INDIANAPOLIS – Lawmakers could focus on the controversial prescription drug practice of white bagging when they return in January.
The topic arose late in the 2021 session and legislators sought a report from state regulators before taking action. That report is now available, but it is more of a backgrounder rather than giving specific recommendations.
“Indiana must find a way to bring payers and providers together to address the root of this issue to prevent Hoosiers from bearing the negative effects of the negotiation. Patients who are already dealing with catastrophic and life-altering illness should not be asked to suffer the additional distress and harm of delayed or missed treatment. Indiana has more work to do to protect and provide the best outcomes for our citizens,” the analysis said.
The Indiana Department of Health issued the report in conjunction with the Indiana Department of Insurance, the Indiana Family and Social Services Administration and the Indiana Board of Pharmacy.
White bagging refers to when specialty drugs that must be administered by a doctor are filled and shipped to that doctor using a specialty pharmacy and paid by the pharmacy benefit, rather than the more expensive medical benefit. Insurance companies are asking hospitals to not use their own pharmacy – instead preferring a specialty pharmacy often directly affiliated with the insurer.
An example is specialty cancer cocktails and other medications for chronic conditions that must be given in a medical facility.
The state report said specialty drugs are one of the fastest growing areas of health care spending. These medications are used for relatively small number of patients but have much higher costs than traditional medications: specialty drugs account for 2% of all prescriptions but almost half of all medicine cost.
“The practice of white bagging has resulted in many different experiences and outcomes for patients and their families, both positive and negative. Drug shipments can be delayed, sometimes by several days, thereby impacting chemotherapy schedules for oncology patients,” the analysis said. “Prior authorization and network issues not only place significant time and labor burden on healthcare personnel but also result in delayed treatment. Some infusion centers may refuse to accept outside shipments from specialty pharmacies, leaving the patient without any means of treatment.”
The state's report cited several real-life Indiana patient examples, which led to treatments being delayed for weeks.
One patient with metastatic lung cancer was prescribed a drug for palliative care. The patient needed to be enrolled for specialty pharmacy services and a prior authorization was needed. After a bevy of administrative hurdles, the total elapsed time for approval of the claim was two weeks. The patient died prior to final authorization.
Hoosiers for Safe Meds, a coalition of Indiana patient and provider organizations committed to protecting patients from mandatory white bagging, has called on state lawmakers to limit the practice, which they say threatens patient safety, delays care, and compromises the integrity of specialty drugs.
“Insurance companies have represented that these measures will reduce costs, but when it comes to patient safety, no cost-saving measure is worth the risk,” said Darren Covington, executive vice president of the Indiana Pharmacists Association and Chairman of the Hoosiers for Safe Meds Coalition.
Fort Wayne GOP Rep. Martin Carbaugh, who chairs the House Insurance Committee, thinks the topic will be discussed this year. But he doesn't seem interested in big changes.
Hospitals still have an option to use their own pharmacy – but at the insurance company's reduced pharmacy pricing, Carbaugh said.
“It just comes down to money. Hospitals tend to have a much higher cost for specialty drugs, and because of that the insurance companies want to help control those costs,” he said. “I don't think an insurance company should be able to mandate they have to use the insurance company pharmacy. But price is important for the patient too. This is all about the cost.”
He conceded there can be delays, but suggests there's an option for hospitals: “My question back to them is why not just fill it at the insurance company rate?”