COMMONWEALTH OF PENNSYLVANIA HOUSE OF REPRESENTATIVES
LABOR AND INDUSTRY COMMITTEE PUBLIC HEARING
STATE CAPITOL HARRISBURG, PA
IRVIS OFFICE BUILDING ROOM G-50
WEDNESDAY, FEBRUARY 15, 2017 10:30 A.M.
PRESENTATION ON HB 18 (MACKENZIE) DRUG FORMULARY TO PREVENT OPIOID ABUSE IN WORKERS' COMPENSATION
BEFORE: HONORABLE ROB W. KAUFFMAN, MAJORITY CHAIRMAN HONORABLE STEPHEN BLOOM HONORABLE SHERYL M. DELOZIER HONORABLE CRIS DUSH HONORABLE FRED KELLER HONORABLE RYAN E. MACKENZIE HONORABLE DAVID M. MALONEY, SR. HONORABLE JACK RADER, JR. HONORABLE JESSE TOPPER HONORABLE JOHN T. GALLOWAY, DEMOCRATIC CHAIRMAN HONORABLE MORGAN CEPHAS HONORABLE MARIA P. DONATUCCI HONORABLE LEANNE KRUEGER-BRANEKY HONORABLE DANIEL T. McNEILL HONORABLE BRANDON P. NEUMAN HONORABLE PAM SNYDER
Pennsylvania House of Representatives Commonwealth of Pennsylvania 2
COMMITTEE STAFF PRESENT: JOHN SCARPATO MAJORITY EXECUTIVE DIRECTOR GLENDON KING MAJORITY RESEARCH ANALYST ELANA MAYNARD MAJORITY LEGISLATIVE ADMINISTRATIVE ASSISTANT II
VICKI DiLEO DEMOCRATIC EXECUTIVE DIRECTOR HALEY SALERA DEMOCRATIC RESEARCH ANALYST 3
I N D E X
TESTIFIERS
* * *
NAME PAGE
JOHN SCARPATO EXECUTIVE DIRECTOR, HOUSE LABOR AND INDUSTRY COMMITTEE...... 5
SAMUEL R. MARSHALL PRESIDENT/CEO, INSURANCE FEDERATION OF PENNSYLVANIA...... 8
JEFFREY JACOBS, MD FELLOW, AMERICAN COLLEGE OF OCCUPATIONAL AND ENVIRONMENTAL MEDICINE...... 12
MICHAEL VOVAKES DEPUTY SECRETARY FOR COMPENSATION AND INSURANCE, PA DEPARTMENT OF LABOR AND INDUSTRY..... 15
JOSEPH C. HUTTEMANN, ESQ. PARTNER, MARTIN LAW; EASTERN DISTRICT CHAIR OF THE WORKERS' COMPENSATION SECTION, PA ASSOCIATION FOR JUSTICE... 36
AARON TURNER-PHIFER DIRECTOR OF GOVERNMENT RELATIONS, URAC...... 49
CARLOS LUNA DIRECTOR OF GOVERNMENT AFFAIRS, MD GUIDELINES, REED GROUP, LTD...... 53
KENNETH EICHLER VICE PRESIDENT, ODG/WORK LOSS DATA INSTITUTE...... 58
SUBMITTED WRITTEN TESTIMONY
* * *
(See submitted written testimony and handouts online.) 4
1 P R O C E E D I N G S
2 * * *
3 MAJORITY CHAIRMAN KAUFFMAN: Good morning.
4 It is 10:30, and I like to be on time, so we
5 are going to start this meeting and call this meeting to
6 order.
7 And if you'll indulge me, I would like if we
8 would begin to rise and give the Pledge to the flag.
9
10 (The Pledge of Allegiance was recited.)
11
12 MAJORITY CHAIRMAN KAUFFMAN: All right.
13 I would like to welcome everyone this morning to
14 this meeting of the House Labor and Industry Committee.
15 Just as a reminder to all in the room, this
16 meeting is being recorded, and I would appreciate if the
17 Members -- and this is a reminder to myself as well -
18 would silence their cell phones and electronic devices to
19 eliminate as many interruptions as possible.
20 And to start out, I'm going to ask the secretary
21 if she'll please call the roll.
22
23 (Roll call was taken.)
24
25 MAJORITY CHAIRMAN KAUFFMAN: Thank you very much. 5
1 Today we will be discussing Representative
2 Mackenzie's legislation, House Bill 18. This would require
3 a drug formulary for workers' compensation.
4 We have a number of witnesses here today to
5 discuss the legislation. And the Committee has received
6 some written testimony, and those who have submitted
7 written testimony in lieu of being here today are the
8 PA Chiropractors' Association, the PA Orthopaedic Society,
9 Optum Workers' Compensation Pharmacy Benefit Manager, and
10 the Pennsylvania Chamber of Business and Industry.
11 I appreciate you all being here today. I do like
12 to keep things moving. We have given all of those who will
13 be testifying some guidelines, and I will attempt to move
14 you along if you are not meeting those guidelines, because
15 we have another hearing this afternoon.
16 So as we move forward, I'm going to recognize my
17 Executive Director, John Scarpato, of the Committee to
18 provide a brief synopsis of the bill. And then at some
19 point during this -- the prime sponsor is not here
20 currently, but he is en route and has just been held up a
21 bit. So I'm going to open that up for John to give a
22 synopsis.
23 EXECUTIVE DIRECTOR SCARPATO: House Bill 18 is
24 Representative Mackenzie's bill. The bill will require
25 the Department of Labor and Industry to adopt a nationally 6
1 recognized, evidence-based prescription drug formulary
2 after taking comments from the public.
3 The current formulary would be available on the
4 Department's website for reference by the medical community
5 and the general public, and prescription drugs not
6 consistent with or recommended by the formulary would not
7 be considered reasonable and necessary for the purposes of
8 utilization review.
9 The bill also provides that the Department will
10 approve only those utilization review organizations that
11 have obtained certification as a utilization review entity
12 from the Department of Health under the Insurance Company
13 Law.
14 The bill also requires that the peer review
15 process and peer review organizations will comply with the
16 requirements for utilization review under the law.
17 MAJORITY CHAIRMAN KAUFFMAN: Thank you, John.
18 And I noticed that Representative Donatucci has
19 entered the room and joined the Committee.
20 Now I would like to ask our first panel to come
21 forward. Joining us now we have Michael Vovakes,
22 Deputy Secretary for Compensation and Insurance at the
23 Department of Labor and Industry here in Pennsylvania;
24 Dr. Jeffrey Jacobs, a Fellow with the American College of
25 Occupational and Environmental Medicine; and Sam Marshall, 7
1 who we all know is President of the Pennsylvania Insurance
2 Federation.
3 As we begin this morning, I would ask all of
4 our witnesses to please summarize their testimony in about
5 5-minute statements. Again, I have noted we have a limited
6 time today, and we want to make sure we get to everyone on
7 the agenda.
8 Glendon, who is on our staff here, he will signal
9 you when you have reached approximately 30 seconds
10 remaining in your remarks to attempt to keep everyone on
11 schedule. I'm not trying to be the principal in the room;
12 I'm just trying to make sure we keep on task here.
13 So you can -- if Glendon is waving a "30" at you,
14 you'll get the picture, I think, pretty quickly.
15 And any questions from the panel as we start
16 out?
17 And I note that Representative Dush has entered
18 the room, as well as Representative Delozier.
19 And we are going to get through as many questions
20 as possible with each panel. I'm going to keep on our
21 timeline. And if at some point we don't get to all
22 questions, we will be taking questions in written form and
23 referring them to whoever they are directed to. We don't
24 want there to be unanswered questions left, but we do want
25 to keep on a timeframe here. 8
1 So it's time to move on, and thank you to all of
2 the panelists who have joined us today. We look forward to
3 working with you. And I'm going to start -- actually, I'll
4 start with Sam this morning.
5 MR. MARSHALL: Okay. Thank you.
6 Sam Marshall with the Insurance Federation.
7 You have our testimony. I'll be brief.
8 The opioid problem needs no introduction, you
9 know, either in Pennsylvania or nationally. What is
10 encouraging is that this Committee recognizes that in
11 Pennsylvania, we face a unique workers' compensation aspect
12 in the opioid problem.
13 I have attached to my testimony pages from the
14 Workers Comp Research Institute study from last July,
15 July of 2016, and we provided the Committee with full
16 studies. And what they show is that, first of all, opioid
17 prescriptions are higher in workers' comp than they are
18 generally, and, you know, health insurance generally,
19 That's almost to be expected. That's the nature of those
20 inj uries.
21 But in Pennsylvania, Pennsylvania is the outlier
22 of the outliers, and in Pennsylvania, the prescriptions of
23 opioid in workers' comp are significantly higher than most
24 other States. I think New York and Louisiana are also up
25 there. They have enacted reforms to try to address it, and 9
1 reforms actually similar to this.
2 So what you have is a problem where workers' comp
3 is unique on the opioid, and generally, Pennsylvania is an
4 outlier of the outlier. The question is, what do you do to
5 solve it?
6 Representative Mackenzie's bill, House Bill 18,
7 the topic for today, we believe does that, and it does it
8 in a very fair way. It says, here, let's have nationally
9 recognized, evidence-based guidelines to, you know, guide
10 the provider community and to guide people who are
11 reviewing the provider community in, you know, their drug
12 formularies.
13 Then, you know, the second thing it does is that
14 it says, let's make sure that those who perform that
15 review, and in workers' comp it's a separate system. It's
16 done by utilization review organizations that are approved
17 by the Bureau and assigned by the Bureau. So it's not
18 insurance companies picking their own favored UROs. It's
19 all done through an administrative process. What the bill
20 says is, let's make sure that those are the gold standard,
21 and that means that they' re URAC certified, the Utilization
22 Review Accrediting Commission. You'll hear from them later
23 on today.
24 So what that does is it addresses the two
25 weaknesses you have in the workers' comp system that lead 10
1 right now to excessive opioid prescriptions. It
2 establishes a meaningful drug formulary, and it establishes
3 high-quality utilization review organizations.
4 One of the things we get asked about is, well,
5 you know, is this going to mean better treatment for
6 injured workers or worse treatment, particularly when
7 compared with their regular health insurance counterparts?
8 You know, how does the health system generally deal with
9 it? The answer to that is that it will bring the treatment
10 to injured workers up to the level -- where right now,
11 they're not at the level -- that the State requires of
12 health insurance generally.
13 Health insurers all use treatment guidelines.
14 That's how they do it. Health insurers, by law, have to
15 use URAC-certified UROs. The Health Department, if you -
16 I mean, frankly, I represent health insurers as well. If
17 you didn't do it, the Health Department would shut you
18 down, and correctly. I mean, we don't challenge that.
19 I would note, tragically, this isn't a newly
20 identified problem, and it's not a newly identified
21 solution. You know, Representative Mackenzie has spoken
22 about this vigorously and openly for just about a year.
