While hospitals are backing legislation to prohibit a method for sourcing medications known as “white bagging,” some employers say this practice saves money for them and their workers.
White bagging refers to insurers requiring patients with complex, chronic or rare conditions to obtain certain medications from specialty pharmacies.
Walker Forge CEO Will Walker — who prefers to call the practice “alternative sourcing” — says it has saved his business about $170,000 in 2021. He appeared Sunday on “In Focus: Wisconsin,” a program hosted by Spectrum News.
“We adopted free market principles and applied them to health care,” he said. “By doing this, we were able to reduce costs to a point where today we are actually able to provide free health care to our employees.”
He clarified employees still contribute a portion of the premium, but Walker Forge covers the rest of the cost for care “as long as employees go to high-value providers.” He says white bagging is “a really important part” of his company’s strategy for keeping costs low.
But critics argue that because medications are often shipped in from an outside pharmacy, delays in transportation can disrupt treatment schedules. Rep. Tony Kurtz, R-Wonewoc, appeared on the program to tout his bill aimed at stopping white bagging, called Koreen’s Law. He pointed to examples of patients with chronic conditions like psoriatic arthritis and cancer as particularly vulnerable.
“If those treatments aren’t done on time, you can actually have worse outcomes,” he said.
Vanessa Freitag, vice president of pharmacy and lab for Ascension, also expressed concern about white bagging on the show. She highlighted an “emergence in interest” among insurance companies as the practice has become more common in recent years.
“What white bagging introduces is that the medication has to be shipped from another pharmacy that is not part of the health system,” she said. “This is very disruptive to our patients. What it means is that patients really serve as their own navigator … they are accountable to work with a third-party pharmacy to make sure that medication will be dispensed to the hospital so it can be administered.”
Walker argued that because shipment of these drugs is regulated under the Federal Drug Supply Chain Act, “any suggestion that these drugs aren’t going to be handled properly … it doesn’t really hold much water.”
Two of the state’s largest lobbying interests, Wisconsin Manufacturers and Commerce and the Wisconsin Hospital Association, are on opposite sides of the issue. While WMC says stopping white bagging in Wisconsin would result in higher health care costs for employers and employees, WHA has been highlighting related patient stories about delayed drug shipments and incorrect dosing.
See the bill text here.
–By Alex Moe