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What is the Impact of the Opioid Crisis on Life Underwriters?

opioid crisis

This week, Senior Underwriter, Garen Markarian, explores the opioid crisis, how it impacts the life insurance industry and what life underwriters need to consider when assessing applicants with current or past usage.

When you have a mild toothache or backache, you may reach for an over-the-counter pain medication to alleviate your symptoms.  However, if you’ve ever had surgery, or suffered severe discomfort from pain, you may have required something a little stronger, such as a prescription opioid.  Opioids, such as codeine, fentanyl, and morphine, are narcotic pain medications, prescribed by a medical physician, that can potentially have serious side effects if misused or abused.

In recent news, a considerable amount of attention has surfaced regarding the impact of opioids on the health care system.  It has been described as an epidemic, with more than 2,800 apparent opioid-related deaths occurring in Canada in 2016 alone. This staggering statistic is greater than the number of Canadians who died at the height of the HIV epidemic in 1995.

In the first quarter of 2017, over 600 Canadians tragically lost their lives to apparent opioid overdoses, and the figures are estimated to be over 4,000 by the end of 2017. The situation has become so adverse, that even Walmart, the fourth largest pharmacy operator in the U.S., has recently unveiled a disposal tool to help with what is now referred to as an “opioid crisis”.

Why is the opioid crisis an important topic for life underwriters?

Given the impact of the opioid crisis on the health care system, it’s not surprising that it has also become an engaging topic in the life insurance industry. Today more than ever, life underwriters are encountering applicants with various medical conditions that require prescribed pain-relievers. Making it essential to understand the etiology of chronic pain, the medications used, and what to consider when underwriting these applicants. Below, I'll explore these topics plus how insurers may react towards trends arising from the opioid crisis.

The difference between chronic pain and acute pain

Chronic pain can be defined as pain that lasts more than 12 weeks, whereas acute pain is a normal sensation due to a possible injury that does not last longer than 6 months. This prolonged sensation can be a result of various circumstances such as illnesses, injury, surgery, cancer, or other conditions.

Illnesses can include infections, autoimmune conditions (i.e. rheumatoid arthritis), neurological, endocrine (i.e. diabetes), or degenerative disorders. Strains, nerve damage, fractures and head injuries may also contribute to chronic pain, as well as surgeries of the breast, gallbladder, cardiac, and inguinal hernias. Additionally, cancer patients may experience post-treatment symptoms, while patients with myalgias, myofascial pain, and migraines could also encounter continuous pain. Arthritic conditions and back pain are the most common reasons for chronic pain.

The impact of chronic pain on the Canadian workforce and healthcare

It is estimated that approximately one in five Canadians (~18%) complain of moderate to severe pain most days of the week, while 40% of these individuals suffer from concurrent anxiety or depression. Among those Canadians with moderate or severe pain, an average of 28.5 work days were missed during the year, 33% lost their job because of the pain symptoms, and 47% had a reduction in their job responsibilities. Combined, these work and health care losses account for a total of nearly $53 Billion a year.

Medications used to manage pain

The medications used for the management of pain can vary considerably, and are often categorized based on how and where they are targeted in the body.  Anti-inflammatories, such as COX II Inhibitors (Celebrex), steroids (Prednisone), and non-steroidal anti-inflammatories - NSAIDs (Aspirin), are commonly used to treat chronic symptoms. Other treatments include anti-depressants, muscle relaxants, atypical anti-epileptics, cannabinoids, and analgesics.

Opioids are being attributed to an increasing number of deaths

Although Tylenol (acetaminophen) is the most common analgesic, opioids have perhaps received the most amount of attention in the media recently due to the staggering number of deaths attributed to their use. Canadians aged 30 to 39 accounted for the highest proportion of deaths, at 28% overall, which included poisonings resulting from prescribed opioids, “street” opioids, and those produced illegally.  A recent analysis by CIHI reported that seniors age 65 and older had the highest rate of hospitalizations resulting from opioid poisoning in 2015–2016.

What should life underwriters consider when assessing a case with a current or past history of opioid use?

As a consequence of this increasing trend in the population, life underwriters will be expected to be more mindful when assessing applicants with a current or past history of opioid use. The frequency, dose and duration of the drug use will all be taken into account, as well as any abnormal lab test results. Additionally, and perhaps of most value for life underwriters, will be the consultation reports in the attending physician statement (APS).

Paying close attention to the charts may provide insight on recent changes in the applicant’s mood or social behaviour, past drug and alcohol use, and referrals to specialists or pain clinics. Quite often these factors are not readily recognizable on the APS but may be investigated further by questioning any inconsistencies derived from other sources (i.e. specialist’s reports, telephone interviews, questionnaires, paramedicals).

The future of opioid use

Although physicians and pharmaceutical companies are under scrutiny as a result of these trends, all sources contributing to excessive opioid use should be well investigated. An example is “doctor shopping”, when a patient obtains a prescription for a drug from multiple sources, potentially leading to abuse or misuse. Likewise, observing statistics of opioid related deaths and hospitalizations over the foreseeable future will prove to be vital for not only the insurance industry, but more importantly for providing intervention options for those who desperately need it.

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Written by: Garen Markarian

Garen is a Senior Underwriter at RGAX. He supports the RGAX Underwriting Solution Services team in providing comprehensive life insurance underwriting solutions to help carriers optimize risk management outcomes and better compete now and into the future. In addition to more than a decade of industry experience, Garen has an undergraduate degree in Neuroscience from The University of Toronto, and a post-grad diploma as a CRA from The Michener Institute.