Case Study: Liberty Mutual Insurance achieves $10M in annual savings managing physician-dispensed drugs with Truven Health Analytics' Advantage Suite

Managing Costly Physician-Dispensed Drugs Saved Customers $10 Million

Liberty Mutual Group confronted sharply rising workers’ compensation drug costs in California after a fee-schedule loophole let physicians bill repackaged drugs at five to six times retail. Physician-dispensed drugs swelled to more than one-third of state WC drug spend—about ten times the national average—creating an urgent cost-management challenge for the insurer and its customers.

Liberty Mutual deployed Truven Health’s Advantage Suite and Red Book to capture prescription data from professional bills, translate them to pharmaceutical codes, and apply pharmacy metrics to manage physician-dispensed drugs. By negotiating with high-volume providers, supporting regulatory change (effective March 1, 2007), and cutting dispensing volume by half, customers realized an immediate $1 million savings and $10 million in annual savings after the loophole was closed.

Liberty Mutual Insurance