Formulary Implementations and Initial Impacts on Workers Compensation

Flipping the Script: How Closed Formularies Can Impact WC Drug Experiences

When it comes to the makeup of a workers compensation claim, the mix of expenditures is ever-changing. Beyond the initial medical treatment and facility costs when a worker becomes injured on the job, prescription drug payments comprise a substantial portion of medical-related expenses.

As states grapple with high prescription drug costs and an ongoing opioid crisis, regulation of prescription drug prices and utilization has become a focus of legislative activity in workers compensation.

In this paper, NCCI researchers take a deeper look at critical factors that are influencing pharmacy experience in workers compensation, including:

  • The initial impact of the Official Disability Guidelines Workers’ Compensation Drug Formulary (the ODG Formulary) on pharmacy costs
  • Utilization rates of drugs (N-drugs) that require prior authorization by the employer or workers compensation insurer, and those that do not (Y-drugs)
  • A review of two states, Arizona and Tennessee, which both recently adopted the ODG Formulary, to analyze cost and utilization trends
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Find the full report, and all of NCCI’s expert research, on the INSIGHTS section of ncci.com.

​This article is provided solely as a reference tool to be used for informational purposes only. The information in this article shall not be construed or interpreted as providing legal or any other advice. Use of this article for any purpose other than as set forth herein is strictly prohibited.
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