Today we offer a review of a recent report issued by the American Hospital Association (AHA) wherein the association excoriates payer practices that ‘force’ the use of the onerous practices like white bagging and prior-authorizations….. “practices that delay patient care and raise administrative costs.”
Let’s look at white bagging since everyone is up to date on this model after reading our report on the practice earlier this week.
The AHA says “white bagging prohibits providers from using their own medication inventory.” What the AHA is really saying is that hospitals want to use the product they have purchased so they can bill for it at their usually exorbitant, marked up rates.
AHA goes on to claim that “white bagging compromises patient safety and adds significant complexity to the healthcare system and tremendous administrative burden to providers who are trying to manage these policies on behalf of their patients. There are several safety issues that come with white bagging including delaying care when medications are not delivered on time and preventing providers from validating that specialty medications were managed appropriately when being delivered. These medications often have temperature and handling requirements.”
A response from American Health Insurance Plans (payors) disputes these claims. AHIP states that “specialty pharmacies have to meet extra safety requirements for specialty drugs that are imposed by the drug manufacturers as well as by state and federal legal and regulatory requirements.”
Very few therapies are needed on a ‘stat’ / life threatening basis. Even-hospital owned therapies would be on the shelf waiting for payor prior-authorizations, so the delays, which can often run days or even weeks, are shared regardless. And, specialty pharmacies can reliably ship a therapy the same day as a prior authorization is approved for delivery next day. As we know, specialty pharmacies have excellent performance records relating to safely shipping medications within rigid temperature and handling requirements.
As the article concludes….. the “report is evidence of the longstanding rift between providers and payers.” Some things are never likely to change.
American Hospital Association Turns Up the Heat On Commercial Insurers In Scathing Report
However, insurers’ practices, such as white bagging, are needed to reduce costs for patients says America’s Health Insurance Plans
Commercial health plans use practices that delay patient care and raise administrative costs, a recent report by the American Hospital Association charged.
The report listed several practices that it says burdens providers and harms patient care. This includes prior authorization, the process that determines if a payer will cover a service; fail-first policies, in which patients try and fail certain treatments before insurers authorize more costly treatments; white bagging, which prohibits providers from using their own medication inventory; and several others.
“Some commercial health insurers have implemented policies that add billions of dollars in added unnecessary administrative costs to the healthcare system while compromising patient care,” AHA states. “Commercial health plan abuses must be addressed to protect patients’ health and ensure that medical professionals, not the insurance industry, are making the key decisions in patient care.”
Some of these practices are needed to reduce expenses for patients, countered Kristine Grow, senior vice president of communications at America’s Health Insurance Plans. But the two topics in the report Grow particularly pushed back against were prior authorization and white bagging, also known as specialty pharmacies.