New law to protect patients’ pharmacy options

STATE HOUSE – Legislation has been signed into law to protect patients from an insurance scheme called “white bagging” that interferes with how prescribed drugs are delivered and administered. The legislation, which was passed by the General Assembly earlier this month, was sponsored by Rep. Justine A. Caldwell and Sen. Linda Ujifusa.

White bagging refers to a practice where insurers require patients to get their prescriptions from insurer-affiliated pharmacies that are often mail order-only. The bill (2024-S 2086aa, 2024-H 7365A), which was signed by Gov. Dan McKee June 24, prohibits this practice.

Generally, if a patient needs a clinician-administered medication, such as a chemotherapy drug, the patient goes to the hospital where the clinician orders the needed drug from the on-site pharmacy and administers the medication.

According to the American Hospital Association, white bagging causes multiple problems. The practice is not sensitive to necessary changes in patient care plans. A health care provider often decides the patient needs a different dosage or a different drug after reviewing a patient’s labs or measurements on the day of treatment. Even though the hospital has these medications on site at their own pharmacy, they must wait for the drug to arrive from the specialty pharmacy or not get reimbursed. In addition, once filled and labeled, expensive specialty drugs cannot be substituted or modified. If the care plan is changed, often the drugs must be discarded.

The new law, which will take effect Jan. 1, will prohibit insurers or pharmacy benefit managers (PBMs) from engaging in the practice of white bagging for infused drugs. It will ensure patients receive necessary clinician-administered medications without unnecessary delays or denials from insurers and will promote fair and transparent reimbursement practices for in-network providers like hospitals and clinics.

 

The new law also calls for a report from the Office of the Health Insurance Commissioner, in consultation with health insurers and providers, analyzing the payment for clinician-administered drugs to ensure compliance with this bill, and seeking recommendations for any changes, if necessary. The report is due to the General Assembly by Feb. 28, 2026.

According to the American Society of Clinical Oncology, eight other states currently have laws prohibiting or limiting white bagging, and many other states are considering such legislation.

“White bagging is simply bad for patient care. It is a money-making effort for insurers that stands between people and the medicine they need. No cancer patient should have to wait for their insurer’s preferred pharmacy to send chemo drugs that are readily available at the facility that is administering them. This is a needless layer of profit-driven bureaucracy that we should not allow to hurt Rhode Islanders,” said Representative Caldwell (D-Dist. 30, East Greenwich, West Greenwich).

Said Senator Ujifusa (D-Dist. 11, Portsmouth, Bristol), “White bagging makes money for middlemen, but creates waste, barriers to care and disruptions to the patient-provider relationship. Across the country, state legislators are looking to audit and rein in insurers and their PBMs. This bill shows Rhode Island is prepared to join the movement to restrain vertically integrated middlemen conglomerates from making money by limiting provider care for patients.”

 

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