Coalition urges Legislature to close loophole in workers’ comp system

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The Workers’ Compensation Coalition, on behalf of its more than 60 members, today urges members of the House Health Quality Subcommittee and the Senate Banking and Insurance Committee to support House Bill 605, sponsored by Representative Matt Hudson, and Senate Bill 662, sponsored by Senator Alan Hays, to maintain the necessary balance for Florida’s workers’ compensation system to continue to see improvement and lower rates. 

The proposed legislation focuses on closing a loophole in Florida’s workers’ compensation system that currently allows physicians to dispense repackaged drugs and charge employers exorbitant prices that greatly exceed the statutory reimbursement for the same pharmaceuticals dispensed by pharmacies. 

“Addressing the drug repackaging loophole in today’s workers’ compensation system is one of our coalition’s priorities this session,” said Tom Feeney, president and CEO of Associated Industries of Florida (AIF). “This is a longstanding issue that we have unanimously and vehemently supported in years past. Florida’s workers’ compensation system has taken strides in its effort to reduce fraud and frivolous litigation. This proposal is critical to ensure that workers’ compensation coverage is available and affordable to all Florida businesses and employees.” 

Florida law expressly provides that the intent of the workers’ compensation system is to “assure the quick and efficient delivery of disability and medical benefits to an injured worker and to facilitate the worker’s return to gainful reemployment at a reasonable cost to the employer.” Unfortunately, with the loophole still in place, this intention is being undermined and ignored by physicians who dispense repackaged drugs that exponentially exceed the statutory reimbursement for pharmaceuticals. 

In January 2013, the Office of Insurance Regulation (OIR) published its “2012 Workers’ Compensation Annual Report,” stating that workers’ compensation premiums have cumulatively decreased by 56 percent since the legislature enacted reforms to the system in 2003. However, the OIR cautioned Florida businesses to not ignore the rate impact of medical cost drivers associated with physician drug repackaging, among others. 

“This is an unfair practice that is holding employers responsible for markups that are, in the end, hiking up their workers’ compensation premiums for no good reason,” said Tamela Perdue, general counsel for AIF. “It’s important to clarify that nothing in these proposals limits patient choice on where they want to receive their medications. These proposals actually clarify that the maximum cost to be charged for a particular medication will be the same across the board, no matter where the patient chooses to purchase it.” 

“The workers’ compensation coalition urges the Florida Legislature to take point on addressing this loophole this year, so that we may continue to reduce the cost of doing business in Florida,” said Feeney.

Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including SaintPetersBlog.com, FloridaPolitics.com, ContextFlorida.com, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.