Free Choice Pharmacy Debate A Smoke Screen

Does it matter whether injured workers have a choice as to where they get their prescriptions filled?

To me the answer to the question depends upon whether any particular choice is tainted by some special interest profiteering at the expense of the system.

In theory, open competition for the business of filling a prescription seems to make sense - after all a competitive marketplace should, according to theory taught me in business school, offer the best prices for the best products and services.

But this is workers' compensation, and workers' compensation is not a competitive marketplace. It is a regulated marketplace, which means that, for the most part, free market concepts are hindered by the mandatory nature of comp.

In other words, because nearly every employer must be subject to workers' compensation, and nearly every employee must submit to workers' compensation, there is no true market competition (except in Texas where work comp is optional). Consequently, any "free choice" in workers' compensation is tempered by the fact that in truth neither the employer nor the employee can go outside the system.

So workers' compensation is really a captive market, and thus requires regulation, because captive markets are very, very easy to manipulate and game.

There is a nascent trend, that started and failed in New York last year, for free choice pharmacy benefits, or right to choose. Proponents tout that the free market competition that would be permitted by "free choice" will control costs and provide better outcomes.

Proponents of pharmacy choice legislation, led by Injured Workers Pharmacy (IWP), a national mail-order pharmacy specializing in prescriptions for injured workers, are pursuing legislation in New Hampshire, Senate Bill 95 by New Hampshire Sen. Sharon Carson, R-Londonderry, that would give injured workers the right to choose where they get their prescription drugs.

This group attempted similar legislation in New York last year but the bill did not get passed.

IWP, which relies on referrals from claimant attorneys as opposed to networks, views the successful passage of pharmacy choice legislation as critical to its business. That makes sense.

The opposition in New York was led by pharmacy benefit management companies, and a right to choose pharmacy bill would certainly impair the PBM business model, so I can understand the opposition too.

The New Hampshire bill would also introduce a fee schedule for pharmacy benefits. Currently, in New Hampshire, fees for pharmaceuticals are based on a usual and customary rate system - and believe it or not that is where some opposition is coming from.

According to the WorkCompCentral story on the topic this morning,  George Roussos, a lobbyist for the New Hampshire Association of Domestic Insurance Cos., who was the only person to speak in opposition to SB 95 at a committee hearing last Thursday, said, "Why is it that these pharmacies need to be protected by having assurances of a certain price which translate to mean a certain profit?"

I think Roussos has it backwards. As we have seen in other states that have already grappled with "usual and customary" pharmaceutical fees, eventually because of the captive market of work comp, prices get out of control. A fee schedule helps control excess profiteering.

The PBMs and insurers who oppose pharmacy choice legislation believe routing a prescription through a network increases patient safety and could potentially alert the pharmacist and payer to harmful medication issues. They argue prescriptions filled outside pharmacy networks and PBMs do not undergo these safeguards.

I think the arguments on both sides are much more basic than patient safety, convenience, protection or pharmaceutical safeguards. 

The real issue is simply special business interests protectionism.

My guess is that one in a hundred injured workers, if even that many, gives a rat's derrière about where their medications come from, how much they cost, etc. 

There is nothing about the patient's interests that is driving this argument. Anyone proffering that argument is engaging in a diversionary tactic, also known in more common parlance as a "smoke screen."

The first thing that needs to be acknowledged in the debate is that such proposed legislation is all about money - who gets what, when and how.

If the parties can come to terms with that basic fact then perhaps some reasonable compromise can be achieved. Otherwise, leave the injured worker out of the debate because it has nothing to do with their best interests.

Bad Faith, Cost Shifting, Reform - Dissatisfaction or Lack of Relevancy?

Is it more than coincidence that yet another state's appellate court has rejected a worker's civil complaint for bad faith and fraud on the grounds that workers' compensation is the exclusive remedy?

Or that a study finds that an alarming amount of occupational injuries are not handled through workers' compensation?

Or that a really big state once again makes radical changes to its work comp system?

This year high courts in Texas and New Jersey both ruled that injured workers have no common law right to sue an insurance carrier for harm allegedly caused by its administration of a claim. Those cases were Texas Mutual Insurance Co. v. Ruttiger, handed down in June, and Stancil v. Ace USA, handed down in August.