23 And he has had, you know, he's introduced it to this
24 Committee. He has introduced it to the Senate and House,
25 you know, the Democrat and Republican Policy Committees, 11
1 and he has had an open-door policy to welcome all
2 perspectives, you know. So this is a proposal that has had
3 considerable exposure already that has -- you know, it's a
4 problem it has and a solution it has.
5 We support it. You know, we worked with
6 treatment guidelines in other States. We're familiar with
7 URAC-certified UROs here in Pennsylvania as well as in
8 other States. We are confident that it will address that
9 unique opioid workers' compensation connection that
10 requires a specific and unique solution to the workers'
11 comp system.
12 I would close by just saying, this is not a new
13 problem; this is not a new solution. If you disagree with
14 it, fine, but I would ask, you know, people who will follow
15 and others, if you disagree with it, what do you have to
16 offer?
17 I know it's very easy -- and, you know, sometimes
18 I'm sure people could say, you know what, Sam; you've done
19 that yourself. It's very easy just to castigate somebody
20 else's solution to a problem that we all admit. But I
21 would ask anybody who's going to criticize this as a
22 solution to offer something yourself, to come up with an
23 idea that you have that will address the problem.
24 We think this will. We think it will improve the
25 care given to injured workers. We think it is long 12
1 overdue, and we hope you move forward on it.
2 Thank you.
3 MAJORITY CHAIRMAN KAUFFMAN: Thank you, Sam.
4 And moving on, Dr. Jacobs.
5 DR. JACOBS: Thank you, Principal Kauffman and
6 Vice Principal Galloway.
7 I'm Dr. Jeff Jacobs. I am board certified in
8 occupational medicine. I have been practicing occupational
9 medicine for over 20 years. I am primarily clinical, but I
10 also have had roles in utilization review, and I am a
11 strong proponent, advocate, for evidence-based medical
12 guidelines. That's how I practice.
13 I wanted to just briefly -- if I can do it in
14 5 minutes; we'll see -- give a few takeaway points about my
15 perspective on the opioids in the workers' comp system.
16 Number one, opioids have a role in the treatment
17 of pain, but they're not the first-line medication in most
18 situations, and I base that on three reasons.
19 One, the available studies don't support the
20 belief that opioids are better at pain relief than
21 nonsteroidal anti-inflammatory medications. They also have
22 a higher risk profile. I have in my written testimony more
23 details on that, of the increased overdose rates of
24 admission to hospitals as well as deaths, and so that
25 doesn't really need a whole lot of explanation. 13
1 Prescription opioids are also, in my opinion, a
2 gateway drug to heroin. There are details of that in my
3 testimony.
4 And for me, I think the hardest part is the
5 quality-of-life issues. The adverse effects of opioids
6 include constipation, sexual dysfunction, sedation,
7 insomnia, and depression. And in my role as a utilization
8 review provider, I see so many people taking medications
9 for their medications, and it's sad. It's sad, the poor
10 quality of life that people with chronic pain have.
11 And then finally, there are disability issues,
12 and studies have shown that prescription opioids delay
13 recovery, increase the chance of becoming chronically
14 disabled, and patients who are on opioids are more costly
15 to treat.
16 My second point is, no one ever became a
17 chronic-pain patient without going through an acute and
18 subacute treatment phase first. And I take that as a
19 charge to myself, because I am a primary-care doctor. Even
20 though I specialize in occupational medicine, I'm the one
21 who sees patients in the first 90 days in Pennsylvania.
22 That also includes other primary-care providers, surgeons,
23 and emergency room providers.
24 And having practiced here in Pennsylvania, I
25 basically divide the 90-day window into three phases. 14
1 The first phase is conservative management, and
2 that typically doesn't include opioids. If people aren't
3 getting better in 2 to 4 weeks, then I'm going to think,
4 did I make an error in my diagnosis? Do they need some
5 type of specialist referral or imaging? But opioids don't
6 have a place in it.
7 I looked up my record in the PDMP, and I saw that
8 in the last year, I had only prescribed eight prescriptions
9 for opioids. And it's not like I'm seeing different
10 patients than other people; it's just that the majority of
11 people don't need it and don't do as well as people who
12 just take nonsteroidals. So I look at it, why screw it up
13 with an opioid?
14 And I was part of the generation in the nineties
15 that was trained that you do give opioids quite liberally,
16 until I was challenged by a hospital administrator that I
17 was writing too many opioids. And in fact, I actually
18 wasn't. I was about the average; one in five patients get
19 opioids for an acute injury. But I have been able to
20 change my prescribing habits, and I think that's one thing
21 that using evidence-based medicine and having a formulary
22 would do. It sounds somewhat devious that you're forcing
23 change in providers, and I will move on.
24 And just to talk about it: The intent of
25 formularies is to reduce overprescribing, to maximize 15
1 healing and improve return-to-work outcomes, and contain
2 drug costs, and if we want to improve outcomes, we have to
3 change prescriber behavior. I think getting better
4 quicker, having less adverse outcomes with less side
5 effects, less lost work time and better productivity, less
6 costs and improved patient satisfaction, are reasonable
7 goals that I don't know anybody would disagree with.
8 And then finally, I think we should be advocating
9 for non-pharmacologic strategies in the treatment of acute
10 and chronic musculoskeletal pain, and they include physical
11 therapy, cognitive behavioral therapy, and acupuncture.
12 So in summary, the last statement is, all
13 stakeholders have a share of the blame for the opioid
14 epidemic and must be a part of the solution.
15 Thank you.
16 MAJORITY CHAIRMAN KAUFFMAN: Thank you,
17 Dr. Jacobs.
18 I want to note that Representative Cephas,
19 Representative Maloney, Representative Neuman, and the
20 prime sponsor, Representative Mackenzie, have joined the
21 Committee this morning.
22 And we're going to move on to the Secretary for
23 your testimony.
24 DEPUTY SECRETARY VOVAKES: Good morning, Chairman
25 Kauffman, Chairman Galloway, Committee, Committee staff. 16
1 I appreciate the opportunity to be here today to
2 testify before the House Labor and Industry Committee
3 regarding Representative Mackenzie's proposed legislation.
4 My name is Michael Vovakes. I'm the Deputy
5 Secretary for Compensation and Insurance at the
6 Pennsylvania Department of Labor and Industry.
7 As in the rest of the country, the opioid crisis
8 is a serious issue in Pennsylvania. Governor Wolf's
9 Administration is committed to doing everything we can to
10 help people who are already in the throes of addiction and
11 to prevent people from becoming addicted in the first
12 place.
13 It's not a stretch to recognize why this is an
14 issue in the workers' compensation arena. Workers become
15 injured. Sometimes they are prescribed medications that
16 can lead to addiction. We want to make sure that these
17 medications are being prescribed in an appropriate way to
18 help workers instead of harm them and to mitigate any
19 chances that people develop an addiction.
20 Governor Wolf has put forth a number of
21 initiatives to address this crisis, and we in Workers'
22 Compensation are certainly eager to support the effort in
23 whatever way we can.
24 Representative Mackenzie has proposed the
25 adoption of a nationally recognized prescription drug 17
1 formulary for the treatment of all injuries covered by the
2 Workers' Compensation Act. The Department supports this
3 proposal's basic objectives to ensure that injured workers
4 receive prescription drugs that are appropriate for their
5 injuries, which in turn could also reduce the costs
6 associated with workers' compensation claims.
7 In conjunction with various Administration
8 initiatives concerning opioid addiction in Pennsylvania, it
9 is the Department's desire to implement legislation that
10 will assist with the reduction of opioid abuse in the
11 workers' compensation system.
12 You have my written testimony. We have some
13 items that we think -- that we would like you to accept as
14 input to create a better bill out of this process. There
15 are two that I want to just take a moment to highlight.
16 The first and most notable concern with the
17 proposed legislation is the potential argument regarding
18 adequate standards or guidance to the Department in
19 selecting a formulary.
20 There is a case that is currently in the
21 Pennsylvania Supreme Court affectionately known as the
22 Protz case, and that case revolves around an
23 unconstitutional delegation of legislative authority
24 regarding the adoption and application of certain
25 guidelines and the evaluation of impairments. 18
1 So if we could further, or if you could further
2 articulate the basic policy considerations that you want to
3 effectuate through this legislation so that we can avoid a
4 similar situation, we think that would be very helpful.
5 Also, Sam talked about utilization review, as did
6 the good doctor. Utilization review is a dispute
7 resolution process that is used if there is a question
8 about the reasonableness and necessity of a treatment, and
9 this is a process that can be invoked by an employer, an
10 insurer, or an injured worker.
11 The provisions in the bill regarding utilization
12 review point to the Insurance Company Law of 1921. We just
13 want to acknowledge a couple of things: one, that there
14 are alternatives to certification, including URAC,
15 primarily URAC. I think they are the nationally recognized
16 accrediting body. And also that you consider a phase-in of
17 whatever you do so that we don't have a hard stop with only
18 a few utilization review folks or companies prepared and in
19 compliance with the standards.
20 So, you know, those are the two that I wanted to
21 call out. I'm happy to discuss this, Mr. Chairman.
22 MAJORITY CHAIRMAN KAUFFMAN: Thank you,
23 gentlemen.
24 We're going to move on to questions for the
25 panel, so if you have a question, make sure you get John's 19
1 attention here.
2 And I'm going to start with questions this
3 morning with Chairman Galloway.
4 MINORITY CHAIRMAN GALLOWAY: Thank you,
5 Mr. Chairman, and thank you all for being here today.
6 Good morning. I know we have got a lot of people
7 to talk to. We'll make it quick.
8 Good to see you. Good to see you again on this
9 issue.
10 I appreciate your points about opioids, first of
11 all, about alternatives, and I'd like to stick there for a
12 second.
13 First, is this bill just about opioids? Does
14 this affect just opioids or all medication?
15 MR. MARSHALL: All medications.
16 MINORITY CHAIRMAN GALLOWAY: You mean this bill
17 just doesn't apply to opioids, it applies to all
18 medications?
19 MR. MARSHALL: It's the drug formulary. It's
20 nationally recognized---
21 MINORITY CHAIRMAN GALLOWAY: Then why are we just
22 talking about opioids? Why don't we just have a bill that
23 concerns opioids?
24 MR. MARSHALL: If you want---
25 MINORITY CHAIRMAN GALLOWAY: Why aren't we going 20
1 with a formula for all medication? You mean, like
2 inhalers, everything prescribed by a doctor is falling
3 under this, yet that's all we're talking about is opioids?
4 MR. MARSHALL: And I think you'll hear from some
5 of the nationally recognized, evidence-based, you know,
6 people.
7 I'm not sure that -- I mean, frankly, I would
8 think you would want it for all drugs. I mean, if it's
9 good for opioids---
10 MINORITY CHAIRMAN GALLOWAY: That's fine, but you
11 didn't mention anything about that in your opening. Nobody
12 talked about, it's one point after another talking about
13 the opioid problem.
