Bluegrass State Leads the Opioid Fight
Central Appalachia earned a distinction as the epicenter of the nation’s opioid-addiction epidemic for a number of reasons. Two key factors are the complex injuries suffered by coal miners and the physical demands placed on workers toiling in other hazardous industries in that region such as logging and trucking.
Others include the region’s economic misfortunes, lax prescribing practices, access to pill mills, and pharmaceutical company marketing. All led to an ongoing drug-abuse scourge that surfaced there in the 1990s, studies and observers report.
“Central Appalachia, which for us is eastern Kentucky, was one of the first areas to see the opioid epidemic explode in the 1990s,” said former Bluegrass State attorney general Jack Conway. “Because in Appalachia you had mining, you had a lot of heavy industry, trucking, and more workplace injuries on average than you would in other parts of the state. You saw an increase in the prescribing and utilization of opioids and it created an addiction epidemic.”
“I think we have more tools in the states that have been battling this [opioid epidemic] for some time. That has made us stronger in the ability to control it.” — Cindy Whitehouse, CEO and founder, Ascential Care
Now, as the rest of the nation experiences opioid abuse patterns seen early on across Central Appalachia, Kentucky provides examples for battling back against the epidemic.
In 2012, Kentucky became the first state among jurisdictions adopting stricter prescription-drug monitoring programs (PDMPs) with objective criteria mandating when prescribers must register and review a state database of patient prescription histories, Brandeis University’s PDMP Center of Excellence reports.
State PDMPs seek to change provider prescribing practices and prevent patients from doctor-shopping to obtain multiple prescriptions.
Kentucky’s latest PDMP was born from a 2012 comprehensive law adopted to combat opioid abuse.
“Kentucky has a great [PDMP] system,” said Tom Clark, research associate for the Brandeis Center of Excellence. “It is very well supported by the state. Of course, this is all a response to Kentucky being in the epicenter of the prescription drug abuse epidemic and it has been for a long time.”
While all states except Missouri have PDMP laws, participation in many states remains voluntary, said Brian Allen, VP of government affairs for Optum workers’ comp and auto no-fault. In the last three years or so, however, more jurisdictions are making their use mandatory.
“There has been a lot more renewed emphasis on [PDMPs] because everybody has been trying to get their heads around this opioid problem,” he said.
A May 2016 Center of Excellence report with data from Kentucky and the other states indicates that increased PDMP use immediately impacts controlled substance prescribing and doctor-shopping.
Yet only a few states have laws as strict as Kentucky’s, requiring all prescribers to register and check their PDMPs when initially prescribing opioids and benzodiazepines, and again every three months when continuing the prescriptions, the PDMP Center of Excellence reports.
Meanwhile, reports linking Central Appalachia’s work injuries to drug abuse have persisted for years.
A 2002 combined U.S. Justice Department and Kentucky State Police assessment described a growing threat from prescription painkillers. The threat was so specific to Appalachia that opioids and opiates became known disrespectfully as “hillbilly heroin.”
“In the eastern coal mining counties of Kentucky, the large-scale diversion and abuse of painkillers are particular problems,” the report warned. “In the past, coal miners spent hours each day crouched in narrow mine shafts. Painkillers were dispensed by coal mine camp doctors in an attempt to keep the miners working. Self-medicating became a way of life for miners, and this practice often led to abuse and addiction among individuals who would have been disinclined to abuse traditional illicit drugs.”
Michelle Landers, VP and general counsel for Kentucky Employers Mutual Insurance, agreed that eastern Kentucky’s historical dependence on coal mines, and related service industries like trucking, helped link workplace injuries and chronic pain with opioid use.
KEMI, which issues policies to coal mines, is the Bluegrass State’s largest workers’ comp insurer.
Coal operations provide one of eastern Kentucky’s few employment opportunities.
Mining also produces severe workplace injuries, caused by accidents such as cave-ins or heavy machinery malfunctions, Landers said.
“We have, from early on, taken the approach that if we don’t feel it’s appropriate and we don’t get cooperation from the physician, we are going to challenge it.” — Michelle Landers, VP and general counsel, Kentucky Employers Mutual Insurance
“It’s not an industry where you are going to have small injuries,” she elaborated.
“They are typically severe or the chronic type of injuries you expect from people being underground.”
Kentucky’s private-industry workers, in general, experience a high injury rate. U.S. Department of Labor statistics for 2014 ranked Kentucky among 19 states with a recordable injury rate significantly higher than the national average.
Centers for Disease Control and Prevention data for the same year, meanwhile, shows Kentucky among five states with the nation’s highest rate of overdose deaths.
KEMI first discovered a frequent use of the narcotic OxyContin to treat work injuries after contracting with a pharmacy benefit manager in 2001, Landers said. The PBM data revealed questionable practices, such as doctors prescribing high doses of the drugs early in the course of treatment for back strains.
