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Hospitals Jump Into the Fray – New Lawsuits Against Opioid Manufacturers

By: Andrew Silverio, Esq.

In August, a $572 million Oklahoma ruling came down against Johnson & Johnson – the first major ruling against a drug manufacturer for its role in America’s ongoing opioid crisis.  The holding found that the drug manufacturer’s advertising and marketing helped flood the state with dangerous painkillers, and it dominated the news cycle as the first major “loss” for a drug manufacturer in a case of this type (many similar claims have been settled out of court.  It also sparked a firestorm of speculation about who will come out of the woodwork making such claims against various manufacturers, since the harm associated with the opioid crisis is so far-reaching.

Now, an unexpected plaintiff has jumped into the fight to claim their share of the payout – hospitals. Per Blake Farmer at NPR, “hundreds of hospitals have joined up in a handful of lawsuits in state courts, seeing the state-based suits as their best hope for winning meaningful settlement money” (see https://www.npr.org/sections/health-shots/2019/10/24/771371040/some-hospitals-sue-opioid-makers-for-costs-of-treating-uninsured-for-addiction.)  If this causes you to raise an eyebrow, you aren’t alone – many would argue, and this will almost certainly be raised as a defense, that hospitals are in fact complicit in creating this crisis through overprescribing of these drugs.

The hospitals’ main claim will be that they have been damaged in the form of all the uncompensated care they have had to provide resulting from the opioid crisis, emergency and otherwise, with most of this care being uncompensated as the patients are often uninsured and unable to pay for treatment.  This is certainly a legitimate complaint, however many hospitals have been unwilling to join in.  This is likely at least in part motivated by a desire to keep details private about the hospitals’ own prescribing practices (which will likely be scrutinized by the defense), as well as to avoid being required to justify their charges as they relate to the actual costs of care.

We will undoubtedly continue seeing new lawsuits in this area for years, but these will be important cases to keep an eye on. 


The Opioid Crisis: How Employers & Self-Funded Health Plans Can Combat This Epidemic

By: Philip Qualo, J.D.

Each year more and more Americans overdose on prescription opioid drugs. In fact, the Centers for Disease Control and Prevention (CDC) reported that deaths attributed to opioid abuse and addiction now exceed car crashes as the leading cause of unintentional death in the United States. Opioid addiction has grown exponentially in recent years and is now officially the deadliest drug crisis in American history, more than heroin and cocaine combined.

Opioid drugs are routinely prescribed by healthcare providers for its lawful intended purpose, to treat severe pain. As access to healthcare has increasingly become available to all Americans from diverse backgrounds, this specific drug crisis is unique in that it crosses all social, economic and racial boundaries. This broad demographic substantially increases the likelihood that the opioid epidemic will eventually make its way into every employer’s workforce.

Employers sponsoring group health plans can incur significant financial and legal risks when dealing with plan participant opioid abuse, such as an increased use of emergency room services, hospitalizations, related medical costs, and even an increase in workers’ compensation claims. As a result of opioid abuse, the cost per claim continues to grow, as well as the number of painkillers per claim. For example, a 2012 study conducted by The Hopkins-Accident Research Fund Study, found that workers prescribed even one opioid had average total claim costs that were more than three times greater than claimants with similar claims but who were not prescribed any opioids. 

Employers who sponsor self-funded health coverage have a particular advantage in combatting the opioid epidemic in their own workforce as they have the flexibility to design their health plans in ways that could potentially discourage opioid abuse among plan participants. For example, allowing for low cost access to, or otherwise incentivizing participation in, popular alternatives to pain management. These alternatives provide plan participants with a variety of options to treat pain without the use of prescription drugs. The most common alternatives to pain management are acupuncture, chiropractic care and physical therapy. Such alternatives are likely far less expensive than the financial and legal risks associated with prescription opioid abuse.

Self-funded health plans also have the ability to ensure that healthcare providers in their networks are following CDC guidelines. These guidelines are intended to improve the way opioids are prescribed to ensure patients have access to safer, more effective chronic pain treatment while reducing the number of people who misuse, abuse, or overdose from these drugs. In the alternative, self-funded health plans could consider implementing a three-day limit on opioid prescriptions for initial pain treatment as the CDC has found that the probability of addiction increases on day four.  

Regardless of how employers and/or plan sponsors choose to address the opioid epidemic, it is important that employees and plan participants are educated about opioid abuse and its potential consequences.  Employees that are educated about the drug crisis and their healthcare options are more likely to make informed decisions regarding their pain.