14 And we have taken significant steps in the last
15 couple of years in a bipartisan manner, the Prescription
16 Monitoring Program and others, which are the alternatives
17 that you brought up, yet that's all you talked about in
18 this whole bill, was opioids. Yet you never mentioned once
19 that it's not just opioids; it's every single drug, every
20 single prescription prescribed by a doctor. Why wasn't
21 that mentioned?
22 MR. MARSHALL: Actually, Representative Galloway,
23 I actually did point to that, and I say here, it says, for
24 all, you know, reasonableness of all prescriptions. You
25 know, it certainly includes opioids, and opioids highlights 21
1 the need for it.
2 I think that you would actually have -- and there
3 was reference made to the Protz decision. I think you
4 would actually have -- you know, I'm not sure why you would
5 say that we want drug formularies for one type of
6 prescription and not all others, and I would ask you---
7 MINORITY CHAIRMAN GALLOWAY: Well, because that's
8 where the problem is. You identified the problem. The
9 problem is with opioids. The problem is not with asthma
10 inhalers, right?
11 MR. MARSHALL: And, Mr. Chairman, if you want to
12 limit it, if you want to limit the drug formularies to just
13 opioids, then fine.
14 MINORITY CHAIRMAN GALLOWAY: I think the scope
15 would make a lot more sense.
16 MR. MARSHALL: I actually, I actually -- and you
17 guys have the votes, not anybody at this table. But I
18 would recommend that the Committee not go that route. I
19 think you want uniformity among all prescriptions.
20 If somehow you, and you're going to have the
21 chance to look at the---
22 MINORITY CHAIRMAN GALLOWAY: But then there has
23 to be a reason. There has got to be some reason for making
24 the change.
25 MR. MARSHALL: And I think that you're--- 22
1 MINORITY CHAIRMAN GALLOWAY: You are making the
2 case that there needs to be a change in the opioid, for
3 opioids, for an opioid problem. You know, some would argue
4 that we have made changes that are just coming into law
5 now. But you would have to make a case that there would
6 need to be a formula for every prescription.
7 MR. MARSHALL: And you know, Mr. Chairman, first
8 of all, on the changes that have already been made, they
9 really don't address the workers' compensation system. You
10 know, that's a unique problem.
11 MINORITY CHAIRMAN GALLOWAY: But is there a
12 problem other than opioids?
13 MR. MARSHALL: If you could, if you could -- you
14 know what? No. Opioids are what drive the problem. I
15 think treatment guidelines would be better overall, and I
16 would ask the Committee to consider that.
17 MINORITY CHAIRMAN GALLOWAY: And I appreciate
18 that.
19 MR. MARSHALL: But if you could, Mr. Chairman, I
20 do think, and I would urge it on all the people on the
21 Committee, I think that if you have drug formularies for
22 one type of prescription but not for all types of
23 prescriptions, I don't think that makes a lot of sense. I
24 think you want consistency across the board in how injured
25 workers are treated. 23
1 It shouldn't be, gee, you know what, if you fall
2 into this, you get one type of treatment; if you fall into
3 that, you get another type of treatment. I think you want
4 there to be a consistency throughout.
5 MINORITY CHAIRMAN GALLOWAY: Okay.
6 MR. MARSHALL: So if you're going to have
7 different drugs, you know, because opioids are one form of
8 drug, but other forms of drugs also address it. You would
9 want to have the same standards, the same guidelines
10 applying to all the drugs.
11 MINORITY CHAIRMAN GALLOWAY: I appreciate your
12 answer. And in an effort to move this along, just one last
13 quick question.
14 Do we know, and I' m going to stick on cost here
15 for a couple different speakers, all right? Costs, what
16 this is going to cost. I know that you probably can't
17 answer that or wouldn't answer it. What I want to know is
18 how this affects the insurance agency. Is this something
19 that's going to save you money?
20 MR. MARSHALL: We hope, but frankly, it's not an
21 insurance cost driver---
22 MINORITY CHAIRMAN GALLOWAY: Is it going to save
23 you money?
24 MR. MARSHALL: We hope.
25 MINORITY CHAIRMAN GALLOWAY: You don't know, Sam? 24
1 Come on.
2 MR. MARSHALL: You know what? If it don't--
3 MINORITY CHAIRMAN GALLOWAY: If it does, are you
4 going to return that money to the policyholders?
5 MR. MARSHALL: Yes. And we went through this, we
6 have gone through this any number of times in this
7 Committee and in other committees, Mr. Chairman.
8 As you know, our rates are regulated by the
9 State. If there is any cost savings, and we went through
10 this just recently a couple of years ago with the physician
11 dispensing bill, and those costs are required to be
12 reflected in the Pennsylvania Compensation Rating Bureau's
13 loss cost filing with the State.
14 This is not -- and, you know, you also overlook
15 the fact when you talk about insurance costs that the bulk
16 of the workers' comp market is self-insured, so obviously
17 any cost savings they generate.
18 What we don't -- you know, I can tell you, we
19 hope it reduces the opioid problem. I can't guarantee
20 that. I can point to records in other States--
21 MINORITY CHAIRMAN GALLOWAY: And there is some
22 automatic rollback that passes on the savings to the
23 policyholders.
24 MR. MARSHALL: You know what? I guess if you
25 wanted to have the same type of language that you have with 25
1 physician dispensing, that the Pennsylvania Compensation
2 Rating Bureau does a study for any savings that are
3 realized and---
4 MINORITY CHAIRMAN GALLOWAY: Is that in this
5 bill, that any savings that is generated to the insurance
6 company automatically goes back to the policyholders?
7 MR. MARSHALL: You know what? No, I don't
8 believe it is, but you know what? We'd be happy, we'd be
9 happy to have that amendment if that's, you know -- and we
10 have known each other a long time, Mr. Chairman, so, I
11 mean, I hope we can speak with the candor of people with a
12 mutual respect.
13 MINORITY CHAIRMAN GALLOWAY: We can.
14 MR. MARSHALL: We are not championing this bill,
15 supporting this bill, because it's going to save the
16 insurance industry a lot of money, that somehow wouldn't be
17 passed on to our policyholders in any event. We're
18 championing this bill, we're supporting this bill, because
19 we have seen empirical data that shows opioid abuse is a
20 unique problem in workers' compensation.
21 Now, you know, we're a pass-through. We make our
22 money one way or the other.
23 MINORITY CHAIRMAN GALLOWAY: Do we have that
24 data?
25 MR. MARSHALL: Yes. 26
1 MINORITY CHAIRMAN GALLOWAY: Did you pass that on
2 to us somewhere?
3 MR. MARSHALL: Yes, I did. I attached it as an
4 exhibit to my testimony, and we have submitted the full
5 WCRI reports. And I know some of it--
6 MINORITY CHAIRMAN GALLOWAY: Is the data related
7 to physicians that are overprescribing? Is that what
8 you're saying?
9 MR. MARSHALL: Yeah. What it shows is that
10 Pennsylvania is at the very high end of opioid
11 prescriptions in workers' compensation.
12 MINORITY CHAIRMAN GALLOWAY: I understand that.
13 And I'm all for--
14 MAJORITY CHAIRMAN KAUFFMAN: I think we need to
15 move on so other Members have a chance to ask some
16 questions.
17 MINORITY CHAIRMAN GALLOWAY: Thank you. Thank
18 you, Mr. Chairman.
19 MAJORITY CHAIRMAN KAUFFMAN: Because you're
20 Chairman, I offered a great amount of latitude to you.
21 MINORITY CHAIRMAN GALLOWAY: I appreciate it.
22 MAJORITY CHAIRMAN KAUFFMAN: Representative
23 Topper is next on the list.
24 REPRESENTATIVE TOPPER: I assume I won't have the
25 same amount of latitude. 27
1 Dr. Jacobs, a question.
2 It doesn't sound like you fear these standards.
3 It sounds like you practice medicines with standards every
4 day. Is that fair?
5 DR. JACOBS: Yes. But I have to say I was a very
6 unwilling participant in the beginning. But what I found
7 is that, following evidence-based guidelines, I had better
8 results, better outcomes, and that I can't argue with, and
9 I don't know that anybody can.
10 REPRESENTATIVE TOPPER: That's great.
11 In your conclusion, and I'll draw your attention
12 in your written testimony. It's point 4, and I think it
13 was the next to the last point you made as well. It says
14 there are other tools available to primary-care providers.
15 You mentioned acupuncture. You mentioned physical therapy.
16 Do you believe that just by simply establishing these
17 guidelines, that somehow you wouldn't be able to offer
18 those kinds of alternate treatments or do you think it
19 would encourage those alternate treatments?
20 DR. JACOBS: I think those alternate treatments
21 need to be part of the guidelines. I don't think you can
22 just tell somebody who has been on chronic pain meds for
23 20 years that they can't take them because of a formulary,
24 that it's not good. You have to give somebody an
25 alternative. 28
1 I have plenty of colleagues and friends that are
2 pain management physicians, that are thoughtful,
3 conscientious, and are trying to manage people that they
4 inherited, not their fault, and they're being told by
5 insurance companies -- sorry.
6 No, no; I mean, but it's a problem that it's not
7 being paid for. So I think any guideline needs to have
8 more than just opioids for this problem. I'm in agreement
9 with Sam on that.
10 REPRESENTATIVE TOPPER: Thank you very much.
11 MAJORITY CHAIRMAN KAUFFMAN: Thank you.
12 Next we'll go to Representative Neuman.
13 REPRESENTATIVE NEUMAN: Thank you, Mr. Chairman,
14 and thank you for your testimony today.
15 First, in terms of lines of alternative
16 treatment, within this piece of legislation, does it
17 require the workers' compensation to fully pay for
18 alternative treatments?
19 MR. MARSHALL: That's in the existing law. This
20 is an amendment to that law. So that in the existing law,
21 when you look at the definition of, I mean, what it covers,
22 or who are the licensed health-care providers, so we do
23 obviously cover physical therapy. I mean, that's a large
24 portion. And I believe we cover acupuncture, you know.
25 I mean, so there are any -- if you look at all 29
1 the providers that are covered under the Workers' Comp Act,
2 and therefore their services are covered under the Workers'
3 Comp Act, that is all the alternative therapies that we're
4 talking about today.
5 REPRESENTATIVE NEUMAN: Thank you.
6 And I think that we're all in agreement here on
7 the opioid epidemic. And the problem I have with Sam's
8 earlier comments is, if you want to talk about opioids, we
9 can talk about opioids, but I don't think everyone should
10 be treated as a guideline.
11 Not every injury is the same, and not every
12 doctor wants to prescribe the same drugs to help solve a
13 problem -- outside of opioids. I'm not talking about
14 opioids right now. But outside of opioids, I don't know if
15 we should treat every single injury and every single person
16 the same.
