What Is White Bagging?

Most people who need prescription medications receive them from traditional pharmacies and take them on their own. However, there are certain medications that are dispensed by specialty pharmacies and need to be administered by a healthcare professional. This requires a visit to a hospital, clinic, or other medical facility to receive the treatment.

“White bagging” is when a person’s medication is delivered from a specialty pharmacy directly to the healthcare professional or facility. This is a common practice for injections or infusions, such as chemotherapy, that are administered by physicians or nurses. “Brown bagging” is when a person gets their medication directly from a specialty pharmacy and takes it to a healthcare professional for administration.

What is white bagging?

White bagging refers to the practice of a specialty pharmacy dispensing a specialty medication to a medical professional or facility for administration to a specific person. Typically, the prescriber must order the medication from a specialty pharmacy that’s contracted by the person’s insurance company. 

This practice is frequently used for high-cost, specialty injections or infusions, such as cancer treatments. These medications are not available in retail pharmacies.

What are the reasons for white bagging?

According to Pharmaceutical Strategies Group (PSG), a leading independent pharmacy intelligence and technology company, white bagging allows health insurance companies to manage spending on high-cost medications. They do this by working directly with specialty pharmacies. 

In a traditional “buy-and-bill” model, a healthcare professional or facility purchases a specialty medication from the manufacturer. Then, an individual’s medical benefit is charged for the medication and its administration. This often results in increased costs for insurance companies because the prescriber gets the medication at a discount but can bill the insurer at a higher rate.

EXPERT PICKS: WHAT TO READ NEXT

• What are specialty pharmacies? Specialty pharmacies offer medications and services for complex medical conditions that may not be available at traditional pharmacies. 

• Medications administered by healthcare professionals: Injections and infusions are among the medications that need to be given by healthcare professionals like nurses.

• Specialty medications in the mail: Advance planning with your pharmacy and healthcare professionals can help you get your specialty medication by mail in a timely manner.

Up to 5% of people who take prescription medications use specialty medications. But these medications account for about half of total medication spending for insurance plans. To help manage costs, health insurance companies work directly with specialty pharmacies to get medications delivered to healthcare professionals or facilities. This allows insurers to negotiate better pricing, according to the Academy of Managed Care Pharmacy (AMCP), a professional organization representing the interests of pharmacists practicing in managed care settings. 

With white bagging, a person’s pharmacy benefit is billed for a medication. And the healthcare professional administering the medication only bills the insurance company an administration fee.

What is buy-and-bill?

Buy-and-bill refers to the practice of a healthcare professional or facility purchasing and storing medication for later use. When a medication is administered, the healthcare professional or facility then submits a claim to the individual’s health insurance for reimbursement.

Under the buy-and-bill model, medications aren’t stocked for specific individuals. This means if there is a need for a medication or dose change based on day-of-treatment lab results, the prescriber can make the change without delaying treatment. 

With buy-and-bill, healthcare professionals and facilities can purchase medications at a discount and charge insurers more to derive a profit. Unlike white or brown bagging, which is billed to a person’s pharmacy benefit, buy-and-bill claims go to an individual’s medical benefit.

What’s the difference between white bagging and brown bagging?

The biggest difference between white bagging and brown bagging is who receives the medication from the specialty pharmacy. In either case, the specialty pharmacy typically bills a person’s pharmacy benefit for the medication. And the healthcare professional or facility bills the medical benefit for administering the treatment. 

Here’s a simple explanation: 

• Brown bagging: A person picks up or is shipped their medication from a specialty pharmacy and brings it to their medical appointment for administration.

• White bagging: The medication is sent directly to the healthcare professional or facility for administration.

Another common term is “clear bagging,” which is when a healthcare system’s internal specialty pharmacy dispenses a specialty medication. Because the medication is dispensed and administered in house, there’s a lower risk of chain-of-custody and quality control issues that can arise with brown bagging and white bagging.

What challenges can white bagging pose to consumers?

While white bagging can help insurance companies save money, the practice can cost consumers more. When a healthcare professional purchases a medication, the treatment and administration are billed under an individual’s medical benefit. This often means minimal or zero cost-sharing for the consumer. 

When a medication is purchased from a specialty pharmacy via white bagging, it is typically billed under a person’s pharmacy benefit — which can have its own deductible and coinsurance or copays. This shift in cost-sharing can result in higher out-of-pocket charges for individuals and families.

Shipping treatments from specialty pharmacies to healthcare professionals and facilities also leaves room for handling errors. Many specialty medications require specific storage conditions. Medications being left on a loading dock, where there’s no temperature control, and shipment interruptions due to weather can interfere with the integrity of the medications and delay treatment.

Healthcare professionals sometimes choose to adjust medication doses based on same-day lab results to ensure optimal outcomes, according to California Partnership for Access to Treatment (CPAT), a health education network focused on keeping its partners and communities informed about critical healthcare issues. A prescriber cannot immediately adjust the dose of a medication shipped from a specialty pharmacy, which can cause a delay in treatment and worsen patient outcomes, according to the American Society of Health-System Pharmacists (ASHP). 

Louisiana is among the states that have laws banning insurers from requiring white bagging to ensure patient safety and freedom of choice.

Does Medicare allow white bagging?

Yes, Medicare allows white bagging for specialty medications. With white bagging, medications are covered by Medicare Part D, a pharmacy benefit. Buy-and-bill specialty medications are charged through Medicare Part B.

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Written by:

Veneta Lusk

Veneta Lusk is a personal finance and healthcare writer with 15 years of experience. She holds a bachelor of arts in journalism from the University of North Carolina at Chapel Hill.

Edited by:

Cindy George, MPH

Cindy George is the senior personal finance editor at GoodRx. She is an endlessly curious health journalist and digital storyteller.

Reviewed by:

Alyssa Billingsley, PharmD

Alyssa Billingsley, PharmD, is the director of pharmacy content for GoodRx. She has over a decade of experience as a pharmacist and has worked in clinical, academic, and administrative roles.

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