A Connecticut case this week reinforced the concept in Desmond v. Yale-New Haven Hospital Inc. et al., No. AC 33072.

Desmond slipped and fell while working for the Yale-New Haven Hospital in December 2004. After her fall, she said her doctors diagnosed her with bilateral, acute post-traumatic carpal tunnel injuries that would render her permanently unable to use her hands if she did not receive medical treatment.

Her employer accepted her claim for workers' compensation benefits, but in May 2010, Desmond filed a 10-count complaint against the hospital accusing it of having made various filings with the state workers' compensation commission in a bad faith and fraudulent attempt to delay treatment, which resulted in a worsening of her condition.

The case was dismissed at the trial level.

Desmond appealed using a novel state specific argument which the appellate court decided did not apply.

That attempts are still being made to skirt the exclusive remedy of workers' compensation after so much case law does not make a trend.

But the creativity of claimants and their lawyers (Desmond was represented in the case by her attorney-husband) in trying to get around workers' compensation control might be reflective of something more disturbing - cost shifting.

There have been several studies and reports over the past few years indicating that less and less occupational injuries or illnesses are actually be paid for by workers' compensation systems.

Now the New Hampshire Department of Health and Human Services says that only about half of all occupational injuries end up going through the workers' compensation system.

In the Department's telephone survey of 6,892 adults in New Hampshire, 3,735 respondents reported working at some time during the previous 12 months, 4.9% and said they had been injured at work seriously enough to receive medical advice or treatment.

Of that total, 54% said all or part of their treatment was paid for through the workers' compensation system. About 25% reported their care was paid for by private or government insurance and another 21% said they paid for medical care through some other means.

"While respondents employed for wages are likely to be covered by the New Hampshire workers’ compensation system, our study estimated that only about half of those employed for wages and injured seriously enough to require medical treatment had some or all of their medical treatment paid for by workers’ compensation," the study concluded. "This represents a substantial financial burden falling on private and public insurers, as well as on individual families paying for costs out of pocket."

And as we are well aware, California's massive "reform" just 8 years after an earlier massive "reform" is certainly evidence of much gone awry.

I've opined before about whether or not workers' compensation in its present form is relevant to today's economy and society. Attempts to get around work comp exclusivity in the face of long standing legal precedence, studies indicating failure of workers' compensation to do its job, massive re-writing of laws; all should make us pause to wonder why - why is there such dissatisfaction with workers' compensation?

The reasons are probably as numerous as the way folks get injured on the job.

Market Basket Fine Shows Enforcement is the Only Relevant Safety Motivator

Right on the heels of my post on Monday about a study from the Rand Corporation concluding that safety plans are benign relative to improving safety, but that enforcement was the prime motivator, comes a story this morning about a significant safety enforcement action.

The U.S. Labor Department has asked the Occupational Safety and Health Review Commission to compel Tewksbury, Mass.-based DeMoulas Super Markets, owner of 60 Market Basket stores in Massachusetts and New Hampshire, to correct safety problems and pay fines of $589,200.

In 2006, after being cited by the Occupational Safety and Health Administration (OSHA), DeMoulas agreed to complete job-hazard analyses in all of its stores but failed to do so.

The Labor Department's complaint alleges that employees at the stores were exposed – or were likely to be exposed – to hazards from unguarded, open-sided work and storage areas, including storage lofts, produce coolers and freezers.

Also alleged in the complaint is that the supermarket chain failed to protect workers in the produce, deli and bakery departments from laceration hazards from knives and other cutting instruments by not conducting an analysis of job hazards.

An employee was seriously injured in April 2011 when he fell 11 feet onto a concrete floor from an inadequately guarded storage mezzanine, and an employee at a Billerica, Mass., store was seriously injured under similar conditions in 2007 according to OSHA.

Between 2008 and 2011, employees at stores in Rindge and Concord, N.H., sustained at least 40 hand lacerations.

OSHA said the DeMoulas complaint is only the second such action taken by the Labor Department, which filed a complaint against the U.S. Postal Service in July 2010, seeking the correction of electrical safety violations at 350 post offices throughout the nation.

