More than a year later, it is clear that the primary effect of the COVID-19 pandemic on the workers’ compensation industry in 2020 was an overall reduction in new claims. According to the research by the California Workers’ Compensation Institute, it is estimated that new claim decisions fell by 19.3% in the first half of 2020. Yet even as we move forward and see indicators of renewed economic activity and people returning to work, it’s still essential to continue reviewing data and identifying key trends. This is especially true in workers’ compensation pharmacy, where pre-existing issues such as long-term claim costs and behavioral care will continue to be concerns as the economy restarts.
Workers’ Compensation pharmacy benefit managers (PBMs) had their work cut out for them as they analyzed the 2020 data tdro identify the major factors affecting injured workers and payers alike. Clinical experts had to understand how the pandemic and larger economic drivers may have impacted, or distorted, the data to develop a clear picture of the current state of workers’ comp pharmaceuticals.
“When we started to look at the past year, we knew the drop-off in new claims was going to affect the numbers,” explained Phil Walls, Chief Clinical Officer for workers’ compensation PBM myMatrixx. “We’ve known for a long time that newer claims are associated with lower drug utilization and expense, so when new claims began to decline after COVID, those were the first areas we examined.”
The COVID-19 Distortion Effect — A Decrease in New Claims Raised Average Utilization Rates
While preparing their 2020 Drug Trend Report, Walls and the myMatrixx clinical team worked closely with parent company Express Scripts, now a part of Evernorth. “Although there were many challenges to adapt to over the last year, myMatrixx was able to continue driving down drug spending and utilization in the workers’ comp sector,” said Rochelle Henderson, Vice President of Clinical Research for Evernorth. She continued, “In fact, with a focus on pharmacovigilance and data analysis, myMatrixx achieved a 2.6% reduction in cost per days’ supply for 2020.”
However, both organizations were committed to understanding the full impact the pandemic had on these statistics. For years, a cornerstone of the myMatrixx strategy has been looking closely at older claims for more effective management. Previous editions of their annual report have highlighted the “age-of-claim effect,” which shows drug costs and utilization rates tend to go up the longer a workers’ comp injury case stays open.
So, what does this have to do with the COVID-19 pandemic? As Walls explained, “When we looked at the 2020 data, we saw what appeared to be an increase in utilization and spend at the per-patient level. Soon, we put it together that with the decrease in new claims due to COVID, we were also removing the lowest utilizers.”
Henderson elaborated further, “The removal of newer claims from the drug data essentially skewed the averages, showing an increase for myMatrixx of 12.2% in average Rx utilization per injured worker.” She continued, “The myMatrixx and Evernorth clinical teams labeled this the ‘COVID distortion effect,’ and we believe it will continue to be an important benchmark as we measure the long-term effect of the pandemic on claims data.”
Added Walls “By identifying this effect, we’ve shown that there has been no major change in utilization behavior at the injured patient level. Now that we are confident in the cause of these numbers, myMatrixx can continue to carefully manage patient safety and control costs for clients, especially in these older claims.”
How the Quarantine, and the Experience of Injured Workers, Demonstrated the Need for Behavioral Care
Almost as soon as people started receiving orders to stay at home after the declaration of the pandemic last March, there was a recognition of the potential effects of increased isolation and uncertainty on mental health. “Last April, Express Scripts released ‘America’s State of Mind Report,’ which found increases in prescriptions for antidepressants, anti-anxiety medication and other psychotropic drugs during the early stages of the pandemic,” said Henderson. “This underscored the important role that behavioral health care would need to play in these completely new circumstances we found ourselves in.”
While that report was focused on the general population and group health, Walls and the myMatrixx team saw an intriguing parallel when they examined it from the perspective of workers’ compensation. “I was struck by how much the experience of people during quarantine resembled what happens to a worker who gets seriously injured at work,” said Walls. “Injured workers basically go through their own quarantine, and their mental health suffers accordingly due to anxiety about the future, lack of productive activity and a host of other concerns,” he explained.
“The takeaway here is that workers’ comp pharmacy, which has traditionally stayed away from treating behavioral health, can no longer afford to take this position,” Walls continued. “There is growing evidence that mental health problems can increase the length of claims, and likewise, injured workers with long-term claims due to chronic pain tend to develop mental health problems.” Walls explained that through careful management, myMatrixx has been successful in keeping down cost per days’ supply down across all categories of psychotropic drugs. “This was even the case as utilization has increased over the past year, according to our 2020 Drug Trend Report,” he said.
Henderson also stresses the need for a comprehensive approach to behavioral health beyond medication alone. “For many patients, psychotropic drugs, including antidepressants, anti-anxiety drugs and sleep-aids, are only part of the treatment picture and may only need to be a short-term solution,” she said.
Walls agreed and elaborated, “On the workers’ comp side, many of our clients have found success implementing effective solutions, including cognitive behavioral therapy, with an enhanced focus on reentering society and returning to work.”
In a Turbulent Time, Successful Claims Management Requires Clinical Expertise and Careful Analysis
No one could have predicted last year’s pandemic and all the ways it would affect society, right down to the workers’ compensation industry. However, that makes it all the more important to carefully examine these events when they do occur. As Walls put it, “For any facet of claims management, including retail drug utilization and spending, there is no substitute for access to clinical expertise. Our entire team, including our partners at Evernorth, are committed to analyzing the increasingly complex world of pharmaceutical data, and turning it into actionable information for claims professionals and anyone in the industry.”
If you’re interested in learning more about these and other major drivers in the industry, myMatrixx invites you to explore their 2020 Drug Trend Report.