Time of reckoning for US employers over opioid abuse

Health insurance system is partly to blame for the epidemic that is costing companies $18bn a year

Listen to this article

00:00
00:00

Aged 33, Bill Butler was in excruciating pain from a back injury, the product of more than a decade working in various manufacturing jobs. “He was the type of guy who would always lift more than he should to help other people,” recalls his brother Rex. It was just two weeks until he was due to have surgery, but the painkillers his doctor had prescribed were no longer effective.

After a telephone consultation Bill was given a prescription of methadone pills, which he collected at the pharmacy that night. He took more tablets than he should have — having always found that the recommended doses rarely worked — and settled down to watch television with his wife and children in their farmhouse in eastern Iowa.

The next morning his wife was making breakfast and asked their son to find his father. After searching the house, he found Bill in the attic. He was blue. “He’d had respiratory failure from taking too much methadone and passed away during the night,” recalls Rex, who still misses his brother terribly. “There is a special relationship there — it really impacted me.”

In the years following his brother’s death in July 2006, Rex became alarmed by the large number of newspaper articles about people who had suffered a similar fate. “Almost every day after that a story would pop up about opioid addiction and overdoses, and things like that,” he recalls.

The US is in a opioid addiction crisis that has been described as a national epidemic by health officials. Each day 91 people die after overdosing on the drugs, according to the Centers for Disease Control and Prevention. More Americans now die from drug overdoses than in car accidents or from gun violence put together, and more than 2.6m are addicted to opioids, according to CDC figures.

Rex Butler, whose brother Bill died from a methadone overdose © Kathryn Gamble

Too often, the opioid epidemic is portrayed as a problem for either the poor and vulnerable or the rich and famous — people who live in trailer parks or pop stars like Prince, who died from an accidental opioid overdose last year. But as Bill Butler’s case and those of countless others show, the crisis cuts across all strata of American society, not least middle-class people working in the private sector — the people seen as the foundation on which the country is built.

Although official statistics indicate the percentage of employed people with an opioid abuse disorder is in the low single digits, Axial Healthcare, a technology start-up that has developed a predictive healthcare platform, has arrived at a figure of 8 to 12 per cent.

People who have abused opioid-based painkillers are at a much higher risk of becoming heroin addicts. Nearly 80 per cent of heroin users in the US reported using prescription opioids prior to the illegal drug, according to the National Institute on Drug Abuse; both contain active ingredients derived from the opium poppy.

Since his brother died, Rex has tried to educate employers on their role in tackling the crisis, with varying degrees of success. In 2010, he attended a conference of 16,000 human resources professionals; just 70 of them came to a session on opioids.

It is in employers’ interests to come up with answers, however, as the crisis is costing them billions of dollars a year. The first reason is obvious: if workers are hooked on prescription painkillers, they are less likely to be able to perform their roles effectively, reducing productivity and, ultimately, profitability.

© Getty Images

The same would be true of a substance abuse crisis in any country. But the problem is particularly acute for US companies, which face a second challenge because of the vagaries of private healthcare in America. About two-thirds of citizens are in insurance plans that are funded predominantly by employers rather than by the government or out of their own pockets. The scale of employer coverage in the US is unparalleled elsewhere in the world and can be traced to wage freeze policies implemented during the second world war, which prompted companies to compete for talent by offering perks such as free healthcare rather than pay rises.

It is an absurdity, not lost on employers, that they end up paying for the painkiller pills that can lead to abuse and addiction. An executive in charge of healthcare at one large US employer, who asked not to be named, says it is particularly galling that the company is “lining the pockets of drugmakers, and the doctors who write prescriptions that are unnecessary and borderline abusive — who are throwing these pills out like they are candy”. Yet the cost of the tablets themselves is nothing compared to the cost of what happens once a person starts abusing them.

More Americans now die from drug overdoses than in car accidents or from gun violence put together © Getty Images

Of all the types of substance abuse, from alcohol to marijuana and cocaine, people who are hooked on opioids end up in hospital the most, according to the National Safety Council, a non-profit organisation focused on workplace health and safety. “Outpatient doctor visits and emergency room admissions tend to be the biggest factors,” says Tess Benham, NSC senior programme manager for prescription drug overdose initiatives. “People end up overdosing or they get impaired and end up in a car crash.”

The combined cost of lost productivity and the bill for caring for people with an opioid abuse disorder is difficult to quantify, but it is undoubtedly large. Castlight, a Silicon Valley-based company that specialises in health data, estimates the total employer outlay at roughly $18bn a year, made up of $8bn in extra healthcare spending and a further $10bn lost to absenteeism and lower productivity.

Given the huge costs, and that the opioid crisis started some years ago, it is perhaps surprising that so many employers are failing to tackle the epidemic. Part of the problem is denial. In a survey for the NSC of human resources specialists at more than 500 employers, fewer than one in four respondents agreed with the statement “misuse and abuse of prescription drugs is a problem in my workforce”.

