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Employers and Labor Unions Team Up To Fight Medical Fraud

Compounded drugs are a class of medications which are modified to fit each patient's needs. While they have proven slightly more effective than mainstream medications, they are also significantly more expensive. In the last year California has seen a dramatic increase in the number of employees who charge compounded drugs to the state workers' compensation insurance fund.

Labor groups, insurance companies, and many corporations who are all normally at odds with one another have come together to condemn the rising trend. They are calling it an abuse of the system and worker's compensation fraud.

Representatives from several of these groups are skeptical of the need for these compound drugs. Critics say they often contain the same ingredients as generic prescriptions and over-the-counter medications yet they cost substantially more. These drugs are seen as an easy way for pharmacies to improve profits.

A representative of the California Labor Federation spoke out against what she considers widespread abuse. She points out that these compensation insurance funds are meant to help workers. When employees unfairly benefit, the cost gets transferred to the rest of the workers in the system and everyone is hurt.

California has already seen failed legislation to discourage the use of compounded drugs. Experts say there is a powerful lobby of medical professionals who are trying to protect the profits they gain from these drugs.

New legislation has been proposed which would add certain compounded drugs to the government's fee schedule. This would limit prices on compounded drugs.

Insurers, corporations and labor groups all have a right to be upset when millions of dollars are spent on needless medications. Hopefully new legislation will be a way to stop those trying to abuse the system.

Source: Los Angeles Times online, "Unusual coalition pushes for restrictions on compounded drugs," Marc Lifsher, 28 December 2010

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