workers comp prescription analytics last decade
(c) NCCI, Boca Raton, FL

Surprising Charts and Numbers = Decrease?

I would have expected more of a flat line with no decreases in cost per claim.  Let us look at the  NCCI study summary info:

  • From 2012 to 2021, the average drug-paid cost per claim decreased by about 2.6% per year.
  • The annual reduction in drug payment per claim varied across four regions, ranging from 2.0% in the Southeastern region to 3.9% in the Western region.
  • The price of prescription drugs grew at an annual rate of 3.7%, only to be offset by a 6.0% decline in the type and number of prescriptions.
  • Opioid claims1 saw the largest decrease in drug costs, largely due to a reduction in both opioid and non-opioid prescriptions.
  • Countrywide (CW), of claims with at least one prescription, the share of these that also had at least one opioid decreased from 55% in 2012 to 26% in 2021.

My Take On The NCCI Workers Comp Prescription Analytics

Why did the cost per claim occur per state and nationwide?  The study mentions one of them and not the other.

  1. Opioids became a workers comp buzzword.  When a cost becomes a buzzword with a negative connotation, the attention paid to opioids caused a huge spike in reviewing, challenging, and providing alternatives in the claim departments nationwide.
  2. The other one is that (as I saw it in claim reviews), many people were hesitant about seeking medical treatment during the pandemic – understandably so in most cases. Physicians were not going to renew opioid prescriptions without an associated office visit.
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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management 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

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