A new UnitedHealthcare policy requiring hospitals to use indicated specialty pharmacies for certain outpatient drugs, set to take effect April 1, could be a breach of United's contracts with hospitals and result in hospitals receiving drastically reduced payments, according to King & Spalding, an Atlanta-based law firm.
The new requirement to use specific specialty pharmacies designated by UnitedHealthcare applies to some outpatient drugs and does not apply to those supplied under member hospitals' pharmacy benefit or when Medicare or another health plan is the primary payer, according to UnitedHealthcare.
UnitedHealthcare said if a hospital doesn't obtain the drugs from an indicated specialty pharmacy, it will deny payment.
The law firm, which represents most hospitals in California, is arguing that requiring hospitals to use indicated specialty pharmacies for certain drugs would change the entire rate structure hospitals agree to in their contracts with UnitedHealthcare.
The policy could also interfere with patient care, the law firm said, as it requires hospitals to order drugs for a specific patient, track the shipping of the drug, label it for a specific patient, and store that drug separately from the rest of its inventory in a temperature-controlled environment, a practice called "white bagging."
White bagging can delay the timing of patient care because physicians may have to modify the type of drugs a patient is to receive up to a few hours before infusion depending on lab results, especially for cancer patients. If the hospital has to order the drugs days before from a specific specialty pharmacy, it may not be the right mix of drugs.
Additionally, if a patient cancels an appointment to receive that drug, the hospital is stuck with the drug, and UnitedHealthcare's contracts don't contain any compensation for extra costs associated with white bagging, according to King & Spalding.
Many hospitals don't allow white bagging because it is hard to ensure the safety of the drug, and some states, including Texas, have banned the practice because it delays patient care, according to King & Spalding.
"The specialty pharmacy policy appears to be a mechanism by United to save money for outpatient services and has nothing to do with the medical necessity of the services or the well-being of United's members," King & Spalding wrote.
King & Spalding declined to say which hospitals were clients.
UnitedHealthcare did not immediately respond to Becker's requests for comment.
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