Workers’ comp prescription drug reform takes first step in Senate

A reform of workers’ compensation prescription drug benefits being aggressively lobbied by just about every business group in the state passed the Senate Banking and Insurance Committee on Thursday morning. But not before some heated rhetoric and testy back-and-forths that call into question the bill’s future.

Lambasting doctors that upcharge insurers as much as 600 percent for drugs after they unbundle and repackage them, Sen. Alan Hays, R-Umatilla, introduced SB 668 to cap drug dispensers’ markup at $4.18.

“When I learned about the facts of this situation, I said ‘There ought to be a law against that,’” said Hays. “This bill will stop [doctors] from ripping off the system by charging extremely inflated fees for medication.”

The bill seeks to close the so-called drug repackaging loophole, which allows physicians to charge increased reimbursement rates for medication bought wholesale, repackaged for patients and then given a heftier price tag. Those markups costs employers as much as $62 million annually, and are a major contributor to this year’s 8.9 percent increase in workers’ compensation premiums, according to industry estimates.

Hays was blunt and terse in his response: “I really have no idea the origin or the purpose of the question.”

Dr. Gary Kellman, one of two doctors to speak out against the bill at the hearing, said his office in Plantation could not continue to dispense drugs to patients if the price was capped, due to the costs involved.

“This very idea that doctors are gouging the system is unbelievably offensive to me,” he said, adding that insurers let their workers’ compensation patients get drugs directly from doctors (rather than from a pharmacy) because those workers get better faster.

More than a dozen business groups have expressed support for closing the loophole.

Back in 2010, the bill passed both houses, but was vetoed by Gov. Charlie Crist. The bill moves next to the Health Regulation Committee in the Senate. Its companion in the House, HB 511 (which has some 22 co-sponsors), cleared its first committee last month, and is on its way to a vote in the Health and Human Service Committee.