WICHITA, Kan. (KSNW) – Local pharmacies in Kansas are facing challenges leading to lower profits, and in some cases, leading them to close completely.
Pharmacy owners say a practice called white bagging is being used in a way that’s putting smaller pharmacies out of business.
Decades ago, insurance companies started working with middle men called pharmacy benefit managers.
Those pharmacy benefit managers, or PBMs, have quite a bit of control over designating when to use a practice called white bagging.
White bagging is when a patient isn’t allowed to order a medication. Instead, a medical provider has to do it.
the medication also has to be from the specific pharmacy the insurance company tells them to buy it from.
When used too often, local pharmacy owners say white bagging undercuts business and harms patients.
When AuBurn Pharmacy owner Mike Burns was diagnosed with colon cancer, chemotherapy was one of his treatments.
One of the medications he needed could commonly be found in a pharmacy.
“I had it on my shelf at the time, I went to fill the prescription and it was rejected,” Burns said. “They required me to use a specialty pharmacy.”
He says that specialty pharmacy was designated by his insurance provider and their affiliated PBM.
(DR. Madelaine Feldman
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“Everything has to go through the specialty pharmacy, and we know now why,” said Dr. Madelaine “Matty” Feldman, a rheumatologist who advocates for pbm reform. “Because they make so much money off it.”
Feldman said PBMs use white bagging more often than necessary to make it so drugs have to go through specialty pharmacies they are affiliated with.
They then hike up the price charged to insurance by thousands of dollars, and make money off the practice.
“The more that the plan gets billed… that factors in to what my premium is gonna be which effectively raises my premiums,” Burns said.
According to burns, in the end, that raises insurance costs for patients.
White bagging can be useful especially when it comes to treatments that are done in office, like some forms of chemotherapy.
It guarantees that when a patient comes in for their appointment their medication will be there.
KSN did reach out to PBMs for comment, but did not hear back.