17 My question for Sam: Right now, I assume you
18 personally, as your own professional, you see addiction as
19 a disease?
20 MR. MARSHALL: Yes.
21 REPRESENTATIVE NEUMAN: Under workers'
22 compensation right now, can you get workers' compensation
23 for addiction?
24 MR. MARSHALL: No. You know, that would
25 actually, particularly if you became addicted during the 30
1 course of your treatment, that would then fall under your
2 health insurance coverage.
3 REPRESENTATIVE NEUMAN: So would you be open to
4 having workers that were addicted in some way be covered
5 under workers' compensation?
6 MR. MARSHALL: Sure, it would make sense to do it
7 under workers' compensation. I mean, that's where you get
8 -- I mean, that's where, and, you know, I'm happy to talk
9 to you about it further, but that's where the health
10 insurance comes in.
11 Your workers' comp coverage and the treatment of
12 the medical care for it covers your work injury. If the
13 doctor overprescribed and therefore you became addicted, or
14 by the same token, if the doctor, you know, cut off the
15 wrong arm, that would become, you know, more of either a
16 medical malpractice case where coverage is under the health
17 insurance policy.
18 REPRESENTATIVE NEUMAN: So you're saying if a
19 doctor overprescribes, that could be a medical malpractice
20 case?
21 MR. MARSHALL: Sure.
22 REPRESENTATIVE NEUMAN: I've never seen one of
23 them in medical malpractice.
24 MR. MARSHALL: You know, and I suspect that
25 people will start. 31
1 REPRESENTATIVE NEUMAN: So we're saying that the
2 workers' compensation system is causing addiction, is
3 causing all these opioid problems, but then we're not going
4 to allow the same system that is causing these problems to
5 solve these problems with long-term recovery?
6 MR. MARSHALL: That's because, for the patient
7 that gets poor care. I mean, that's what we're talking
8 about.
9 REPRESENTATIVE NEUMAN: Under the current
10 workers' compensation.
11 MR. MARSHALL: Under the current workers'
12 compensation system.
13 The medical costs of that poor care generally, I
14 think, would fall under his health insurance policy.
15 REPRESENTATIVE NEUMAN: So you're saying that if
16 a doctor overprescribes a patient opioids, that that would
17 be covered---
18 MR. MARSHALL: And the patient then goes into an
19 addiction program.
20 REPRESENTATIVE NEUMAN: That the doctor would be
21 liable for that?
22 MR. MARSHALL: No, no. I mean, actually, if you
23 have a situation where the injured worker gets addicted to
24 opioids and then -- so subsequent to, you know, he hurts
25 his back but then he gets addicted to opioids. 32
1 REPRESENTATIVE NEUMAN: Okay.
2 MR. MARSHALL: When he goes and gets treatment
3 for that opioid addiction, I believe, and I'll confirm on
4 this, but I believe that that is then covered under his
5 health insurance policy.
6 REPRESENTATIVE NEUMAN: But should it, because
7 most recovery plans aren't generally the treatment needed
8 for individuals to get into long-term recovery. So should
9 workers' compensation that you are claiming is causing this
10 big problem pick up after only 12 days of treatment, maybe
11 3 days of detox, that their health insurance is not picking
12 up?
13 MAJORITY CHAIRMAN KAUFFMAN: We're getting a
14 little bit far of the subject matter at hand and we have
15 other Members who are waiting in line to ask, hopefully,
16 questions that can add to the actual -- if you want to have
17 a sidebar conversation with Sam, I'm sure he would love to
18 do that, but I'm not sure that this is the topic right now
19 at this moment.
20 REPRESENTATIVE NEUMAN: I appreciate that,
21 Mr. Chairman. The discussions have only been on opioids
22 generally, and I think if we're going to only talk about
23 opioids and addiction problems, I think that we need to
24 discuss other things.
25 I will discuss those on a sidebar and private 33
1 matter, but I do appreciate the opportunity, Mr. Chairman.
2 MAJORITY CHAIRMAN KAUFFMAN: Thank you.
3 Representative Maloney.
4 REPRESENTATIVE MALONEY: Thank you, Mr. Chairman.
5 I will try to keep this short.
6 On the alternative treatments, something that has
7 been somewhat of a, I'll say a rub, probably, when you have
8 the medicine industry often, I'll say conflicting with what
9 somebody's actual pain is and why they have that pain.
10 In this alternative treatment, would there be
11 any reference to and maybe even the suggestion to
12 chiropractic?
13 DR. JACOBS: I don't see why not.
14 I mean, I think in the guidelines that I have
15 used, that's available. I'm thinking, particularly in
16 California, I know that they have set limits for physical
17 medicine. So it's not only chiropractic but also physical
18 therapy. I believe it's 24 over the lifetime of a case.
19 REPRESENTATIVE MALONEY: Yeah.
20 DR. JACOBS: But they are---
21 REPRESENTATIVE MALONEY: It has been my
22 experience in the past, and I have a family member right
23 now who suffers tremendously from muscle spasms and/or
24 nerve pinching and irritation, and really, the only true
25 treatment that helps that individual is chiropractic. 34
1 And when you look at the bone structure and the
2 things that we have, work related, and many guys like
3 myself who came from some of that, and also athletics, we
4 know that a treatment may not even remotely have to do with
5 any kind of medicinal type of pain management if we can get
6 to the problem. That's the only reason I was trying to, in
7 this evaluation of alternative-type treatments for people,
8 especially when they're hurt on the job, okay? That's why
9 I wanted to bring it up for just a little bit of
10 discussion.
11 I see it many times as something that could
12 really help us, and maybe economically, and physically for
13 those individuals. And I don't really hear -- we had,
14 actually, hearings in the last session over, we had
15 chiropractic individuals in here that spoke very highly of
16 how they can treat people. They alternatively don't have
17 to give them any kind of heavy medicine, or an opioid, for
18 that matter, since it's being brought up.
19 So I just wanted to put that out there, if that
20 would be part of this alternative-type discussion.
21 MAJORITY CHAIRMAN KAUFFMAN: Okay. Thank you.
22 We're going to move on.
23 We have one last question. Representative
24 Krueger-Braneky.
25 REPRESENTATIVE KRUEGER-BRANEKY: Thank you, 35
1 Mr. Chairman, and thank you, all of you, for your testimony
2 this morning.
3 My question is for the Department around
4 implementation. So in looking at the bill, we're talking
5 about a 30, a public comment period of no less than 30 and
6 no more than 90 days, and then the Department would be
7 required to select a nationally recognized prescription
8 formulary within 30 days after the close of the public
9 comment period.
10 Now, we know the Department has been under lots
11 of strain lately for other issues not related to workers'
12 comp. Is this a realistic timeline?
13 DEPUTY SECRETARY VOVAKES: I believe it is.
14 To my knowledge, there are only two, maybe more,
15 but two primary nationally recognized formularies. It
16 might get more complex if there are others that I'm not
17 familiar with. But if we have some good public comment, I
18 suspect that we could, we could commit to the timeline
19 captured in the bill.
20 REPRESENTATIVE KRUEGER-BRANEKY: And does the
21 Department have enough capacity with existing staff to
22 implement this fully?
23 DEPUTY SECRETARY VOVAKES: We do. And depending
24 on how the whole bill bakes out, we may have more capacity
25 to do work. 36
1 REPRESENTATIVE KRUEGER-BRANEKY: Can you clarify
2 that, please?
3 DEPUTY SECRETARY VOVAKES: If the URAC
4 certification stays in the bill, that may alleviate some of
5 the requirements, some of the work requirements we have
6 internally to certify utilization review folks, which, you
7 know, we could use folks to do some other things as well.
8 REPRESENTATIVE KRUEGER-BRANEKY: All right.
9 Thank you, Deputy Secretary.
10 DEPUTY SECRETARY VOVAKES: Certainly.
11 MAJORITY CHAIRMAN KAUFFMAN: Thank you very much
12 to the panel, and in the interests of time, we're going to
13 move on. There may be some follow-up questions coming from
14 Members, so I anticipate the panelists will be happy to
15 answer those questions, as we, I believe, have mentioned
16 that to you before.
17 Next, the Committee will hear testimony from
18 Joseph Huttemann, representing the Pennsylvania Association
19 for Justice. With Mr. Huttemann, to assist in answering
20 questions, is Mr. Thomas Baumann, I believe.
21 And Mr. Huttemann, if you would like to take the
22 microphone, and you have 5 minutes to address the Committee
23 and then we'll go with questions.
24 MR. HUTTEMANN: Good morning, Chairmen Kauffman
25 and Galloway and Members of the Committee. Thank you for 37
1 allowing me to present testimony today in regards to
2 House Bill 18 .
3 My name is Joseph Huttemann, and I'm an attorney
4 for 25 years, practicing workers' compensation law.
5 My first 5 years I worked as a defense attorney
6 for the insurance side of things. I moved on to represent
7 injured workers for the last 20 years.
8 Before going to law school, I was a construction
9 worker and a schoolteacher. I worked day in and day out
10 with the workers of this State, your constituents. I'm
11 here on behalf of the Pennsylvania Association for Justice,
12 my organization that protects the rights of the citizens of
13 this State.
14 In being a workers' compensation lawyer
15 representing individuals for the last 20 years, I field the
16 calls every day of injured workers, catastrophically, when
17 their medications are denied, when treatment is denied. I
18 deal with the reality of a work injury, not just the
19 dollars and cents.
20 This law that's being proposed, and I have
21 listened to all the discussions here this morning about the
22 opioid crisis, and I think we all can agree that that is a
23 substantial issue. And in the last year, there have been
24 several laws that have been brought forth by this group,
25 which I hope will have a strong effect on that crisis. As 38
1 of right now, we don't know the effect of that. We can
2 hope that that does move forward and take care of issues.
3 The law as drafted, as pointed out by
4 Representative Galloway, addresses all medications,
5 everything -- lung injuries, heart injuries, everything.
6 It's broad, and does it really address the opioid issue?
7 It sets forth a formula, a guideline from a
8 nationally recognized organization. I don't know which
9 one. But that guideline will set forth the brand, dosage,
10 the duration of medications to be prescribed. That doesn't
11 necessarily address the issue of opioid addiction.
12 Opioids may be the only prescription available
13 for treatment of certain injuries. Putting a guideline on
14 what doctors can prescribe and treat, or choose to treat
15 their patients with, drives a wedge in that sacred
16 doctor/patient relationship.
17 I was listening to Tom Price testify last week in
18 his confirmation hearings to be Health and Human Services
19 Secretary. Dr. Price, as we know, he's a physician. He
20 was appointed by the Trump Administration. And the gist of
21 his testimony about abolishing Obamacare or the Affordable
22 Care Act was that doctors and patients make the best
23 decisions about medical care. Not guidelines, not
24 regulations, but the doctor and patient make that best
25 decision. 39
1 And I think that there is wisdom in that, because
2 every injury is different. Every injury does require the
3 doctor to have the ability to reach into his toolbox and
4 pick the right tool, not have some national organization
5 dictate what tools are to be used.
