Home Infusion: Expanding and Strengthening the Specialty Pharmacy Solutions

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Specialty Pharmacy By the Numbers

As spend for specialty pharmacy medications approaches 50% of all prescription drug revenue, payers are implementing several strategies to decrease their costs. Specialty medications can be divided into two groups: patient administered, or provider administered. Patient administered specialty medications include oral liquids, oral pills, inhalation, and pre-filled injections. Provider administered specialty medications typically require intravenous infusion by a clinician, or the patient is trained by a clinician to self-infuse. These medications are referred to as Specialty Infusible Medications (SIMs).

Taking a closer look at specialty medication expenditures in the United States, 61% of claims are processed through the pharmacy benefit manager, representing the majority of patient administered specialty medications, while 39% are processed under the medical benefit representing provider administered specialty medications. Further examination of the 39% of medical claims reveals (EMD Serono Specialty Digest, 2018):

  • • 37% of claims are processed by hospital outpatient departments (HOPD)
  • • 35% from physicians’ offices
  • • 21% in home infusion
  • • 6% in alternate site of care (ASOC) infusion centers

Under the medical benefit, the cost to payers per claim for SIMs provided in HOPDs averages 1.5 to 3 times higher than when administered in a physician’s office, home infusion, or ASOC centers. Additionally, medications billed to the medical benefit are billed using J-codes and not NDCs. This hinders payers in collecting drug rebates from manufacturers, and accurate cost reporting using WAC or AWP.

In recent years, these factors have led payers to initiate strategies to control costs billed under the medical benefit. Site-of-care strategies are one of the main approaches used by payers to steer patient care from more costly HOPDs to less costly ASOCs and home infusion. A survey of health plans showed 83% currently use or plan to use site-of-care strategies in the next 12 months. Some of the methods used are:

  • • Mandating ASOC with very limited exceptions
  • • Listing the drugs that cannot be infused in HOPDs based on a lack of medical     necessity
  • • Contacting members to provide ASOC recommendations after initial treatment
  • • Incentives for lower cost sharing for preferred sites
  • • Prior authorization required for non-preferred sites
  • • Required white bagging
  • • Billing SIMs administered in the HOPDs through the pharmacy benefit at a lower cost

Payers rated “white bagging” as their most successful site-of-care strategy followed by prior authorization required, and then mandating ASOC. (EMD Serono Specialty Digest, 2018) Health systems without home infusion services or ASOC facilities are losing these patients to competing organizations.

If that were not enough, in 2018 HOPDs received cuts to drug reimbursement when CMS implemented a reduction in payments for drugs purchased through the 340B program from ASP + 6 to ASP - 22.5%. Additionally, reductions are proposed for 2021 to reduce that reimbursement further to ASP - 27.8%. (Cook, 2020) This has resulted in some drugs costing more to purchase than their reimbursement.

These reimbursement cuts and payer reduction strategies have had a dramatic reduction on the reimbursements health systems are receiving and resulted in a loss of patients from their outpatient departments. More recently, these reductions in outpatient revenues have been further compounded by the COVID-19 pandemic, leaving health systems in search of new sources of revenue.

Patients receiving SIMs have complex and often lifelong conditions that consume large amounts of health care resources. It is in the health system’s best interest to retain as many of these patients as possible. Health systems that implement strategies to combat site-of-care issues and develop in-source home infusion services will keep patients within their system. This will result in:

  • Decreased patient leakage

  • Seamless integration and improved patient outcomes

  • Revenue from home infusion and ASOC facilities

  • Retention of earning from ancillary services such as lab and imaging

  • Manage at-risk live for ACOs with lower costs

  • The ability to optimize site-of-care

  • Increased ability to free up hospital beds and outpatient infusion rooms

  • Improved ability to accept value or risk-based contracts

  • Optimal 340B savings, if available


What should a health system do if it does not have home infusion services or ASOC facilities?

Whether you have an existing home infusion operation that needs optimization, or you are starting a new operation, Acentrus Specialty and our partners have the expertise you need. We are committed to helping health systems grow and expand their specialty pharmacy programs, including specialty infusions with the potential to alleviate site-of-care pressures, capture revenue, and deliver superior patient care.

Works Cited

Cook, E. J. (2020, August 07). Retrieved October 01, 2020, from MWE.com:


Tom Altenberger
ABOUT THE AUTHOR | Tom Altenberger
Tom has over 25 years of pharmacy management experience in retail, home infusion, specialty, and hospital pharmacy and he looks forward to using his experience to help health systems grow and expand their specialty pharmacy programs.