CAMBRIDGE, MA – The cost per claim of prescription drugs used to treat injured workers in New Jersey was nearly 20 percent lower than in most study states, according to a new study by the Workers Compensation Research Institute (WCRI).
The 16-state study by the Cambridge, MA-based WCRI found that the average payment per claim for prescription drugs in New Jersey’s workers’ compensation system was $332—19 percent lower than the median of the study states.
The main reason for the lower prescription costs in New Jersey was the lower utilization of prescription drugs, although this was partly offset by higher average prices paid for some common pharmaceuticals.
The WCRI study, Prescription Benchmarks for New Jersey, found that the utilization of prescription drugs was the lowest among the study states, with the average number of pills per claim 27 percent lower than the 16-state median. This was true mainly because New Jersey physicians wrote fewer prescriptions per claim.
The study pointed out, however, that the average price per pill paid to New Jersey pharmacies was higher than the median of the 16 states for three reasons.
First, New Jersey physicians prescribed more expensive brand name drugs for 20 percent of all prescriptions, compared to 15 percent in the median state studied.
In addition, prices per pill paid to pharmacies were 15 to 20 percent higher in New Jersey than in the median state for several common drugs. For example, the price paid for the painkiller Oxycodone with Acetaminophen was 18 percent higher than the 16-state median.
Finally, some physicians in New Jersey wrote prescriptions and dispensed the medications in their offices directly to the patient. When physicians dispensed prescription drugs, they were paid more than what pharmacies would have been paid if the same prescription were filled at a pharmacy.
The WCRI study is the first in an annual series that benchmarks the cost, price and utilization of pharmaceuticals in workers’ compensation.
The Workers Compensation Research Institute is a nonpartisan, not-for-profit membership organization conducting public policy research on workers’ compensation, healthcare, and disability issues. Its members include employers, insurers, insurance regulators, and state administrative agencies in the U.S., Canada, Australia, and New Zealand as well as several state labor organizations.