News Item Detail
Florida weighs work comp hike and cost of doctor dispensed medications
In January 2012, Florida employers could be paying up to 8.9% more for their workers' compensation premiums. The rate changes may also trigger legislative action to clamp down on doctor-dispensed drugs.
The National Council on Compensation Insurance recommended a rate hike for the 2012 year. This rate increase will follow a 7.8% increase in 2011. However, even with the proposed increase, the state's workers' compensation rates have fallen a total of 58.6% since 2003. According to the NCCI, no one expected the 2003 reforms would have had such a positive and continued effect on the system.
Since the 2003 reforms, the rates declined steadily and then leveled off around 2006. The slight increases in premiums for the last two years are only slightly higher. It is obvious that the current economic downturn has also had its effect on the rates. Since the housing bubble burst, the construction industry alone has seen its work force drop by 42%. Due to the declining payrolls, there have been significantly decreased premiums.
Additionally, the legislature will review rules and regulations regarding physician-dispensed drugs. Presently, Florida's workers' compensation law specifies that pharmacies are to be reimbursed at a drug's average wholesale price plus $4.18. However, there is no regulation when it comes to doctors to sell and repackage drugs in their office. This has resulted in an explosion of physician-dispensed drugs with markups as high as 600%.
According to the NCCI, in 2003, only nine percent of drugs were dispensed by physicians. That number is now over 50%. This is having a direct impact on the workers' compensation rates. It is also having a direct impact on the health of workers' compensation patients since they are potentially receiving more drugs than they need for a longer period of time when using repackage physician-dispensed medications.
For more information on the proposed workers' compensation changes, please visit: http://www.insurancejournal.com/news/southeast/2011/10/13/219870.htm
The National Council on Compensation Insurance recommended a rate hike for the 2012 year. This rate increase will follow a 7.8% increase in 2011. However, even with the proposed increase, the state's workers' compensation rates have fallen a total of 58.6% since 2003. According to the NCCI, no one expected the 2003 reforms would have had such a positive and continued effect on the system.
Since the 2003 reforms, the rates declined steadily and then leveled off around 2006. The slight increases in premiums for the last two years are only slightly higher. It is obvious that the current economic downturn has also had its effect on the rates. Since the housing bubble burst, the construction industry alone has seen its work force drop by 42%. Due to the declining payrolls, there have been significantly decreased premiums.
Additionally, the legislature will review rules and regulations regarding physician-dispensed drugs. Presently, Florida's workers' compensation law specifies that pharmacies are to be reimbursed at a drug's average wholesale price plus $4.18. However, there is no regulation when it comes to doctors to sell and repackage drugs in their office. This has resulted in an explosion of physician-dispensed drugs with markups as high as 600%.
According to the NCCI, in 2003, only nine percent of drugs were dispensed by physicians. That number is now over 50%. This is having a direct impact on the workers' compensation rates. It is also having a direct impact on the health of workers' compensation patients since they are potentially receiving more drugs than they need for a longer period of time when using repackage physician-dispensed medications.
For more information on the proposed workers' compensation changes, please visit: http://www.insurancejournal.com/news/southeast/2011/10/13/219870.htm
November 22, 2011, 12:00 am