DeMoulas is contesting the FINES according to the OSHA press release, which is silent about any action DeMoulas is taking relative to correct the safety problems.

The point is that the super market chain/employer did not take seriously the agreement to complete job-hazard analyses.

It took enforcement action to get this employer to view workers safety in a serious manner. 

That's a sad statement as to this employer's commitment to doing business in the United States in a legal, ethical and morally conscionable way, and testament to the fact that labor enforcement departments on both the federal and state level need adequate funding in order to protect the working population of this nation.workers compensation, work comp, injured worker 

NH Case Illustrates Legal Fiction in Causation

In his book, Stabbed In the Back: Confronting Back Pain in an Overtreated Society, Nortin Hadler MD argues that much of what we consider an "injury" in our health care and workers' compensation systems are not really injuries.

Dr. Hadler's book specifically addresses regional back pain as a condition that has gone from a normal experience of the human body, the product of general aging for the most part, to an "injury" providing substance to a grand medical sub-industry attempting to treat something with very limited success, if any at all, from a statistical and scientific standpoint.

What Dr. Hadler bemoans is how the laws and legal systems in the United States turn what otherwise would not be medically an injury into a condition that not only increases medical costs but disability. The import of Dr. Hadler's work is that society has essentially created injuries where none exist.

Much of what Dr. Hadler writes about is the product of the law, whether statutorily expressed or interpreted through cases - the point is that we legally recognize an injury (or the inverse, DON'T recognize an injury) other than the fact that the law says so with no underlying medical basis.

Essentially, Dr. Hadler points to confusion on causation. There is medical causation, and then there is legal causation.

A condition may have a basis in medical science, but not be recognized for legal purposes, which is generally tied to some system of indemnity and/or reimbursement for expense.

A New Hampshire case that was reported this morning in WorkCompCentral News is a perfect example of why physicians have a difficult time understanding how the law impacts what is, or isn't an injury.

The Supreme Court of New Hampshire decided that the Legislature intended to exclude a former business owner's depression from the list of compensable injuries, in the case of In Re Appeal of Letellier.

In the months before the business closed, Letellier saw a nurse at Concord Psychiatric Associates because of stress. He was diagnosed with major depression and hypertension, and filed a workers' compensation claim with Chartis Insurance for mental stress and severe depression.

The state's Compensation Appeals Board (CAB) awarded Letellier reimbursement for medical bills and expenses, but did not award indemnity benefits. Both parties appealed, with Letellier arguing for indemnity benefits and Chartis contending that the injury was not compensable at all.

The state Supreme Court noted that while major depression arising from work-related stress can be compensable, state law specifically exempts mental injuries caused by "any disciplinary action, work evaluation, job transfer, layoff, demotion, termination, or any similar action, taken in good faith by an employer." In other words, the statutory language bars compensation for mental injuries caused by good faith personnel actions.

"Like the listed exclusions, the possibility of a business failure is a normal condition of employment," the court wrote. "It, too, is often precipitated by poor company performance or general economic conditions. A business failure is indistinguishable from the specifically enumerated exclusions. Viewing the plain meaning of the phrase 'any similar action' in light of this fact compels us to conclude that the phrase encompasses a business failure."

To add to a physician's confusion over causation, even the law can't agree sometimes! In this New Hampshire case, two of the five justices on the court's panel dissented.

Chief Justice Linda Stewart Dalianis wrote that the statute only excludes "mental injuries that result from a good faith personnel action." She explained that even if the Legislature did not intend to allow claims such as Letellier's, the statute's actual language appears to render his claim compensable.

"Moreover, I believe that because of our obligation to construe the Workers' Compensation Law liberally to give the broadest reasonable effect to its remedial purpose, we must interpret the statutory exclusion at issue narrowly," Dalianis wrote. "Thus, I would hold that the claimant's cumulative occupational stress and resulting depression, caused by the failure of his business, do not fall within the statutory exclusion from the definition of 'injury.'"

When I lecture to physicians, I tell them that many things which they see medically as measurable science is described legally in fictional terms. I think this case illustrates that point.workers compensation, work comp, injured worker