Pain management represents a significant portion of workers compensation medical costs, totaling 30% in Service Year (SY) 2023.
In this brief, we examine pain management costs across states because, as we often say, every state has its own story. We also examine what, if anything, has replaced the use of opioids in addressing pain and the related costs for the industry. Finally, we explore four types of regulatory measures, illustrating how policies can play a meaningful role in managing future topical costs.
KEY FINDINGS
- Even after controlling for a mix in diagnoses, pain management costs vary significantly by state.
- The costs of treating pain through physical medicine and major surgery have increased across almost all states. This increase, however, has been partially mitigated by a sharp decline in drug costs, primarily driven by a reduction in opioid usage.
- Pain management (PnM) paid per claim increased on average by 1% per year, with the largest increase at 5.3% in Louisiana and the largest decrease at 3.0% in Alaska.
When breaking down the total PnM paid amounts into medical service categories in Figure 3, the largest medical service categories for total PnM paid amounts are major surgery (34% of total PnM costs), drugs (14%), and physical medicine (14%).
The information in Figure 4 is the same as above, this time displayed as differences from the median across the study-states.
MORE KEY FINDINGS
- The decline in opioid costs is being offset by an increase in the use of topical creams and gels. The degree of changes in drug costs is a key driver of state differences.
- States with strict physician dispensing limits are among the states with the lowest topical medication costs.
- Opioids and topicals, on average, make up 40% of drug costs per PnM claim for all study-states combined. This means that due to the higher price of topicals, even small upticks in utilization can result in significant increases in costs.
- Over 50% of topical payments on average are physician-dispensed, compared to 17% for all other pain management drugs.
To explore the full findings and data analysis, read the
complete report.
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