Benefits and Challenges of White, Brown, Clear, and Gold Bagging

Our expert explains how the bagging process impacts health systems and patients.

Read time: 6 minutes

By: Lindsey DeMarrais

We recently sat down with Lindsey DeMarrais, PharmD, MS, Managing Consultant with McKesson Advisory Services, to discuss white, brown, clear, and gold bagging in relation to health systems and patients. In this informative Q&A, she shares her insights on how each practice works and their overall impact on the healthcare system.

Q: What are the various challenges for health systems within white bagging, brown bagging, and clear bagging practices?

A: The biggest challenges for health systems around bagging practices are patient care coordination, and the impacts of bagging practices to operations and finances, but to understand how, we need to examine bagging practice separately.

Brown bagging is a process where a specialty pharmacy dispenses a specialty medication to a patient that will eventually be administered within a clinic or provider office. This type of bagging has benefits and challenges for health systems.

White bagging removes the patient responsibility for drug integrity; however, it introduces challenges with inventory management and care coordination. In white bagging, the patient’s medication is shipped from a specialty pharmacy that is external to the health system directly to the clinic or provider office where it will be administered to the patient. The patient’s medication is stored at the clinic until their appointment, which can create inventory challenges for clinics as they store medications for many individual patients and medication orders can change, potentially resulting in waste. Further complicating the process, the care team must coordinate with the external pharmacy to ensure the medication is delivered before the patient’s appointment, which can be logistically challenging and introduces the potential for treatment delays.

Clear bagging is where health system specialty pharmacies have more control and transparency. The pharmacy must be in-network with the payer (also known as payer access) and have access from the manufacturer to dispense their medication (also known as LDD access). Once the pharmacy has obtained payer and manufacture access, they can dispense the medication from their own internal pharmacy. The health system coordinates with internal teams to bring it to the clinic where it will be administered to the patient, keeping all touch points internal. This higher level of transparency and coordination reduces delays and is preferred by most health system specialty pharmacies. This also allows the pharmacy to bill for the medication, keeping the financial accountability and revenues internal.

Recently the term gold bagging has been used to describe the scenario where a health system specialty pharmacy team coordinates all points of treatment, from prescribing through dispensing and ultimately administering internally, while holistically supporting the patient at every step to better manage their care. As health system owned specialty pharmacy programs have evolved to offer more comprehensive care, so has their level of service.

Q: What makes white, brown, clear, and gold bagging different from the traditional “buy and bill?”

A: One of the main differences between white, brown, clear, and gold bagging versus a buy and bill process is the insurance billing, which then drives changes to financials and operations.

During the buy and bill process, medications are billed through medical benefits. The clinic procures medications, stores them, and then administers them to the patient from their own inventory. Patients typically receive their bill for their medication administration after the visit.

When bagging processes are utilized, claims are processed through pharmacy benefits and dispensed from a pharmacy. Pharmacies maintain inventory until the medication is dispensed on behalf of the patient. When bagging occurs, the patient is paying a copay up front before the medication is administered.

When health systems have control over the procurement of medication, hospitals can better manage medications, supply chain integrity, and alleviate the administrative burden for patients. This helps them to prevent treatment delays, and the health system can save costs and prevent waste.

As each method of bagging presents its own unique challenges and opportunities. McKesson’s RxO Advisory is here to help you navigate the complexities in the specialty pharmacy ecosystem to optimize your specialty pharmacy program and the patient journey.

To learn more about McKesson’s pharmaceutical distribution and solutions for health systems, contact our team.

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