Most of us are familiar with pandemic supply chain issues and associated price increases, but for health care providers, those challenges are combining with prolonged drug and supply shortages, staffing challenges and other market dynamics to stress their ability to provide services to patients who need them. In the home infusion industry, these factors have coalesced to impact the most resource-intensive therapies, such as parenteral nutrition (PN) and IV anti-infectives.
For example, a recent white paper by the National Home Infusion Association (NHIA) analyzed pandemic-related cost increases for PN components and disposable supplies. The analysis of 402,940 bags of PN from 12 home infusion providers found the cumulative five-year price increase per bag of PN is 50.12% more than 2016 costs. In addition, the mean overall cost increase for 223 disposable supplies in 2021 was 9.88%. Before 2021, the typical cost increase was 5% annually.
Disposable supplies are bundled with professional services, equipment and administrative costs and paid as a set per diem amount to the provider each day the patient infuses the medication. In most cases, drugs are billed separately, so as the cost of a drug increases over time, the indexed allowable for the drug also tends to increase. The exception to this rule is drugs that are considered standard ingredients in PN. Unlike other therapies where drugs are billed separately, standard PN nutritional components are all bundled into the per diem payment.
With reimbursement relatively fixed, providers have almost no flexibility to offset the rapid increases in acquisition costs resulting from shortages. That’s not even considering the increased cost of labor in a sector marked by pandemic fallout. Providing services under these pressures for reimbursement that has not kept pace is becoming more and more problematic. Providers are facing difficult decisions that, if adopted widely, have the potential to impede patients’ access to care. We saw this last year when a national infusion provider realigned their business strategy, consolidating branches and shifting therapeutic focus.
Conversations With Payers
Over the past year, NHIA has been working to bring issues like this to the forefront with commercial payers. We aim to better partner with them to achieve their goals of lowering the total cost of care. It’s important that they have a full understanding of the context in which home infusion providers are delivering high-quality, cost-effective care
to ensure fair and sustainable access
Last fall, NHIA held its inaugural Home and Specialty Infusion Payor Summit, where payer representatives with responsibilities for benefits structure, network decisions, value-based programing and specialty pharmacy policy were invited to attend and discuss ways to improve access and efficiencies associated with home- and alternate-site infusion services. The result of that meeting was the development of recommendations designed to be incorporated into contracts between health plans and providers. The association encourages payers to:
- Establish distinct specialty networks of locally based, full-service infusion providers to offer infused medications
- Require the coordinated provision of infusion supplies, equipment, and services
- Address the lack of coverage for resolving catheter occlusions
- Incentivize infusion providers to place peripherally inserted central catheters
- Add codes for use of ambulatory infusion suites to home infusion contracts
- Allow home infusion providers to provide nursing for managed Medicaid patients, especially pediatric patients
- Remove multiple therapy discounts for complex patients
- Coordinate and/or combine prior authorization procedures for home infusion drugs and services to avoid delays in treatment due to having to wait for separate authorizations
These recommendations are intended to remove barriers to accessing certain infusion services. For example, a payer may not realize that by changing their coverage policies to allow a home infusion nurse to go out and resolve a catheter occlusion, they can reduce ER visits. Removing barriers allows payers to reduce the total cost of care by avoiding hospital stays and emergency room visits, limiting hospital outpatient department use and preventing admission to long-term care facilities.
This also holds true for the issue of sharp supply cost increases not being reflected in per diem rates. If an organization can no longer afford to provide a therapy, that doesn’t change the fact that patients need it. Patients truly value the flexibility of home- and alternate-site infusion, and for patients in rural areas or with transportation challenges, home-based therapy provides access to care they might not otherwise have.
Accordingly, payers understand that for many therapies, home infusion is an optimal site of care. The alternatives—inpatient care, long-term care facilities and hospital outpatient departments—are costly, undesirable and unnecessary.
To address the skyrocketing costs of PN components and supplies and ensure continued availability of these essential treatments, NHIA recommends payers consider the increased cost of items and services included in the per diem payment bundle as they negotiate rates with providers and ensure that payment reflects the complexity of the care being provided.
Ingredient costs aside, PN is also one of the most clinically intensive therapies for pharmacists, dietitians and nurses. A recent study published in Infusion Journal showed that pharmacists spend on average more than 40 minutes per day providing clinical support such as monitoring labs, responding to pump questions and making formula changes in response to changing nutritional needs. To ensure patients retain access to these services, payers should review their PN payment policies to ensure they align with the HCPCS code description and allow providers a to bill separately (outside of the per diem) for lipids, specialty amino acid formulas and other non-standard drugs.
Health care delivery is complex and interrelated. The challenges and pressures affect each unique discipline differently, but one thing holds true: Patients’ access to care relies on payers and providers aligning their interests based on a deeper understanding of one another.
NHIA is encouraging payers interested in continuing this dialogue to sign up to be included in a future payor summit at nhia.org/payors