So far, 2021 has differed from previous years in many respects, but one thing has held true – drug prices went up. In late December and early January, drug manufacturers increased the price of more than 700 drugs. On average, prices rose by 4.5%. Both of these numbers are consistent with price increases over the past few years.
Some Increases May Impact MSAs
Many of the increases impact drugs that do not play a significant role in worker’s compensation, such as drugs that treat autoimmune diseases and various types of cancer. However, a small subset of these price increases may impact your worker’s compensation Medicare Set-Asides (MSAs). Nucynta for example, a brand name opioid, which is used to treat moderate to severe pain on a short-term basis, saw an increase of nearly 10% for all immediate release and extended release formulations. Bupropion, a generic drug used for the treatment of depression, saw an increase of 13% for both the 75mg and 100mg tablets. Prices also rose for Ambien CR, Arthrotec, Celebrex, Cymbalta, gabapentin, Lexapro, Lidoderm patch, Lyrica, OxyContin, Skelaxin, and Voltaren gel. Perhaps the most concerning increase occurred with tizanidine 4mg tablets, with prices soaring by over 1,500%. What’s the real life MSA impact of a change like this? For a claimant who takes 4mg of tizanidine three times daily, the increase translates into an additional cost of $1,479.60 per year. This equates to an increased allocation of $29,592.00 over a 20-year life expectancy.
Future Price Increases Expected
This phenomenon of ever escalating drug prices certainly isn’t new, and unfortunately we haven’t seen the last of it. Additional price increases are expected in April, July, and October of this year. As always, we’ll continue to monitor these costs and update our readers accordingly.
The constant challenge of controlling drug costs makes selecting the right MSA vendor critical. At MEDVAL, we are uniquely positioned to conduct drug utilization assessments and recommend changes that could result in an average estimated savings of up to 40% depending on the medication class. Contact us today for a drug utilization assessment, or submit an online referral.