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On the surface, there isn't anything too ominous about that trend. But, according to Tron Emptage, a pharmacist and chief clinical and compliance officer at Progressive Medical, the Westerville, Ohio-based workers' compensation Pharmacy Benefits Manager (PBM), limited clinical evidence of their effectiveness and how medical foods are regulated, along with ineffective measures to control dispensing, make managing the cost of medical foods an emerging challenge for workers' compensation payors.

"As medical foods continue to increase in utilization in workers' compensation, payors need to understand their impact and develop policies for reimbursement and utilization," Emptage says. "Because medical foods are relatively new and difficult to gauge as they move through the billing process, they can present an especially tricky challenge."

Today, Beth Kuschner, PharmD and clinical pharmacist at Progressive Medical, notes, medical foods are increasingly prescribed by doctors to treat chronic diseases, neurological disorders and other conditions. For example, medical foods are used to manage depression, sleep disorders, acute or inflammatory pain and joint disorders. Some have been shown to reduce hospital stays, incidence of complications and mortality in the critically ill. Additionally, there is also evidence that indicates that medical foods may reduce dosage requirements of maintenance medications.

In addition, medical foods can also be dispensed along with a generic prescription medication in the form of a convenience pack (also called a co-pack). For example, Theraproxen (Trepoxen) is a co-pack in which Theramine, a medical food to help restore low levels of brain chemicals such as serotonin or gamma-aminobutyric acid (GABA) to reduce sensitivity to pain, is dispensed with naproxen, an anti-inflammatory and pain reducing medication, Kuschner explains. The purpose of the co-packaging is to replenish nutritional deficiencies, offset digestive or other side effects, enable absorption and potentially reduce dosage of the prescribed medication. Similar to medical foods, physicians can dispense co-packs at their offices.

Because medical foods are not FDA-approved, they do not have to be submitted for pre-market FDA review or approval. While they do have to undergo scientific testing, clinical trials are not required. Additionally, individual medical food products do not have to be registered with the FDA but their ingredients do have to be generally recognized as safe (GRAS).

"Medical food regulation has been fairly static since 1988," says Kuschner. "But recently, the FDA has issued several warning letters targeting the labeling and usage of testimonials."

For example, one FDA letter concluded that a medical food did not meet the official definition because it was intended for an audience who could fulfill the nutrient requirements by modifying their diet, making the product unnecessary. Another FDA letter concluded that the labeling on a medical food failed to bear adequate directions for the safe, intended use of the products.

Medical foods in workers' compensation are on the rise. For example, the California Workers Compensation Institute (CWCI) , in a report called "The Cost and Utilization of Compound Drugs, Convenience Packs and Medical Foods in California Workers' Compensation," documented the rise in spend on medical foods, repackaged drugs, and compound drugs from 2006-2009. The CWCI found that those three categories accounted for almost 12 percent of drug spend in California in the first quarter of 2009, with medical food reimbursement at $233 per prescription in that quarter.

Interestingly, until recently, medical foods were not commonly prescribed in workers' compensation cases. Today, they are being prescribed to treat cases involving chronic, neuropathic or inflammatory pain, sleep disorders, depression or conditions such as osteoarthritis.

This rise in medical foods is foreign to many claims professionals and case managers, so understanding their impact and developing policies for coverage and reimbursement becomes even more important for the payors.

"Medical foods are often difficult to recognize on invoices or medication payment requests as not all of these types of therapies are billed via standard codes, the same as prescription medications." says Kuschner. If these types of charges appear, it's critical for claims professionals to carefully review those bills and send them to their PBM for adjudication.

As medical foods (and co-packs) increase in utilization, there are several steps payors and their PBMS should take to ensure they are managed effectively:

-- Define the role of medical foods within their internal policies and procedures

-- Establish clear payment policies and processes as allowed within the jurisdictions they serve

-- Provide claims professional education on medical foods

-- Leverage prospective and concurrent utilization review programs to make appropriate payment decisions on reasonable and necessary therapy.

"Payors working with a PBM should ensure they have a process in place that is managed by clinical pharmacists," Emptage says. "The clinical utilization review program should use a combination of evidence-based guidelines, peer review journals and recommendations provided by government organizations. Both prospective and concurrent review processes are essential to a successful program for monitoring medical food use."

In addition, physician monitoring and clinical intervention programs can also be used to meet evaluation needs. According to Emptage, the range of programs should consist of registered pharmacists, nurses and other health professionals available for consultation on medication/medical food questions to more detailed evaluations, including peer reviews and direct consultation with prescribing physicians.

"The clinical intervention team should provide recommendations for specific claims that require further evaluation through the use of the information gathered in prospective, concurrent, and retrospective review processes," he says.

Use of the PBM processes can assist in managing medications including medical foods. Even though medical foods are relatively new to the workers' compensation arena, there are indications that usage will continue to rise.

"These factors make it critical for workers' compensation payors to take action now to put strategies for managing medical foods in place," Emptage says. "By doing so, it will ultimately ensure injured worker safety and help reduce total cost of the claim."

For more information, call Progressive Medical toll-free number at 866.742.7676, or visit us at www.progressive-medical.com.

(The above piece is part of our continuing Insights series designed to highlight key products and services to our readers. This paid-for Insights was written and edited by Risk & Insurance® on behalf of our marketing partner. Additional Insights can be found on our Web site at www.riskandinsurance.com/.)

March 9, 2011

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