6 As we all know, the workers' compensation system
7 was enacted over 100 years ago as a grand bargain.
8 Employees gave up their right to sue their employers for
9 personal injuries in exchange for being given two basic
10 benefits: wage losses and medical care. This reduces the
11 value of that grand bargain, and that grand bargain has
12 continually been attacked.
13 I want to read something to you that I found last
14 night when I was thinking about my testimony today. Here
15 is a State where there are guidelines on prescriptions and
16 guidelines on medical care in general. The New York Times,
17 November 30, 2016, quote, the title of the article,
18 " 'Victimizing Me All Over Again': San Bernardino Victims
19 Fight for Treatment":
20 "A year after a terrorist's bullets ripped
21 through her, after so many operations and infections she
22 has lost count, Valerie Kallis-Weber has a paralyzed left
23 hand, painful bone and bullet fragments in her pelvis,
24 psychological trauma and tissue damage, including a
25 fist-size gouge in her thigh where a bullet tore away the 40
1 muscle.
2 "Ms. Kallis-Weber, a survivor of the shooting
3 in San Bernardino, Calif., that left 14 people dead and
4 22 seriously injured, still faces a long, hard road to
5 reach something like recovery. She needs more operations,
6 she relies on a home health aide, and her doctors want her
7 to get physical" therapy "and occupational therapy to
8 relearn" how "to use her arms and legs.
9 " 'I can't type, I can't put a bra on, I can't
10 cut a steak... I can't do laundry, I can' t wrap a
11 present.... I need help with everything.' " That's her
12 quote.
13 "But the visits from the" home "health aide have
14 been reduced, and she has been told they will end soon.
15 Approval of her antidepressant medication was withdrawn.
16 Her occupational therapy was cut off, and her physical
17 therapy" was "stopped, restarted and stopped again.
18 "Her conflicts over treatment are not with her
19 health insurance plan; the shooting on Dec. 2, 2015, was a
20 workplace attack, not covered by..." her "insurance.
21 Instead, her treatment comes under the workers'
22 compensation system, which in California..." restricts its
23 coverage through guidelines.
24 "Ms. Kallis-Weber and other victims of the
25 attack, all San Bernardino County employees, have spent 41
1 months fighting the county and private" insurance
2 "companies that help administer the system, as treatments
3 that their doctors approved have been delayed or denied."
4 Let's not make Pennsylvania California.
5 MAJORITY CHAIRMAN KAUFFMAN: Thank you.
6 And now we're going to open it up to questions,
7 and I guess I'm going to start.
8 Is your intent today to say no, or do you have
9 suggestions on how we can improve this bill? Because, you
10 know, I want this to be focused on people and workers, and
11 I believe Pennsylvania is in the top three in opioid abuse
12 within the workers' comp system.
13 I mean, we are out -- I think our testifiers will
14 get to it in the next panel, some of the abuses that we're
15 seeing. And so I guess I'm of the thought of, just saying
16 no, I think that was a mantra back in the Nancy Reagan
17 years, but this bill, I don't think just saying no is the
18 answer to this bill.
19 We're looking for constructive improvements
20 and constructive criticism rather than saying, no, we
21 don't want any of this. Do you have improvements for the
22 bill?
23 MR. HUTTEMANN: Well, I think that we have to see
24 what the outcome of the legislation passed last year was -
25 the Prescription Drug Monitoring Program; the physician 42
1 dispensing rules. All those are just being implemented,
2 and to say we're going to bring this ax in, this
3 sledgehammer to take on a fly, and it' s not a fly but it is
4 a specific problem.
5 I don't believe that this act actually addresses
6 the issues, because what it does do is it takes people who
7 are most severely injured and puts them in a position where
8 they may have to go out onto the street to get drugs.
9 I've seen it. I've seen when a utilization
10 review cuts off my client's care, and while it's litigated
11 out, they have gone to the street, all right? So I don't
12 know that this act actually helps, and it may hurt the
13 crisis by pushing people in a different direction.
14 I know this question was, if not this, then what?
15 And as I thought about that question, if this, then what?
16 And when I think of "if this, then what, " and I see people
17 being pushed into a direction of using self-medication or
18 having to go to spinal cord stimulators and pain pumps at
19 extreme costs, I think the question is, is this law in any
20 way helpful?
21 MAJORITY CHAIRMAN KAUFFMAN: All right. I think
22 that was a no. I'll just say no. I think so, anyway.
23 Next we will go to Representative Mackenzie.
24 REPRESENTATIVE MACKENZIE: Thank you,
25 Mr. Chairman. 43
1 First off, I would like to apologize for running
2 late this morning, but I do want to thank you for holding
3 the hearing.
4 So Mr. Huttemann, I guess I want to just follow
5 up on the Chairman's question. So you have described that
6 there are problems in the current system. Have you ever
7 offered any proposals or solutions to those problems that
8 you described?
9 MR. HUTTEMANN: I haven't proposed any
10 legislation.
11 REPRESENTATIVE MACKENZIE: Okay.
12 At the last hearing that we held last session, I
13 had an open-door policy and offered everybody in attendance
14 to contact us and offer suggestions. Did you take me up on
15 that?
16 MR. HUTTEMANN: I did not. I was not here.
17 REPRESENTATIVE MACKENZIE: Thank you,
18 Mr. Chairman. That concludes my comments.
19 MAJORITY CHAIRMAN KAUFFMAN: All right.
20 Moving on, Representative Neuman.
21 REPRESENTATIVE NEUMAN: Thank you, Mr. Chairman,
22 and thank you for your testimony today.
23 In your experience dealing with your clients, the
24 same injury, different client, do you see that the same
25 treatment worked for those two different clients? 44
1 MR. HUTTEMANN: No. I think every client is
2 specifically individual.
3 It is a case-by-case basis, and that is why these
4 regulations, these cookbook formulas for treatment, are not
5 good.
6 REPRESENTATIVE NEUMAN: And when it comes to the
7 opioids, would you be open to at least just discussing that
8 portion, because that seems to be what they are tying a
9 national formulary onto, an epidemic. It seems
10 disingenuous to do that. Would you be willing to parse
11 that out to talk about opioids and see if there is a
12 pathway for reform in the workers' compensation, just
13 dealing with opioids?
14 MR. HUTTEMANN: I think so. I think that a good
15 discussion can occur in that direction.
16 I do recognize that the addiction issue is
17 severe. You know, it's something that needs to be
18 addressed. I think that addressing it in this manner is
19 not effective.
20 I do want to go back and correct some questions
21 that Mr. Marshall had from you, or to you, about whether
22 addiction is covered under the workers' compensation
23 system.
24 When a client does become addicted, they are
25 covered under the Workers' Comp Act, and if they end up 45
1 passing away as a result of addiction, it is covered under
2 the Workers' Comp Act. So those costs aren't pushed on to
3 the public; those are retained within the workers' comp
4 system.
5 I just wanted to correct the record on that.
6 REPRESENTATIVE NEUMAN: Okay. I do appreciate
7 that.
8 And now that you're at this hearing, I would
9 encourage you that if you do want to talk to the maker of
10 the bill, I know that he is willing to talk to you. So I
11 would appreciate that.
12 MR. HUTTEMANN: Yeah. I would absolutely look
13 forward to doing that.
14 MAJORITY CHAIRMAN KAUFFMAN: Representative
15 Chairman Galloway, I'll go to you next.
16 MINORITY CHAIRMAN GALLOWAY: Thank you,
17 Mr. Chairman. Real quick.
18 To address the point made by the Chairman, the
19 Majority Chairman, about, if not this, what; just say no.
20 I want to address a couple of things: how to make this
21 bill better.
22 This bill appears to be a shell. There is no
23 "it" to it, right? There's no policy; there are no regs.
24 We don't know the formula. We don't know the company. We
25 don't know the costs. Speak to improving the bill as it 46
1 relates to taking a blank piece of paper and actually
2 putting something down onto it.
3 MR. HUTTEMANN: Well, the only way that the bill
4 could be palatable, in my opinion, is if it was restricted
5 down to the narcotic medications. But I do believe it may
6 be better to address the issue directly with the physicians
7 who are prescribing these medications and having rules upon
8 them, not under a workers' compensation formulary.
9 MINORITY CHAIRMAN GALLOWAY: We know what the
10 doctors -- have the doctors weighed in on this issue? Do
11 we know what---
12 MR. HUTTEMANN: They did provide a statement, the
13 orthopaedic group provided a statement, and they did
14 discuss how they're going to be working on self-regulating
15 themselves and reducing and monitoring much better.
16 MINORITY CHAIRMAN GALLOWAY: Are they for or
17 against this bill? Do we know?
18 MR. HUTTEMANN: It indicated in its current form
19 that they are against it.
20 MINORITY CHAIRMAN GALLOWAY: All right. Thank
21 you.
22 MAJORITY CHAIRMAN KAUFFMAN: Thank you, Chairman
23 Galloway.
24 And last, I'm going to go to Representative Dush.
25 And there are others who have asked to be on the list, so 47
1 if you have questions, we will get those to Mr. Huttemann
2 and we will get those answers to you.
3 So Representative Dush, you are last.
4 REPRESENTATIVE DUSH: Thank you, Chairman.
5 First, one of the things about the grand bargain
6 here, the workers do have the option to sue when they're
7 not getting their treatment. You wouldn't be in business
8 if they couldn't.
9 Secondly---
10 MR. HUTTEMANN: They have the option to sue to
11 get workers' comp. They do not have the option to sue for
12 pain and suffering as any other party would have against a
13 third party who was injured. So no, they don't have the
14 right to sue.
15 REPRESENTATIVE DUSH: To my question, in the
16 number of States where this is actually currently going on
17 where they do have the formularies, what are the issues
18 that are causing all the things that you foresee as being a
19 detriment with this bill?
20 MR. HUTTEMANN: Well, it creates a situation
21 where there's an automatic denial of medical care while it
22 goes through utilization review. No one pays for it at
23 that point.
24 I've had clients take out loans on their home in
25 order to get payment under the current utilization review 48
1 setup in Pennsylvania. The way that these formularies are
2 set up, nothing gets paid at all if it falls outside the
3 formulary.
4 Now, I could tell you that in Florida, there has
5 been such an attack on the workers' compensation benefits
6 that a Supreme Court Justice in the last few years
7 indicated that the grand bargain was so corrupted, that the
8 employee had the right to sue the employer for pain and
9 suffering.
10 REPRESENTATIVE DUSH: Is that directly related to
11 what we're talking about here?
12 MR. HUTTEMANN: It's in terms of some other
13 benefits.
