COVID-19 has completely overshadowed certain health issues. The opioid epidemic has taken a back seat to the current pandemic. In 2019, 1.6 million Americans had an opioid use disorder and 10.1 million people misused prescription opioids. HHS citing the 2019 National Survey on Drug Use and Health, 2020. While the COVID-19 pandemic persists, data suggests that “[t]he nation’s COVID pandemic made the nation’s drug overdose epidemic worse.” See American Medical Association Issue Brief.
In the realm of bodily injury insurance claims, “[i]n 2020, 34% of all workers’ compensation claims with prescriptions had at least one prescription for opioids based on data from 40 states.” CDC citing December 2020 NCCI Research Brief. In a recent report issued by Mitchell, which examined trends in 2020, it cautioned the workers’ compensation and auto claims industries that “two major issues have signaled that the opioid crisis is far from over, despite the progress made.” See Mitchell's 2020 in Hindsight: Clinical Trends and Predictions. First, the report states that an increase in synthetic opioids, like fentanyl, are leading to an escalation in overdose fatalities. Second, as the AMA report cited above also indicates, the COVID-19 pandemic has contributed to an increase in drug abuse. The Mitchell report noted that not all overdoses are directly connected to opioids a claimant may be prescribed during the course of treatment in a claim.
Notwithstanding negative impacts the COVID-19 pandemic has had in relation to the opioid crisis, the Centers for Disease Control & Prevention (CDC) indicates that “[t]he average amount of opioids prescribed per workers’ compensation claim has been reduced in most states, although this does vary by state.” CDC citing WCRI’s Interstate Variations in Dispensing of Opioids, 5th Edition.
In the realm of Medicare Secondary Payer (MSP) – specifically – Workers’ Compensation Medicare Set Asides (WCMSAs), there has been a concern vis-à-vis the opioid epidemic as the Centers for Medicare & Medicaid Services (CMS) mandates a methodology for allocating a WCMSA which requires “prescription medications for… the expected duration of the claimant’s life.” See WCMSA Reference Guide, v3.3, Sec. 9.4.1. CMS does have provisions allowing for weaning/tapering, if there is medical evidence supporting this, however, “[u]sually, the latest weaned dosage is extrapolated for the life expectancy.” WCMSA Reference Guide, v3.3, Sec. 188.8.131.52.
There has been industry advocacy undertaken to persuade the CMS to reconsider alternative allocation methodologies as it relates to opioids. In 2018, in a letter to Congress, MSPN indicates that it, “…estimates that 70 percent of all CMS-approved MSAs that include prescription medication have life-long allocations for opioids. For the past five years, the organization has tried to persuade CMS to apply evidence-based medical guidelines to its MSA allocation policy…” See April 18, 2018 MSPN Press Release.
In 2019, CMS addressed a solution to the opioid issue in MSAs by advocating for professional administration and requiring additional measures be taken by professional administrators. On October 30, 2019, CMS issued in version 3.0 of its WCMSA Reference Guide, the following: “CMS highly recommends professional administration where a claimant is taking controlled substances that CMS determines are ‘frequently abused drugs’ according to CMS’ Part D Drug Utilization Review (DUR) policy. See Sec. 17.1. Specifically, CMS has identified opioids and benzodiazepines as frequently abused drugs. Moreover, the Reference Guide indicates that, “CMS expects that WCMSA funds be competently administered in accordance with all Medicare coverage guidelines, including but not limited to CMS’ Part D Drug Utilization Review (DUR) policy. All professional administration programs should institute Drug Management Programs (DMPs) for claimants at risk for abuse or misuse of “frequently abused drugs.” See Sec. 17.3.
The fact that CMS highly recommends professional administration in instances of frequently abused drugs reflects recognition that steps must be taken post-settlement to protect claimants. These guidelines also highlight the health and safety risks posed when an individual decides to self-administer their MSA. Given the propensity for misuse and abuse of opioids with the possibility of a cash-payer with unfettered access to MSA funds, there is potential risk for parties settling a claim involving an MSA with frequently abused drugs and self-administration. Professional administration adds a layer of Part D guidelines to ensure the proper notification and alerts issue in the event of potential risks. Professional administration provides assurance and exposure mitigation to the employer/carrier as well as the defense and claimant’s attorney that there are procedures in place to prevent misuse and abuse of frequently abused drugs.
A self-administration situation involving frequently abused drugs is ripe for a bad situation. Parties to these settlements should take heed to CMS’s guidance and advocate to have the MSA professionally administered to maximize the safety for the injured individual and set them up for post-settlement success in their course of continued treatment.
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