It’s Time to End Physician Dispensing in Workers’ Comp

There has been an ongoing debate around the merits of physician dispensing in workers’ compensation. Those in favor of allowing this indicate it increases patient compliance with treatment recommendations and is more convenient for the patient. Those opposed point to significantly higher costs with physician-dispensed drugs.

It’s All About Money

Recently, a physician forwarded me a marketing email he received from a company that specializes in helping physicians implement pharmacy dispensing and toxicology screening in their office. Some highlights included:

• “We guarantee the most profitable programs! Make sure your dispensing and toxicology programs are as profitable as possible. If you are not dispensing or tox testing your patients, it is time to start. If you answer ‘No’ or ‘I don’t know’ to any of the following questions, give us a call. We will provide a free consultation and, if we can’t make your program more profitable, we will tell you!
• Are you dispensing the most profitable medications for each clinical indication?
• Are you capturing all possible dispensing and tox testing opportunities?”

What’s missing from this marketing email? There is no mention of increased patient compliance with treatment or patient convenience. The message revolves around increasing profits for the dispensing physician. In other words, it’s all about the money.

There are some great studies from the Workers’ Compensation Research Institute, California Workers’ Compensation Institute, and Accident Fund Holdings that demonstrate that physician dispensing increases the quantity of drugs dispensed, produces longer periods of disability, poor patient outcomes and significantly increases claim costs. However, I have seen nothing credible to support the argument for physician dispensing.

The patient convenience argument is a complete sham. How many pharmacies are within five miles of your home? Nationwide, Walgreens has more than 8,200 drug stores, CVS has more than 7,000. Most major grocery chains have pharmacies, as do most Wal-Mart, Target and Costco stores. If you live in an isolated place that is not surrounded by pharmacies, there are multiple companies that specialize in mailing prescriptions directly to your door.

The Reason Costs Remain High

The issue of physician dispensing illustrates the reason workers’ compensation medical costs are significantly higher than the same diagnosis on the group health side. In group health and Medicare, the policy dictates what is covered. Physician dispensed medications are not allowed. It’s that simple.

Unfortunately, under workers’ compensation, it seems that anything not specifically prohibited by the statutes and regulations ends up finding its way into the system. There is a small group of medical providers who look to exploit loopholes in the workers’ comp system for profit. The injured worker is a commodity used for financial gain.

Because the workers’ comp system is susceptible to medical providers with less-honorable intentions, regulators must implement controls to prevent such abuses.

Sometimes controls are complex, such as the evidence-based treatment guidelines adopted in several states. For physician dispensing, the solution is simple. Just say no. There is overwhelming evidence to support that physician dispensing increases costs, lengthens disability, and produces poor outcomes for injured workers. It’s time to end physician dispensing in workers’ compensation.