Closing the Door on Pain Management Abuse

Taking a closer look at opioids, compounds, and injections in auto accident claims

April 24, 2020 Photo

The inclusion of pain-management specialists in multi-disciplinary clinics over the last several years in the no-fault claims industry has grown rapidly. Unfortunately, it has also opened the door to fraud.

More claims are being presented to auto insurance carriers for various types of pain management services, which has resulted in costly exposures related to first-party, no-fault claims and an increase in third-party claims settlement values and demands related to bodily injury.

The fraud is in overpricing and the unnecessary use of these items, so pricing and medical necessity are clear defenses to these claims. Areas of pain management include opioid medications, compound creams, trigger-point injections, facet joint injections, and epidural injections.

Handling Compound Creams

Compounded medications are based on a practitioner’s prescription, in which individual ingredients are mixed together in a strength and dosage according to the patient’s needs. Despite scientific evidence that they are useless in pain treatment, compounded medications have seen a sharp uptick in usage, even though it can cost up to $2,000-$4,000 per tube or jar.

Research from the California Workers’ Compensation Institute cites a quadruple increase in usage of compound medications from 2010-2016, while the average amount paid for compound medication prescription increased 68.2 percent from $460.42 to $774.21.

Compounded medications contain numerous types of medications, some even with the same therapeutic class, which could lead to drug interactions. As a result, workers compensation payers are skeptical of the medication’s therapeutic value out of concern for the injured parties’ safety.

If a claim is presented relating to a compounding cream or drug, the carrier can ask for verification that the compounding pharmacy is accredited by going to the Pharmacy Compounding Accreditation Board website at

Further, verification of the prescription demonstrating specific detail to the patient in question is a must. If the prescription is generic or is related to multiple claims from the same clinic, then this should prompt an SIU investigation. It’s also recommended to research the item being prescribed, request an examination under oath or recorded statement, and ask the insured to bring the compound to be examined.

Additionally, medical records of the prescribing provider should be checked to see if they indicate how the patient would be helped by the use of the compound cream; if the prescribing physician supports the medical necessity of the cream with clinical studies; if the patient has any issue taking oral medications as opposed to compound creams; if the patient ever discussed with the physician oral medications in lieu of the compound cream; and if the pharmacy is accredited. If possible, request an examination under oath in your jurisdiction of the medical provider and/or pharmacy to verify.

When defending compound claims in arbitration, be sure to locate all medical records that would not support the use of compound creams. Make sure all medical records are uploaded to an arbitration platform that would support a defense that the use of a compound cream was part of a protocol treatment and not specific to the patient in question.

Further, if the compound cream is mentioned in any of the prescribing physician’s reports as part of the treatment plan, double check to see if the physician mentions in the records prior to prescribing the compound that other pain medications were tried. Do the prescribing physicians offer any explanations as to why they ordered the compound creams?

Demonstrating the lack of documentation in post-prescription records or in any follow-up evaluations that the specific effects of the drug were not being properly evaluated and integrated into the treatment plan would support the defense. Also, use independent medical examinations and peer reviews to comment on and document the lack of necessity for the compound cream.

Lastly, use the patient’s own records to show a lack of documentation supporting the use of the cream.


Although there has been a drop in the usage of some pain creams, there has been an increase in the use of trigger point, facet joint, and epidural injections in the auto no-fault arena. Both the epidural and facet joint injections are performed in ambulatory surgical centers, which is causing an inflated no-fault indemnity risk because the ambulatory surgery centers charge a high facility fee. Some medical journals have indicated that epidural injections do not need to be performed in an ambulatory surgical center and could be done in an office. This can be used in defending injection claims.

Medical science also dictates that there should be conservative methods attempted for a whiplash-related injury prior to the use of any type of injection; certainly trigger points. However, a trend in auto no-fault claims is the use of trigger-point injections immediately within the patient’s care and repeated every 30 days. Trigger-point injections with fluoroscopic guidance are usually performed in an office, and are a way to enhance a claim’s value.

There has also been a surge in the use of epidurals on a 30-day cycle. Investigations have determined that no-fault medical providers will claim that epidurals or trigger points were done in the ambulatory surgical center and under anesthesia due to a patient’s phobia of needles. This is hard to substantiate when defended by the carrier specifically when the patient had just gone through a battery of EMG/NCV testing prior to the epidural injections.

The facet joint injection, which is a local pain management procedure in the spinal column, is also used to drive up the cost of a claim and increase settlement value. Facet joint injections, often in conjunction with lidocaine, are used to remove pressure off the disc region.

Facets and epidurals have a major effect on the bodily injury claim value. If two or three epidurals or facets are performed under anesthesia during a patient’s clinical treatment, this equates to an argument by the bodily injury attorney that the patient underwent surgical procedures. They equate the epidural to a surgical procedure and, therefore, claim the value of the bodily injury case has increased dramatically.

How to Combat Abuse

State regulations are more commonly used to regulate the prescription use of opioid medications. Measures that can be taken by SIU include:

• Investigating staged activity, runner schemes, and inspections of abusive clinics.

• Reviewing the treatment protocol at these facilities.

• Conducting examinations under oath of patients and providers, depending upon the state and jurisdiction regulations.

• Reviewing medical and expert consultation records.

Medical science does not support the use of narcotic pain medicine for the treatment of most pain complaints associated with injuries related to automobile accidents. The excessive use of trigger-point injections and epidural injections is an indication of pain-management abuse, which requires further review.

To curtail the abuse, look to state regulations and your own SIU investigations, and commence affirmative actions against bad players. There is no sign of this abuse ending, so it is imperative to take an affirmative stance, begin an investigation into these types of providers as soon as possible, back it with your expert consultations, and defend these claims to the best of your capabilities.

About The Authors
Multiple Contributors
Vincent F. Gerbino

Vincent F. Gerbino is managing partner at Bruno, Gerbino, Soriano & Aitken, LLP.

Cathy Gicker

Cathy Gicker is a senior claims consultant with Allstate Insurance.

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