New Louisiana Law Bans White Bagging

On June 1, 2021, the Governor of Louisiana signed legislation that banned “white bagging” in the state, ensuring that health insurers cannot refuse to pay for approved physician-administered drugs and related services to covered patients. It is the first such law in the country.

Insurer mandates requiring patients to have their therapies dispensed via “white bagging” or “brown bagging” are becoming increasingly common. While brown bagging refers to when an insurer’s preferred pharmacy sends a drug directly to a patient’s home, white bagging occurs when a drug is delivered from an insurer’s preferred pharmacy to a physician's practice. In a letter to Acting Commissioner of the U.S. Food and Drug Administration Dr. Janet Woodcock, the American Hospital Association, the American Society of Health-System Pharmacists, and 60 health systems and group purchasing organizations expressed concern that white bagging is exacerbating “chain of custody” security challenges and risking patient safety.

Some major health insurers—including Aetna, Anthem BlueCross BlueShield, Cigna, and UnitedHealthcare—have begun to push for country-wide, mandatory white bagging. While insurers argue that white bagging lowers healthcare costs, providers and pharmacists say the practice captures more revenue for insurers and may violate patient standards of care. White bagging can also bypass safety checks, health system formularies, and care planning processes, according to its opponents, while dosing errors, delivery delays, and lost shipments are not uncommon and can negatively impact patient outcomes. Furthermore, medication that cannot be used by the intended patient may sit indefinitely on the shelf, resulting in potentially hundreds of thousands of dollars in medication waste.

But states are fighting back. Louisiana’s law addresses white bagging by banning the practice and requiring insurance companies to reimburse providers for physician-administered drugs if they are obtained from out-of-network pharmacies. Although similar legislation has stalled in other states (New York, Massachusetts, Texas), the Louisiana law passed unanimously with bipartisan support.

ACCC recently conducted a survey asking it members about their experiences with white bagging and brown bagging. More than 90 people responded to the survey, with almost 47 percent stating they had seen drug waste occur due to dose changes on the day of treatment. Fifty-nine percent of respondents said their cancer program/practice does not allow white bagging, and 78 percent said their cancer program/practice does not allow brown bagging. Patient access to care issues cited by respondents related to the systemic challenges and barriers incurred by white and brown bagging include delays in treatment, difficulties in coordinating outside drugs coming into the facility, and concerns about safety.