The Lynx Group

Brown Bagging versus White Bagging

July 2013, Vol 4, No 6

At the Third Annual Conference of the Association for Value-Based Cancer Care, several Meet the Experts roundtable discussions addressed the hottest topics in oncology. James T. Kenney, Jr, RPh, MBA, Pharmacy Operations Manager at Harvard Pilgrim, and Douglas S. Burgoyne, PharmD, President and Managing Partner, VRx Pharmacy Services, discussed the topic of brown and white bagging at one of these sessions.

“Brown bagging” is when a patient acquires specialty medication from a pharmacy and takes it to the physician’s office for administration. “White bagging” is when a physician receives a specialty medication from the pharmacy (on demand) and the patient visits the physician’s office for administration.

Brown and white bagging offers alternatives to the traditional buy-and-bill strategy and is designed to manage expensive specialty drugs.
In oncology, white bagging is the more common strategy: it allows physicians to take more responsibility for the medications, which is important for drugs with specific handling or refrigeration requirements.

With white bagging, providers need to stock and store the medication for each patient, keeping it separate from hospital and office stocks, which can be logistically challenging.

Oncology offices that continue to buy and bill often do so only for generic chemotherapy agents and not high-priced branded agents with low utilization and whose reimbursement status can be tenuous.

Oncology practices could reduce billing and administrative staff if more bagging were done (vs buy and bill).

Medication delivery logistics are handled by pharmacy benefit managers (PBMs) and specialty pharmacies, including those that are focused on oncology.

Data collection (eg, drug utilization, patient compliance) and patient services are often enhanced in these settings, relative to the traditional approach.

Key Challenges

  • The key challenges with bagging are the risk for waste, and the need for return on investment; patients with cancer may not qualify for the expensive treatment, they may have medication side effects, or their disease may have progressed, so that they cannot use the specific drug, which then must be sent back to the PBM or the specialty pharmacy, and that cost is not reimbursed
  • Patients often have laboratory testing the day before their treatment at the office to ensure that they qualify for the drug, and they return to the oncologist’s office for treatment; this can be logistically challenging
  • Communication between oncologists’ offices and PBMs or specialty pharmacies is often poor; some oncology offices are left with a drug stock or leftover drugs, which they often hold and do not get reimbursed for, and some of these drugs are administered to indigent patients, all at a loss for the provider
  • There are concerns about claims handling for drugs dispensed through the specialty pharmacy that are not obtained secondary to a physician office visit; normally, the chemotherapy agent would be handled under Medicare Part B, but the drug is then covered under Medicare Part D, because it was dispensed by a pharmacy.

Specialty Drugs Contracting
Each health plan with which PBMs contract has its own approach to the inclusion of expensive oral agents, including oral oncolytics, depending on its Pharmacy & Therapeutics committee and the tier management preferences of that plan.

Dual coverage (ie, the pharmacy and the medical benefit) is an option; all oral chemotherapies, regardless of price, are covered under the pharmacy benefit, and some are managed by a specialty pharmacy, usually based on the cost of the agent. For members in risk-sharing contracts, these medical costs are reallocated back to the pharmacy benefit at the end of the month to ensure appropriate cost accounting.

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