14 REPRESENTATIVE DUSH: Thank you. So it's
15 not--
16 MR. HUTTEMANN: Well, correct.
17 REPRESENTATIVE DUSH: Thank you.
18 MAJORITY CHAIRMAN KAUFFMAN: All right. Thank
19 you. We do have to move on.
20 Thank you very much for being here. We possibly
21 have some follow-up questions, if Members would want to
22 submit those to my office and we will get those answered.
23 MR. HUTTEMANN: Thank you.
24 MAJORITY CHAIRMAN KAUFFMAN: And the next panel
25 we have here today: Carlos Luna, the Director of 49
1 Government Affairs for the Reed Group; Kenneth Eichler,
2 Vice President at Work Loss Data Institute; and
3 Aaron Turner-Phifer, Director of Government Relations of
4 URAC.
5 And I appreciate you very much being here today.
6 All three of these gentlemen came from out of town, and two
7 of them came from great distances to be here, Florida and
8 Colorado. So I thank you very much for being a part of
9 this today.
10 And I am going to open it up, first to you to
11 start out. These gentlemen, I'm going to bunch them
12 together and I'll let them present together, but we'll
13 start with you, Aaron.
14 MR. TURNER-PHIFER: Sure. Thank you,
15 Mr. Chairman.
16 My name is Aaron Turner-Phifer, Director of
17 Government Relations at URAC. I'm based out of DC.
18 I just want to do a couple of things real quick
19 so we can have time for questions. Just give a little bit
20 of background about who we are, what we do.
21 As a disclaimer, as a not-for-profit independent
22 organization, we don't take policy or political positions.
23 So my role here is to provide background and market
24 expertise about what we have seen across the country with
25 respect to utilization review. 50
1 I would also note that we are the country's
2 largest accreditor of pharmacy services, so PBMs, specialty
3 pharmacies, mail-order pharmacies. So I'm happy to field
4 any questions about formularies as well.
5 But specifically about utilization review. I
6 want to just highlight that from our perspective as an
7 organization focused on setting quality standards and using
8 best practices. We're focused on ensuring that
9 organizations have a process to drive reliable outcomes for
10 injured workers, and that means protecting workers from
11 medically unnecessary care that may in fact do harm in the
12 end.
13 So one of the issues that has been brought to my
14 attention here in Pennsylvania is that the utilization
15 review process as it stands now, there's a high degree of
16 variability, potentially a high degree of variability in
17 the process. So one of the ways you can control for
18 quality for the injured worker is to drive a process that
19 is structured around best practices that ensures the
20 injured workers are getting fair and equitable treatment
21 based off of evidence, but not to say that every worker is
22 treated the exact same way.
23 So guidelines are in fact guidelines. They are
24 not meant to be protocols. There is a process in place to
25 ensure that exceptions are made for those injured workers 51
1 that don't fit the guideline.
2 Our role in Pennsylvania: We currently accredit
3 65 organizations that have actual brick-and-mortar
4 locations here in Pennsylvania. Specifically, eight of
5 those hold utilization review accreditation. The list of
6 those organizations is included in my testimony.
7 I'll highlight, the last gentleman mentioned some
8 of the issues that are happening in California. I think
9 that was a great example.
10 California, last year, actually passed
11 legislation to reduce variability in their utilization
12 review process, and one of the things that they did was
13 require accreditation. So we're in the process now of
14 working with the State of California to ensure that there
15 is some quality controls around the utilization review
16 process based off of what other States are doing as well.
17 Finally, I just want to highlight, what can
18 accreditation do for the opioid issue?
19 The thing that struck me is, in this conversation
20 that I have had over the last year, is States are starting
21 to engage in this more and more. This isn't an issue
22 that's unique to workers' compensation. It may be a
23 highlighted issue in workers' comp, but it's an issue that
24 the medical community broadly is facing.
25 The solution to the opioid issue isn't going to 52
1 be solved in workers' compensation; it's going to take the
2 entire system. So we often talk about injured workers as
3 if that's some different thing than an actual patient.
4 When a worker gets injured, they are a patient and they see
5 their physician.
6 The response from the system has to be one that
7 is holistic, that's focused on improving the care that a
8 patient receives, regardless of who's paying for it.
9 That's what the accreditation is meant to do. Regardless
10 of what market that business is operating in, it' s focused
11 on quality care for the patient.
12 So what the accreditation does for the opioid
13 issue is it creates a structure around the process and
14 allows you to identify issues and target your activities
15 around resolving that problem. So accreditation alone
16 isn't going to solve the issue, but it is a framework by
17 which you can base decisionmaking to engage in the problem.
18 And I just wanted to highlight something that the
19 Secretary said. We would, if you should so choose to move
20 legislation that includes an accreditation requirement, we
21 would encourage a phase-in period. It typically takes
22 about 10 to 12 months for an organization to go through the
23 process. Especially if organizations haven't gone through
24 the process before, it could take a little bit longer. So
25 we would encourage a phase-in period with that. 53
1 So with that, I will pass it on.
2 MR. LUNA: Good morning, Honorable House Labor
3 and Industry Committee Chairs and Members.
4 My name is Carlos Luna. I am the Director of
5 Government Affairs for Reed Group, owners of the
6 ACOEM-based Drug Formulary and Practice Guidelines
7 researched and developed independently by the American
8 College of Occupational and Environmental Medicine.
9 I also serve on the Research and Standards
10 Committee, Disability Management and Return to Work
11 Committee, and Medical Issues Committee for the
12 International Association of Industrial Accident Boards and
13 Commissions, also known as the IAIABC, and the Claims
14 Administration Committee and Medical and Rehabilitation
15 Committee for the Southern Association of Workers'
16 Compensation Administrators, or SAWCA.
17 I'm here today to share, from my perspective, how
18 drug formularies can be used to improve the quality of
19 medical care provided to injured workers to restore
20 function post-injury or illness and avoid dangerous health
21 effects, like prescription drug addiction due to
22 inappropriately prescribed drugs.
23 I would like to focus my comments this morning on
24 the following: what is a drug formulary; and secondly, who
25 benefits most from a drug formulary. 54
1 The formulary concept, as has been said today, is
2 not a new concept. The earliest version that I could track
3 down was possibly from the 1700s. The purpose of the early
4 versions of a formulary was to define a standard for the
5 compounding and dispensing of medications in U.S. military
6 hospitals, and by the late 1950s, early ' 60s, formularies
7 had been adopted by nearly every hospital in the country.
8 The concept of a formulary has since evolved well
9 beyond the simple drug list of its origins. In fact,
10 today's options include formularies that consider the
11 patient's medical condition, whether their condition is in
12 the acute or chronic phase, and provides visibility to the
13 strength of scientific evidence. This modern application
14 allows prescribers to take into consideration each
15 patient's unique medical needs.
16 Modern formulary versions also have clear links
17 to the scientific evidence, helping all stakeholders,
18 providers, payers, employers, and employees have access to
19 view the science that supports the drug's recommendation,
20 or lack thereof. These modern traits ensure that the right
21 pharmacological therapy is provided to the right people at
22 the right time.
23 Health benefits to injured workers are achieved
24 by a formulary's separation of drugs into two categories
25 using scientifically and evidence-based information: 55
1 formulary drugs and non-formulary drugs.
2 Formulary drugs are preselected, are preferred,
3 and their delivery can be simplified and expedited to
4 injured workers. The primary goal of these drugs in work
5 comp is to keep injured workers safe from the negative
6 effects of drugs that are not medically necessary, are
7 overly prescribed, or are not proven to be effective.
8 Non-formulary drugs, on the other hand, are not
9 part of this expedited, streamlined approach and will
10 require preauthorization. Please note, this does not mean
11 that non-formulary options are definitively unavailable to
12 injured workers. It does mean, however, that based on the
13 preponderance of evidence and expert medical consensus,
14 these options may not be the most effective, medically
15 necessary, or serious risks and adverse effects outweigh
16 the benefits to the patients, thus requiring prospective
17 utilization review prior to dispensing.
18 Some jurisdictions, like California, create
19 "special fill" policies, making certain that certain
20 non-formulary drugs are available to patients for short
21 periods of time while the prospective utilization review is
22 completed.
23 The exceptions process from the formulary that is
24 implemented along with the formulary cannot and should not
25 be overly cumbersome. Patients should not be denied 56
1 medically necessary treatment.
2 Based on the information that I have provided
3 respective to what a drug formulary is and what it is
4 intended to do, you may now be able to reach a conclusion
5 on what a formulary is not:
6 A formulary is not a license to say no to
7 patients.
8 A formulary is not a cost-containment tool.
9 A formulary is not a blunt instrument.
10 A formulary is a tool to help guide medical
11 decisions on best, most effective pharmacological care for
12 the functional restoration of injured workers.
13 Now, who benefits most from a drug formulary?
14 A properly implemented and regulation-supported
15 drug formulary provides multifaceted benefits to various
16 system stakeholders in work comp. The health benefits to
17 the injured worker, by far, are the most important.
18 In California, where according to the California
19 Workers' Compensation Institute report, "A Review of
20 Preferred and Non-Preferred Drugs," which was published in
21 August of last year, 27 percent of all California work comp
22 prescriptions were opioid analgesics. All of the opioids
23 are listed as non-formulary or nonpreferred drugs, while
24 the exception of limited "special fill" prescriptions that
25 are subject to prospective utilization review exists. 57
1 Also addressed as nonpreferred drugs are bulk
2 chemicals, which are raw ingredients for compound drugs.
3 They represent only 3 percent of prescriptions and
4 11 percent of payments. They are considered non-formulary,
5 making them subject to prospective utilization review.
6 The report also identified that the top 20 common
7 brand-name drugs within the study sample represented the
8 majority of all prescriptions of the State' s formulary's
9 preferred drugs.
10 As far as California goes and certainly for
11 Pennsylvania, the formulary would provide a framework that
12 requires meticulous consideration, through prospective
13 review, of drugs that have been proven to have more risks
14 associated with them, are considered experimental or
15 non-FDA approved, like compound drugs, and expedites the
16 delivery of drugs that are proven to be safe, effective,
17 and restore function to the injured worker.
18 I hope that I have provided some insight to you
19 this morning that will allow you to give thoughtful
20 consideration to passing legislation around a drug
21 formulary. As echoed today multiple times, it's not about
22 the numbers, it's not about the costs; it's about the lives
23 that are being impacted, not only by opioid prescription
24 drugs but also by other potentially dangerous drugs
25 available to workers' compensation patients. 58
1 Thank you.
2 MR. EICHLER: Representative Kauffman,
3 Representative Galloway, Members of the Committee, thank
4 you for having me today.
5 My name is Ken Eichler. That's E-I-C-H-L-E-R. I
6 am Vice President with ODG/Work Loss Data. We are a
7 division of the Hearst Health Network. We publish the
8 formulary and guidelines that have been adopted in most of
9 the States across the country that have adopted
10 formularies.
