Hospitals urge lawmakers to prohibit certain health insurance pharmacy policies

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The American Hospital Association is calling on policymakers to curtail some pharmacy policies health insurers use to manage prescription drug distribution to members.

According to the hospital association, a number of large private payers are using techniques called "white bagging" and "brown bagging" to manage how drugs are used in patient care. 

Through white bagging, the association says private payers don't allow providers to procure and manage a drug for their patients, but rather require a third-party specialty pharmacy to dispense the drug to the provider. Brown bagging is similar to white bagging, but the specialty pharmacy sends the drug directly to the patient, who brings it to their provider.

Both policies "pose significant risks to quality of care as providers have inadequate control in ensuring patient access to high quality drugs, as well as the appropriate storage and handling of those drugs," the association said. 

The association had previously called out UnitedHealth Group and OptumRx in a Feb. 4 letter to acting CMS Administrator Elizabeth Richter about such pharmacy policies, but didn't specify an insurer in its most recent ask to policymakers. 

In a statement about the changes, UnitedHealthcare previously said: "As of Oct. 1, 2020, outpatient hospital providers in UnitedHealthcare's commercial network are required to source certain specialty drugs from indicated specialty pharmacies, unless otherwise authorized by UnitedHealthcare. This approach allows UnitedHealthcare to potentially eliminate unnecessary costs from the healthcare system to help make healthcare more affordable."

The hospital association is urging policymakers to prohibit the use of brown bagging, and to stop the use of white bagging when prescription doses are dependent on lab results, among other instances.

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