“We were seeing things out there about the high levels of addiction and [overdose] deaths and we didn’t want to contribute to that,” Landers said.
So KEMI became an early adopter of measures like educating adjusters and nurse case managers about the dangers of opioids and teaching them to recognize red flags, such as doctors prescribing the drugs for longer periods than typically appropriate.
KEMI also used PBM data to identify frequently prescribing doctors.
“If you were treating with one of those [doctors] that might be a red flag,” Landers said.
KEMI’s concerted efforts included using its attorneys to engage in medical-fee disputes challenging claims before administrative judges when inappropriate prescribing occurred.
“We have, from early on, taken the approach that if we don’t feel it’s appropriate and we don’t get cooperation from the physician, we are going to challenge it,” Landers said.
Landers will speak at the 25th Annual National Workers’ Compensation and Disability Conference® & Expo on Dec. 1, during a presentation titled “Lessons Learned From Fighting Drug Abuse in the Opioid-Crisis Epicenter.”
The 2012 Kentucky law has limited prescription abuse. In addition to requiring prescribers to report to the state PDMP, it also regulated pain clinics.
A 2015 study prepared by the Institute of Pharmaceutical Outcomes and Policy at the University of Kentucky reported that since the law’s passage, prescribers registering with the PDMP increased by 262 percent, while annual prescriber queries into the PDMP rose 650 percent.
Prescriptions for controlled drugs decreased 4 percent to 8 percent during the same period.
Appalachia still has issues, but the situation is improving.
“I think we have more tools in the states that have been battling this [opioid epidemic] for some time,” said Cindy Whitehouse, CEO and founder of Ascential Care, a Lexington, Ky.-based managed care company. &
In Support of Monitoring
State prescription drug monitoring programs can help prevent the ruin of families, overdose deaths and other steep costs society pays for the nation’s opioid drug abuse epidemic.
In narrower workers’ compensation terms, the databases can stop injured workers and other patients from slipping into addiction and the illegal activity that drives claims costs. PDMPs track prescriptions and alert prescribers and pharmacists when claimants doctor-shop to obtain multiple pharmacy fills, either to use the drugs themselves or sell them.
The information can help stop such activity and detect when a patient might need an intervention.
The benefits of PDMP laws make it absurd that Missouri remains the nation’s only state without one, after a legislative bid to adopt a law failed again there this year.
Conservative organizations opposed the bill, arguing that it represented an unnecessary invasion of privacy.
Recent studies also show that PDMPs do reduce doctor-shopping and help change prescriber behavior so that fewer inappropriate prescriptions are written.
Organizations such as the American Insurance Association, the Missouri Chamber of Commerce and Industry, and the Missouri Hospital Association. backed it. They argued that a PDMP law shields families from drug abuse and improves workplace safety.
Existing PDMP laws vary widely across states. Some call only for voluntary participation. But in contrast to Missouri’s failure to implement a PDMP, more states are responding to the opioid-abuse epidemic by making their existing PDMPs more stringent and including mandates for prescribers.
Three years ago, 13 states had laws mandating prescribers to register with or query their state PDMPs.
By May 2016, about 30 states had mandates, and more are expected to join the trend, according to the Brandeis University PDMP Center of Excellence.
Recent studies also show that PDMPs do reduce doctor-shopping and help change prescriber behavior so that fewer inappropriate prescriptions are written.
Kudos to states adopting strong PDMP laws for helping patients, their families and the rest of society.
Billions of dollars are now spent on the nonmedical use of prescription opioids including crime expenses, the cost of addiction treatment, and lost worker productivity.
Missouri isn’t the only state that can do more to help, though. States also need to adopt multijurisdictional pacts allowing the sharing of PDMP data across borders.
Such pacts can prevent traveling to neighboring states to avoid detection.
That is occurring along the Kentucky-Missouri border. Kentucky has one of the nation’s most stringent PDMP laws. But sources tell me they have seen some workers’ compensation claims from injured workers that crossed into Missouri to get meds.
There are legitimate concerns about implementing stringent PDMPs. If they are inefficient and cumbersome they can excessively tax doctors’ offices, which must commit staff resources to access the databases.
So states need to support their PDMP laws and provide the resources necessary to make their systems easy to navigate.
Claims that a potential invasion of privacy is more important than the opioid problem are overblown.
Solving complicated problems requires multiple tools and PDMPs are a tool proving their worth. &
Handling Heavy Equipment Risk with Expertise
What happens to a construction project when a crane gets damaged?
Everything comes to a halt. Cranes are critical tools on the job site, and such heavy equipment is not quickly or easily replaceable. If one goes out of commission, it imperils the project’s timeline and potentially its budget.
Crane values can range from less than $1 million to more than $10 million. Insuring them is challenging not just because of their value, but because of the risks associated with transporting them to the job site.
“Cranes travel on a flatbed truck, and anything can happen on the road, so the exposure is very broad. This complicates coverage for cranes and other pieces of heavy equipment,” said Rich Clarke, Assistant Vice President, Marine Heavy Equipment, Lexington Insurance, a member of AIG.