11 In preparing for testimony, I had a conversation
12 on Monday with an esteemed colleague of mine, a gentleman
13 named Bill Zachry. Bill ran the workers' compensation and
14 risk management programs for Safeway and Albertsons, one of
15 the largest grocers in the country here.
16 In preparing for the testimony, Bill gave me a
17 wonderful piece of advice. Bill has done reform across the
18 country and has been a good mentor to me. He said, Ken,
19 rip up your testimony and be real. He said, give the basic
20 numbers, talk about how this is going to impact business,
21 talk about how it's going to impact injured workers, and
22 talk about how it's going to change lives. He said, also
23 be responsive to the Representatives who are at the hearing
24 today. So in doing so, I did abandon the standard
25 presentation and came up with some notes as we were going 59
1 and some key points.
2 As Carlos mentioned, what is a formulary? A
3 formulary is basically a list, and we all have formularies
4 in our lives, whether it's in group health, and believe it
5 or not, here in Pennsylvania, most of the PBMs and
6 insurance companies do utilize formularies of some sort,
7 but they're silent formularies.
8 The adoption of a comprehensive formulary here in
9 Pennsylvania will open the playbook, so to speak. It
10 levels the playing field, and it puts everybody on equal
11 standing, guaranteeing standards for all injured workers.
12 We have got to protect the injured workers, but we've got
13 to expedite the delivery and access to those medications.
14 Why do people focus on opioids? It's sexy, it
15 gets publicity, and it's what's killing people, but the
16 formularies go far beyond that. Representative Galloway
17 and others asked about the access to other medications and
18 what does the formulary do on that: It expedites the
19 delivery.
20 If you turn to any physician that is a
21 specialist, there has been a cadre of maybe 10 to
22 15 prescriptions or medications that they generally use in
23 their practice for an orthopod, a neurologist, an
24 ophthalmologist, and the like. An internist is going to
25 use many other medications. 60
1 By having a formulary, it's basically bucketing
2 the drugs into two lists. One is a list that does not
3 require preauthorization, which is the majority of the
4 drugs. It's a FastPass. It's an E-ZPass. It gets it
5 through quickly and gets the drugs into the hands of the
6 injured worker.
7 The drugs that do require preauthorization, the
8 nonpreferred drugs, are a stop and pause. That's a chance
9 to stop and think about it: think about whether that
10 medication is appropriate and whether there are
11 alternatives.
12 And the name is blocked, but I'm sorry, the
13 Representative in the back corner had asked about
14 chiropractic care and alternative care. What a formulary
15 further does is encourages the use of alternative
16 treatments other than just turning to chemicals to treat
17 and help the injured worker to get better. We have got to
18 do what's right by the injured worker.
19 I'll toss a couple of facts and figures out to
20 you and some other basic information in response to
21 questions that were raised.
22 On the issue of the drugs and how does it impact
23 folks, I'll give you an example. Let me stop for a second
24 and ask you to all ask yourselves a question: Is there
25 anyone in this room that does not have a friend, a family 61
1 member, a member of their church, a business associate, or
2 somebody they know who has not been impacted by opioids
3 negatively? I doubt there are very many people that could
4 raise their hands and say they haven't been touched within
5 just a couple of degrees of separation.
6 In Texas, which was the leader in using
7 formularies, prior to formulary, there were over 15,000
8 people on over 100 morphine equivalents a day. That's a
9 lot of morphine equivalents. Those are the people who get
10 into trouble. Post-formulary, there are less than
11 500 individuals in the State of Texas workers' compensation
12 receiving those levels of opioids. It protects those
13 injured workers.
14 No State that has adopted a formulary -- and
15 there are several that have, either self-developed or gone
16 with a commercial formulary -- has turned back. Every
17 State has had success.
18 I serve on the committees, as does Carlos. I
19 have chaired the committees with the IA, with SAWCA, with
20 others. I'm an appointed member of the advisory council
21 that's available to regulators and Legislators. And I'll
22 tell you, Director Weiant from Labor and Industry has those
23 resources, can speak to the other regulators, has spoken to
24 those other regulators, and can document that these
25 formularies work and expedite the care, expedite the 62
1 treatment.
2 I've got to move quickly here.
3 Texas. I'll give you some quick numbers as far
4 as the results, because that was asked, as far as costs and
5 whatnot.
6 NCCI, by the way, the National Council on
7 Compensation Insurance, has done predictions that the
8 adoption of the formulary, depending upon the State, will
9 drop the cost between 10 and 20 percent overall while
10 expediting care.
11 In Texas, the numbers -- and this I just got from
12 the former commissioner, who is still involved in Texas -
13 that the number of prescriptions overall since the
14 formulary has been down 10 percent. And that's changing
15 doctor-prescribing patterns, because when the docs know
16 what can be easily authorized, they go forward with it. It
17 doesn't deny care.
18 You've got the overall risky drugs, the ones
19 requiring preauth, down 7 6 percent. You've got an
20 11-percent drop on opioids. You got an 81-percent drop on
21 the spend of those risky drugs. The total costs for all
22 medications are down 15 percent, and the nonpreferred drugs
23 are down 85 percent. The more current numbers are
24 currently being tabulated for Texas.
25 Overall, it works. It empowers the physician, 63
1 and it does nothing but have positive results.
2 MAJORITY CHAIRMAN KAUFFMAN: Thank you,
3 gentlemen, for your testimony.
4 And in starting questions, I'm going to start
5 with Representative Delozier.
6 REPRESENTATIVE DELOZIER: Thank you,
7 Mr. Chairman.
8 I have two quick questions for Mr. Luna. Thank
9 you all for your testimony.
10 Mr. Luna, in your testimony you bring up the
11 issue of acute versus chronic, obviously within the
12 diagnosis that we have with our workers. Along that same
13 line, you also bring up the unique medical needs.
14 So we have had testimony where it was stated that
15 everyone is treated the same and just cut off at certain
16 points. So can you address that point that you made in
17 your testimony about their ability and the doctor's ability
18 to address the uniqueness of every case, which was
19 mentioned; everybody is a little bit different. So can you
20 address your comments on that.
21 MR. LUNA: Absolutely.
22 I certainly don't want to take away from the
23 gentleman's testimony before me. I do believe that there
24 might be outliers out there where parties may use a tool,
25 like a formulary, in an inappropriate manner. However, I 64
1 think by popularity, and really far and large, I think
2 you're going to find providers utilizing these tools with
3 wisdom and with common sense.
4 It's true that not all prescription drugs are
5 appropriate for all people all of the time, and I would be
6 the first to admit that not every single person or not
7 everybody in this room is the same and has the same medical
8 needs.
9 I think the concept of formularies has come a
10 long way since the 1700s. I think that had we continued
11 to implement that type of system, you would very well have
12 patients that are cut off, that are, unfortunately, denied
13 care that their physician feels that they need. But in
14 this day and age, if you speak with other State
15 jurisdictions that have enacted formularies, I think
16 you're going to find that the majority of patients that go
17 beyond the formulary options are actually afforded those
18 medications because their physicians do the due diligence,
19 do the research, to substantiate that their patients'
20 medical conditions actually require these medications.
21 A formulary is not a license to say no. It is
22 not a mechanism to interrupt medical care for anyone. It's
23 a tool to add additional consideration to whether or not
24 this prescription is appropriate for the patient.
25 It allows patients to point to a resource other 65
1 than their own expertise and knowledge. In fact, many
2 doctors that are advocates of evidence-based medicine,
3 particularly formularies, will admit to you that their
4 initial response was somewhat hesitant to utilize it. But
5 once they actually begin to utilize the tool, it provides
6 them a lot more support from a scientific evidence
7 standpoint to be able to support their recommendations to
8 their patients.
9 MR. EICHLER: If I can weigh in on one comment to
10 that as far as physician participation.
11 REPRESENTATIVE DELOZIER: Okay.
12 MR. EICHLER: Physicians will initially flinch,
13 as would anyone with any potential regulations about to be
14 imposed on them. But the facts and the statistics show
15 that Texas and every other State that has developed a
16 formulary has greater physician participation now with
17 decreased transactional processes and delays at the
18 physician's office than ever before. It makes it easier
19 for them.
20 REPRESENTATIVE DELOZIER: Okay. And just, if I
21 could, just one other follow-up, Mr. Luna.
22 You mention in your testimony, in California,
23 only 27 percent were opioid prescriptions? Did I read that
24 right, or do I have that---
25 MR. LUNA: Correct; 27 percent of the overall 66
1 worker's compensation prescriptions.
2 REPRESENTATIVE DELOZIER: That just seems low to
3 me, considering we've been having a conversation as to the
4 high level of opioid overuse and then, therefore,
5 addiction.
6 So the 27 percent. So a majority in California,
7 according to this report then, is not opioid prescriptions;
8 they are the lesser, and I'm not a doctor so I don't know
9 the official term for them, but they're not the opioids, so
10 they' re not the ones that people are getting as addicted
11 to. So I guess that kind of conflicts with some of the
12 things that we have been hearing as to how high the opioid
13 prescriptions are.
14 MR. LUNA: Twenty-seven percent, to put it into
15 context is, one out of every four pills that is prescribed
16 in the State of California for workers' compensation is an
17 opioid. I think that that also speaks to the question of,
18 are we just dealing with an opioid problem? The answer is
19 no, we're not.
20 REPRESENTATIVE DELOZIER: There are lots of other
21 ones that are out there as well.
22 MR. LUNA: Correct.
23 REPRESENTATIVE DELOZIER: Okay.
24 MR. LUNA: Today's opioid problem is tomorrow's
25 benzo problem. 67
1 The problem is not so much with the pill itself;
2 it's with prescribing habits. States that have enacted
3 formulary tools have actually been successful in changing
4 the mindset around prescription drugs. Providers begin to
5 look at more beyond their own clinical expertise to support
6 their recommendations for prescriptions, understanding the
7 dangers that could potentially lurk.
8 MR. EICHLER: Also, the formularies that have
9 been adopted in several other States include some
10 short-acting opioids and musculoskeletal agents as drugs
11 that do not require preauth. We have got to make sure that
12 there is never a gap in treatment.
13 There was a citation made earlier that patients
14 are denied access to medications during utilization review.
15 That's all in how the regs are written. And the Department
16 here is very competent at writing strong, good regs that
17 will protect the injured worker.
18 And if those opioids that are on the preauth list
19 that do not require preauth are there, there are those
20 stopgap measures to make sure there is continuity of care
21 and somebody does get access to the medications.
22 MAJORITY CHAIRMAN KAUFFMAN: Thank you. Thank
23 you very much.
24 Representative Donatucci.
25 REPRESENTATIVE DONATUCCI: Thank you, 68
1 Mr. Chairman, and thank you for your testimony today.
2 "The primary goal of a drug formulary in workers'
3 compensation is to keep injured workers safe from negative
4 effects of drugs that are not medically necessary, are
5 over-prescribed, or are not proven to be effective."
