CMS and Opioid Medications - Will CMS Address Opioids in 2018?

By Sidney Wong December 19, 2017

Ever since Center for Medicare & Medicaid Services (CMS) started to individually price medications in early 2009, prescription medications, especially opioid medications, have become major cost drivers in Workers’ Compensation Medicare Set Aside Arrangements (WCMSA). Beyond just increasing the average amount of a WCMSA, the methodology CMS applies to medications does not take into consideration future changes in treatment, or the long term effect of using opioid medications.

Currently, CMS takes a strict formulaic approach that will price all Medicare covered medication related to a claim at the present dosage and frequency for the “duration of a claimant’s life expectancy” and regardless of whether or not the claimant is a Medicare beneficiary or has Medicare Part D coverage.   Unless steps are taken to control or reduce the claimant’s prescriptions as part of the underlying claim, CMS’ simplistic approach often leads to high (and unrealistic) WCMSA allocations. 

With the country’s focus on controlling and curing the opioid epidemic, will CMS eventually adjust its method for calculating opioid medications in relation to WCMSAs?

In a potentially positive development, a new posting by CMS indicates that it is at least recognizing the issue. CMS states the following in its new post:

CMS understands the concerns regarding the opioid crisis occurring in the United States. We are committed to ensuring the determination of Workers’ Compensation Medicare Set Aside Arrangement (WCMSA) amounts are an adequate projection of claimant’s needs for future medical services and prescription drugs. CMS continually evaluates all policies and procedures related to WCMSA amounts. Any changes that Medicare pursues related to this issue will be reflected in our WCMSA amount review process.

It remains to be seen whether this new posting indicates that CMS is ready to take a different approach with Opioids in 2018 relative to WCMSAs – but it is matter definitely worth following in the New Year. ISO CP will be monitoring this very closely and will provide updates as warranted. In the meantime, CMS’ posting can be obtained here.

Please contact the author if you have any questions at Sidney.wong@verisk.com or 978.825.8262.


Sidney Wong

Sidney Wong is the assistant vice president of policy at ISO Claims Partners, where he provides the highest level of client services—with a focus on meeting the needs of clients through ISO’s products and services. He is also responsible for assisting clients with effectively navigating Medicare compliance issues.