On the jobsite, operator error is the most common cause of a loss. While employee training is the best way to minimize the risk, all the training in the world can’t prevent every accident.
“Simple mistakes like forgetting to put the outrigger down or setting the load capacity incorrectly can lead to a lot of damage,” Clarke said.
Crane losses can easily top $1 million in physical damage alone, not including the costs of lost business income.
“Many insurers are not comfortable covering a single piece of equipment valued over $1 million,” Clarke said.
A large and complex risk requires a sophisticated claims approach. Lexington Insurance, backed by the resources and capabilities of AIG, has the underwriting and claims expertise to handle such large claims.
“Cranes travel on a flatbed truck, and anything can happen on the road, so the exposure is very broad. This complicates coverage for cranes and other pieces of heavy equipment. Simple mistakes like forgetting to put the outrigger down or setting the load capacity incorrectly can lead to a lot of damage.”
— Rich Clarke, Assistant Vice President, Marine Heavy Equipment, Lexington Insurance
Flexibility in Underwriting and Claims
Treating insureds as partners in the policy-building and claims process helps to fine-tune coverage to fit the risk and gets all parties on the same page.
Internally, a close relationship between underwriting and claims teams facilitates that partnership and results in a smoother claims process for both insurer and insured.
“Our underwriters and claims examiners work together with the broker and insured to gain a better understanding of their risk and their coverage expectations before we even issue a policy,” said Michelle Sipple, Senior Vice President, Property, Lexington Insurance. “This helps us tailor our policies or claims handling to suit their needs.”
“The shared goals and commonality between underwriting and claims help us provide the most for our clients,” Clarke said.
Establishing familiarity and trust between client, claims, and underwriting helps to ensure that policy wording is clear and reflects the expectations of all parties — and that insureds know who to contact in the event of a loss.
Lexington’s claims and underwriting experts who specialize in heavy equipment will meet with a client before they buy coverage, during a claim, or any time in between. It is important for both claims and underwriting to have face time with insured so that everyone is working toward the same goals.
When there is a loss, designated adjusters stay in contact throughout the life of a claim.
Maintaining consistent communication not only meets a high standard of customer service, but also ensures speed and efficiency when a claim arises.
“We try to educate our clients from the get-go about what we will need from them after a loss, so we can initiate the claim and get the ball rolling right away,” Clarke said. “They are much more comfortable knowing who is helping them when they are trying to recover from a loss, and when it comes to heavy equipment, there’s no time to spare.”
“Our underwriters and claims examiners work together with the broker and insured to gain a better understanding of their risk and their coverage expectations before we even issue a policy. This helps us tailor our policies or claims handling to suit their needs.”
— Michelle Sipple, Senior Vice President, Property, Lexington Insurance
Leveraging Industry Expertise
When a claim occurs, independent adjusters and engineers arrive on the scene as quickly as possible to conduct physical inspections of damaged cranes, bringing years of experience and many industry relationships with them.
Lexington has three claims examiners specializing in cranes and heavy equipment. To accommodate time differences among clients’ sites, Lexington’s inland marine operations work out of two central locations on the East and West Coasts – Atlanta, Georgia and Portland, Oregon.
No matter the time zone, examiners can arrive on site quickly.
“Our clients know they need us out there immediately. They know our expertise,” Clarke said. “Our examiners are known as leaders in the industry.”
When a barge crane sustained damage while dismantling an old bridge in the San Francisco Bay that had been cracked by an earthquake, for example, “I got the call at 6 a.m. and we had experts on site by 12 p.m.,” Clarke said.
In addition to educating insureds about the claims process and maintaining open lines of communication, Lexington further facilitates the process through AIG’s IntelliRisk® services – a suite of online tools to help policyholders understand their losses and track their claim’s progress.
“Brokers and clients can log in and see status of their claim and find information on their losses and reserves,” Sipple said.
In some situations, Lexington can also come to the rescue for clients in the form of advance payments. If a crane gets damaged, an examiner can conduct a quick inspection and provide a rough estimate of what the total value of the claim might be.
Lexington can then issue 50 percent of that estimate to the insured immediately to help them get moving on repairs or find a replacement. This helps to mitigate business interruption losses, as it normally takes a few weeks to determine the full and final value of the claim and disburse payment.
Again, the skill of the examiners in projecting accurate loss costs makes this possible.
“This is done on a case-by-case basis,” Clarke said. “There’s no guarantee, but if the circumstances are right, we will always try to get that advance payment out to our insureds to ease their financial burden.”
For project managers stymied by an out-of-service crane, these services help to bring halted work back up to speed.
For more information about Lexington’s inland marine services, interested brokers should visit http://www.lexingtoninsurance.com/home.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Lexington Insurance. The editorial staff of Risk & Insurance had no role in its preparation.