White Bagging Update 2023: Shifting Costs and Cancer Innovation

Ben H.

Hatched by Ben H.

Oct 21, 2023

4 min read


White Bagging Update 2023: Shifting Costs and Cancer Innovation


In 2023, white, brown, and clear bagging have become prominent distribution channels for provider-administered oncology drugs. While efforts have been made to shift towards alternative channels such as buy-and-bill, specialty pharmacies continue to retain a significant share. This article examines the latest data on this trend over the past five years and explores the potential impact on costs and patient outcomes. Additionally, we will discuss the CancerX partnership, which aims to address barriers to care and promote cancer innovation.

The Buy-and-Bill Process:

The buy-and-bill process is the most common method for distributing and reimbursing provider-administered outpatient drugs. In this process, healthcare providers purchase, store, and administer the drugs to patients. Afterward, the provider submits a claim for reimbursement to a third-party payer. The term "buy-and-bill" refers to the fact that the medical claim is submitted after the provider buys and administers the drug.

White Bagging and Cost Shifting:

White bagging has gained attention as a cost-saving measure for payers. However, a study revealed that while it lowered payers' costs, it increased patients' out-of-pocket expenses. On average, payer reimbursements were over $2,000 lower when oncology drugs were white bagged compared to buy-and-bill payments. Payments for immunotherapy were higher, while payments for supportive and other oncology drugs were lower. This raises concerns about the potential financial burden on patients.

UnitedHealthcare's Medication Sourcing Expansion:

UnitedHealthcare's Medication Sourcing Expansion policy exemplifies the practice of white bagging by a large commercial insurer. This policy mandates certain outpatient hospital providers to obtain specified specialty and oncology supportive care drugs from selected pharmacies. The program currently includes 94 drugs, and availability varies among the 12 participating specialty pharmacies. Only two of these pharmacies are affiliated with UnitedHealthcare's Optum business. This policy reflects insurers' attempts to shift costs to providers, patients, and manufacturers.

The Battle Over Oncology Margins:

The strategies employed in white and brown bagging reflect the broader battle over oncology margins. Both payers and providers are seeking ways to reduce costs and increase their share of the market. While white bagging presents an opportunity for payers to save money, providers are pushing back against mandates, highlighting the legacy infrastructure of the buy-and-bill process. This ongoing battle raises the question of who ultimately bears the burden of increased costs.

CancerX Partnership: Addressing Barriers to Care and Promoting Innovation:

The CancerX partnership has gained significant attention by attracting 91 founding member organizations representing various stakeholders in the cancer care ecosystem. These organizations include payers, providers, pharmaceutical companies, and digital health firms. By bringing together these diverse entities, CancerX aims to address barriers to care and foster innovation in cancer treatment. The partnership recognizes that advancements in drug development and targeted therapies can only be effective if patients have access to care and support.

Actionable Advice:

  • 1. Advocate for Transparent Pricing: As a patient or healthcare professional, demand transparency in pricing for oncology drugs and associated services. Understanding the cost breakdown can help identify opportunities for cost savings and ensure patients are not burdened with excessive out-of-pocket expenses.
  • 2. Explore Alternative Distribution Channels: While white bagging may offer cost savings for payers, it is essential to consider alternative distribution channels that prioritize patient outcomes and minimize financial strain. Collaborate with healthcare providers and insurers to explore options such as buy-and-bill or other innovative models that strike a balance between cost efficiency and patient-centered care.
  • 3. Support Cancer Innovation Initiatives: Engage with organizations like CancerX that are dedicated to addressing barriers to care and promoting innovation in cancer treatment. By supporting these initiatives, individuals and companies can contribute to the development of solutions that improve access, affordability, and overall patient experience.


The white bagging trend in the distribution of provider-administered oncology drugs raises important questions about cost shifting and patient outcomes. While it offers potential cost savings for payers, it also places a greater financial burden on patients. The CancerX partnership represents a collaborative effort to address barriers to care and foster innovation in cancer treatment. By advocating for transparent pricing, exploring alternative distribution channels, and supporting cancer innovation initiatives, stakeholders can work together to create a more equitable and patient-centered healthcare system.

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