6 Shouldn't that be true of all patients? I mean, it's
7 almost unconstitutional to treat one group of patients so
8 much different than another.
9 And let me continue and you can answer all the
10 questions at once, is, you know, Purdue Pharma, when they
11 came out with OxyContin, they branded it as being
12 non-addictive, non-dependent. There was a $600 million
13 fine from the government early on, and nobody did anything
14 about it until now. We have people dying every day.
15 So how do I know that the way Purdue Pharma went
16 about getting databases of who prescribes pain medicine,
17 how they targeted certain doctors, how do I know that other
18 pharmaceuticals aren't going to do the same thing to get on
19 that list, and they are two of my biggest concerns.
20 MR. EICHLER: You are spot on, and if I could
21 address that for you.
22 Why workers' comp being treated differently? In
23 group health, you get what you pay for. Group health, you
24 buy a policy. You have defined benefits. There are
25 specific drugs that are covered and not covered. If it's 69
1 not on the list, you're not getting it unless you're paying
2 out of pocket.
3 In workers' comp, that's not the case. An
4 injured worker is entitled to any treatment or any
5 medication that can be medically substantiated. Hence, in
6 workers' comp, there's a carve-out there where you need
7 these extra layers of protection to empower getting the
8 right drugs and to have that pause to review the drugs that
9 are questionable to make sure they are substantiated. We
10 have got uninformed medical consumers in the workers' comp
11 community, and this becomes a protection for them.
12 As far as claims being made by Big Pharma, we're
13 all subject to that. This bill is not meant to control
14 those claims, but it does give, again, that stopgap to get
15 a chance to look at them and protect the injured worker.
16 MR. LUNA: I'll add on to that.
17 Workers' compensation, keep in mind, is a
18 dollar-one benefit, meaning that benefits are paid
19 beginning with the first dollar spent.
20 Workers' compensation is particularly susceptible
21 to these types of abuses because of that reason. There are
22 studies that have been done that actually document
23 providers admitting that they are shifting costs from
24 public programs to workers' compensation because of that
25 reason. 70
1 Touching on your point regarding your concern
2 about the marketing of drugs getting onto lists. I think
3 it speaks to the importance of having a high quality,
4 evidence-based formulary. The evidence-based process by
5 nature will weed out any bias, any studies that aren't of
6 high quality that are developed by marketing firms that
7 have intentions on skewing perspective.
8 Evidence-based medicine also requires external
9 review, meaning that nationally recognized associations,
10 like the American Medical Association, potentially the
11 Pennsylvania Orthopaedic Association, could be called upon
12 to review specific recommendations for drugs for
13 formularies. These steps ensure that the drugs that
14 actually make it on to an evidence-based formulary are
15 actually effective, that they actually do what they are
16 intended to do.
17 Additionally, an added layer of protection for
18 the State -- and many States have done this; particularly
19 in California, they've done it well -- is to create what is
20 called a P&T Committee, a Pharmaceutical and Therapy
21 Committee, where they include local providers, pharmacists,
22 and health-care specialists to participate in this
23 committee to ensure that the formulary that is adopted by
24 the State, although being nationally recognized, is
25 actually right for the State of Pennsylvania and its 71
1 people.
2 So there are a couple of layers of protection
3 there to prevent those types of issues from coming up.
4 MAJORITY CHAIRMAN KAUFFMAN: Thank you.
5 And lastly, we're going to go to Representative
6 Krueger-Braneky, please.
7 REPRESENTATIVE KRUEGER-BRANEKY: Thank you,
8 Mr. Chairman, and thank you, gentlemen, for joining us
9 today.
10 I've got a couple of brief questions, and I
11 appreciate, Mr. Chairman, that you're keeping us on time
12 today.
13 So my first question is for Mr. Turner-Phifer.
14 So you represent an accreditation organization,
15 correct?
16 MR. TURNER-PHIFER: Yes.
17 REPRESENTATIVE KRUEGER-BRANEKY: What is
18 typically the cost of accreditation?
19 MR. TURNER-PHIFER: So the cost varies. We've
20 got 27 different programs, so the cost is structured based
21 on that program's market, what the market can bear, and
22 then our overhead over 3 years.
23 So the accreditation is good for 3 years. An
24 applicant would pay a one-time fee. For utilization
25 management, that fee is just under $37,000. 72
1 REPRESENTATIVE KRUEGER-BRANEKY: Okay. So the
2 fee is $37,000 for them to become accredited.
3 And I see in your testimony you currently
4 accredit 65 organizations in Pennsylvania. Fifteen are
5 under utilization review. So total cost of accreditation
6 would be 37,000 times those 15 providers in Pennsylvania?
7 MR. TURNER-PHIFER: So an organization would pay
8 -- an organization would pay once. So if you've got
9 20 UROs, it would be 20 times 37,000. A URO pays
10 themselves, if that answers your question.
11 REPRESENTATIVE KRUEGER-BRANEKY: Okay. So
12 20 times $37,000.
13 MR. TURNER-PHIFER: I just don't know the stats
14 on the number of utilization review organizations in
15 Pennsylvania.
16 REPRESENTATIVE KRUEGER-BRANEKY: Okay.
17 And then my second question, so for the other two
18 panelists, my understanding is that you represent the only
19 two formularies who would actually be qualified to be
20 selected by the Department of Labor if this bill was to
21 pass? Is that correct?
22 MR. EICHLER: It depends how you look at the
23 definition. Generally when you're looking at the
24 nationally recognized, commercially produced, we' re the two
25 that are at the table. 73
1 REPRESENTATIVE KRUEGER-BRANEKY: Okay.
2 MR. LUNA: I can add to that.
3 The State of California also considered the State
4 of Washington's drug formulary as well, so we are not the
5 only two at the table for discussion.
6 REPRESENTATIVE KRUEGER-BRANEKY: So possibly the
7 only two at the table, possibly not.
8 MR. EICHLER: Yeah. The reason I say that, it's
9 nationally recognized. What is the definition?
10 REPRESENTATIVE KRUEGER-BRANEKY: Sure.
11 MR. EICHLER: Is it one State? Is it two States?
12 The State of Washington is monopolistic.
13 Everyone looks at it, because monopolistic, they can do
14 certain things other jurisdictions can't.
15 REPRESENTATIVE KRUEGER-BRANEKY: Sure.
16 MR. EICHLER: So folks look at it. Does that
17 mean it's nationally recognized? Well, if we all look at
18 it and recognize it as working---
19 MAJORITY CHAIRMAN KAUFFMAN: Okay. Thank you.
20 We need to move along.
21 REPRESENTATIVE KRUEGER-BRANEKY: A follow-up
22 question, Mr. Chairman, please.
23 MAJORITY CHAIRMAN KAUFFMAN: No; no. We're
24 actually going to move along. You can have a sidebar with
25 him afterwards. 74
1 REPRESENTATIVE KRUEGER-BRANEKY: Okay. I'm
2 curious of the cost of what they're proposing---
3 MAJORITY CHAIRMAN KAUFFMAN: I'm going to move
4 on-- Excuse me. We're going to move on to Representative
5 Mackenzie to offer closing remarks.
6 REPRESENTATIVE MACKENZIE: Thank you,
7 Mr. Chairman.
8 I appreciate us staying on schedule. I know
9 everyone has busy schedules today.
10 So I do want to conclude just very quickly in
11 saying that I appreciate the discussion that we have had
12 today. We had a hearing on House Bill 1800 last session.
13 We have received lots of significant and very positive
14 input from the different stakeholders, many of whom are
15 represented here today.
16 We also heard from others who were opposed, and
17 when we heard that opposition, we looked at how we could
18 make this legislation better and actually effect the impact
19 that we want. And so specifically a turning point in this
20 legislative process was a hearing on, the Policy Committee
21 held a hearing on opioids down in Philadelphia at
22 Temple University, and there was discussion about other
23 treatment guidelines which are already going into effect
24 here in Pennsylvania for other types of medical
25 treatments. 75
1 And during that discussion, myself and
2 Representative Gergely, who is not here today, expressed,
3 both expressed a willingness in working on a drug formulary
4 guideline for workers' compensation. He expressed an
5 interest in working on that with me. And since then, I've
6 heard from lots of other Members, bipartisan Members, who
7 think that opioids are a problem here in Pennsylvania.
8 I heard some who want to diminish that fact, who
9 want to take no action on that fact. And unfortunately,
10 this continues to be a significant problem in Pennsylvania.
11 And in workers' comp specifically, we have the third
12 highest amount of opioids prescribed per injured worker out
13 of 25 States studied by the Workers Comp Research
14 Institute. We have the second highest number of opioid
15 pills per prescription per claim. And morphine equivalents
16 per injured worker averaged 78 percent higher than the
17 median State studied.
18 If we are going to undertake a drug formulary
19 for opioids to reduce this problem, that should be
20 sufficient to work for other drugs as well. And we know,
21 even though we have good data on opioids, we know that
22 over-prescription and addiction is a problem with all
23 medications.
24 So thank you again, Mr. Chairman. I want to
25 really express my gratitude for holding this hearing. And 76
1 again, I want to stress to everybody that I do have an
2 open-door policy. Ever since House Bill 1800 last session,
3 we have met with many stakeholders, both in support and
4 against, to come up with House Bill 18 to directly impact,
5 and in a positive way, over-prescribing and addiction in
6 workers' comp.
7 Chairman Galloway, I want to extend that offer to
8 you as well. You did not take me up on that since last
9 session to discuss this topic, but I want to extend that to
10 you again as well, that I am open and always willing to
11 discuss.
12 Thank you.
13 MAJORITY CHAIRMAN KAUFFMAN. Thank you very much.
14 I appreciate the panelists being here, everyone
15 who participated. And I do want to encourage all Members
16 and stakeholders to reach out to my office or
17 Representative Mackenzie's office to improve upon
18 legislation. You know, when you -- yes. There is one
19 correction.
20 I know one of the panelists indicated they
21 thought the Orthopaedic Society was opposed to the
22 legislation, and the Orthopaedic Society informed us they
23 are not opposed to the legislation. They have some
24 constructive criticism and some help to make the
25 legislation better, but they are not opposed to this. And 77
1 that's the kind of conversation we want to have to make
2 this the best legislation possible and, you know, to move
3 forward with the process.
4 So thank you all very much. And if the panelists
5 are here, if there is further conversation to be had, I
6 don't think they're going to rush off to Colorado and
7 Florida and DC. So thank you all very much.
8 We will reconvene at 1 o'clock for the next
9 informational meeting.
0
1 (At 12:01 p.m., the public hearing adjourned.) 78
1 I hereby certify that the foregoing proceedings
2 are a true and accurate transcription produced from audio
3 on the said proceedings and that this is a correct
4 transcript of the same.
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7 ~y>kA^LXjLy-
8 Debra B: Miller
9 Transcriptionist
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24 DBM Reporting