Work Comp Drug Costs in Louisiana 75% Higher Than Study Median

April 23, 2010

The cost per claim of prescription drugs used to treat injured workers in Louisiana was significantly higher than in most study states, according to a new report by the.

A 16-state study by the Cambridge, MA-based Workers Compensation Research Institute (WCRI) found that the average payment per claim for prescription drugs in the Louisiana workers’ compensation system was $721 — 75 percent higher than the median of the study states.

The main reasons for the higher prescription costs in Louisiana include higher utilization of prescription drugs, higher prices paid to pharmacies, more frequent prescriptions of brand name drugs, and higher prices paid to physicians who dispensed medications directly to their patients.

The WCRI study, Prescription Benchmarks for Louisiana, found that the average number of pills per claim in Louisiana was 61 percent higher than the 16-state median, and the average number of prescriptions per claim was 55 percent higher than that in the median state.

In particular, the study reported that Louisiana doctors wrote prescriptions for certain prescription drugs more often than doctors in other states. The percentage of claims with sleep inducing, antidepressant, and anti-anxiety medications was 10 percentage points higher than the 16-state median.

The average prices paid to pharmacies for common drugs were higher than the median study state due, in part, to the state’s high pharmacy fee schedule. For example, the price paid for the painkiller Vicodin, which was received by 68 percent of Louisiana injured workers, was 27 percent higher in Louisiana than the median of the 16 states.

Louisiana physicians wrote prescriptions for brand names more often, the study reported. Twenty-one percent of all prescriptions were those for brand names when generic equivalents or alternatives were available, compared to 15 percent in the median state.

The study also found that Louisiana physicians who dispensed prescription drugs at their offices were often paid higher than what pharmacies received for the same prescription.

The WCRI study is the first in an annual series that benchmarks the cost, price and utilization of pharmaceuticals in workers’ compensation.

The Workers Compensation Research Institute.

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