Florida Employers: Fight Back on Repackaged Drugs

                               Now that AHCS has won the day in Florida, it's time for the state's employers to fight fire with fire. Clearly, the proposed amendments to SB 668 (offering rebates and rate roll backs) were not at all a genuine attempt at political compromise, but rather an intentional obfuscation of the process intended to stall the bill in committee. Bad outcome, but solid strategy. So what to do?

First, leverage utilization review to ensure the drugs being dispensed are, in fact, medically necessary. If not, stop paying. If they are, explore following the lead of the Miami-Dade School System (and a few other fed up employers) that may have figured out another potential solution.

According to a workcompcentral article from February 24, "Florida Statute 440.13 (12) establishes the current fee cap, but allows carriers to contract for a lower amount. The statute also allows carriers to pay contract amounts even if a provider is not a party to a contract... In October 2010, after Crist vetoed the first repackaging price cap, Miami-Dade Public Schools cited that section of the workers' compensation law and refused to pay repackaged drug prices for its 48,000 workers."

Here's how this works: An injured worker gets hurt and sees a doctor. The doctor prescribes and dispenses a drug, then makes up an NDC code, marks it up 300%, and bills the insurer. However, if a retail pharmacy, under contract with the insurer, is reasonably accessible for the injured worker, the insurer can re-price the drug to the contracted rate. I've talked to the Florida DWC about the definition of "reasonably accessible" - candidly, they're not really sure what would hold up in court.

This strategy is not without risk, but it might be worth a try for an employer tired of paying way too much and willing to put some legal dollars behind what is sure to be a well-financed fight with the likes of AHCS.

Michael