LA: Louisiana bans insurers from controversial ‘white bagging’ practice

Beckers Hospital News –

A new law in Louisiana will bar health insurers from implementing a pharmacy policy known as “white bagging.”

White bagging is when health insurers don’t let providers procure and manage a drug for their patients, but rather require a third-party specialty pharmacy to dispense the drug to the provider.

Health insurers have argued that healthcare costs can be lowered if members get prescription drugs from in-network specialty pharmacies. However, hospitals have called on lawmakers to limit the practice, which they argue can threaten care quality.

Under the new law, effective June 1, Louisiana health insurers can’t deny payment to participating providers because they received physician-administered drugs from a pharmacy that isn’t in a health insurer’s network.

Additionally, health insurers in the state will have to pay providers at the rate outlined in their contract agreement. If a rate isn’t included for a particular drug, then reimbursement will be at wholesale acquisition cost, according to the law.

Louisiana lawmakers said this will “ensure that health insurance issuers do not interfere with patients’ freedom of choice with respect to providers furnishing physician-administered drugs and ensure that patients receive safe and effective drug therapies.”

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