The design of some employer-sponsored insurance plans is also exacerbating the crisis. In recent years, companies have cut healthcare budgets to boost profits, in large part by pushing a greater share of the burden on to employees themselves. The efforts were tacitly approved by the Obama administration, which wanted to turn patients into price-conscious consumers who would pick cheaper drugs and treatments, and thus reduce the nation’s soaring healthcare bill. About 50 per cent of Americans are now in “high-deductible” plans, where they are sometimes forced to contribute thousands of dollars a year towards their health costs before their insurance fully kicks in.

When it comes to treating pain, however, opioid painkillers are much cheaper than alternative and safer options such as a course of physical therapy. The differential is reflected in the patient’s personal “copay” — a fixed amount the patient has to pay towards an insurance-covered healthcare service. This might be $600 for a session with an orthopaedic physical therapist versus as little as $30 a month for a daily dose of opioids. “Employers have a really important role in designing their benefit plans to ensure that opioids are not being overprescribed, such as covering alternatives like physical therapy, acupuncture and massage — and making these available at lower copays,” says Benham.

There is a widespread reluctance among US employers to talk about opioid abuse, but some are taking action. One large organisation, which asked not to be identified, employs more than 100,000 workers, and already offers them access to a physical therapist at no personal cost. But the senior executive in charge of benefits says the group is trying to do more and has decided to take a “dual-edged approach to the opioid problem”.

“The first is a diligent focus on people who are already facing challenges. We are working hard to identify these people and get them into the behavioural health system,” he says, referring to practitioners who treat pain and related conditions such as anxiety and depression without prescribing drugs. The executive says this drive is aimed particularly at those employees who are frequently absent from work.

Second, the company is “narrowing the networks” of doctors and hospitals to which it will refer employees in case of musculoskeletal complaints. That means workers are more likely to see professionals “who are completely aware of the problem, and effective at managing pain and dealing with opioid issues”, the executive adds. Increasingly, the company is turning to sports medicine specialists who are used to treating pain in athletes, he says.

Spotting employees who are abusing opioids, or who are at risk of developing a disorder, is not always easy, and can be especially difficult in the fragmented US healthcare system. If a person changes jobs, more often than not they will also switch insurance company, meaning their records end up in two places. Warning signs, such as a person who is visiting multiple doctors to get multiple prescriptions, or who has been on the pills for more than a year, could be missed.

An overdose reversal agent that police in Philadelphia carry to deploy in emergencies © Getty Images

Axial Healthcare believes its platform — a “predictive pain management system” — could help solve the problem. The company has signed agreements with many of the biggest insurers to build a database of more than 190m people that cuts across different healthcare plans. Algorithms mine the data to identify patients who might be abusing opioids, such as those who visit multiple doctors or regularly switch their primary physician. The platform also tries to identify those who have not yet developed an abuse disorder but are at risk of doing so, such as those in pain who are taking long-term medication for conditions such as depression or anxiety.

“If you’re an employer, 40 per cent of your overall healthcare costs are going to be attributable to that 8 per cent with an opioid problem,” says John Donahue, Axial chief executive. “You need to zero in on them and get them to high-quality physicians who will be able to mitigate their behaviour and taper their opioid use down.”


Axial also offers what it describes as a “cognitive decision support system”, which syncs with a patient’s electronic medical record and automatically informs doctors when they are consulting with a patient who might be abusing opioids or is at risk of doing so. “The minute [a patient] walks in, then ‘bang’ — the physician receives an alert that tells them the person is being treated for complex pain,” says Donahue. The system then comes up with a “care pathway”, which might advise the doctor that the patient be referred to a behavioural or physical therapist, or switched to a non-opioid painkiller such as ibuprofen or naproxen.

Yet some believe employers need to stop workers ending up in pain in the first place, pointing to figures showing that rates of substance abuse are almost twice as high in physically demanding occupations such as construction, compared with desk jobs.

“Many of these people really are in extreme physical pain,” says Adrienne Abbate, executive director of a community wellness partnership in Staten Island, New York, where there is a high rate of opioid misuse, reflecting the preponderance of people working in blue-collar jobs or the police or fire services. Where workers are more prone to physical injury, employers “should have better safe workforce practices so people don’t sustain injuries on site in the first place”, Abbate says.

The opioid epidemic

183,000

Americans died from an overdose involving a prescription opioid between 1999 and 2015

30

Local authorities that have filed lawsuits against the drugs industry or hired lawyers to prepare legal action

$8.5bn

The value of the US prescription opioid market in 2016, according to Quintiles IMS

Copyright The Financial Times Limited 2017. All rights reserved. You may share using our article tools. Please don't copy articles from FT.com and redistribute by email or post to the web.