How Infusion Medication Billing Location Affects Your Cost
Let's talk about infusions. These are medications that must be administered by a medical professional to treat chronic conditions like Multiple Sclerosis and Crohn's disease. You may have seen advertisements for medications like Stelara, Remicade, or Ocrevus.
There’s a significant price difference between these drugs when a patient receives treatment at a doctor’s office or infusion center compared to a hospital and HOW it is billed.
Because an infusion drug is not typically self-administered, it can be billed on your medical plan by a hospital, NOT on the pharmacy benefit plan. Drugs billed this way are considered J Code drugs. Essentially, any drugs billed under that designation are going to be more costly.
What Are Level I and Level II Healthcare Billing Codes?
To explain why, look at it this way. There are two kinds of coding systems in healthcare. Level I codes are used by medical practitioners to bill for claims on medical procedures.
Then, there’s Level II. This coding system, which is referred to as “J Codes”, is used for medical devices, supplies, and drugs when billing for claims to insurance. This means that an infusion drug used in a hospital can be assigned a J Code in order to be billed as a more costly medical claim, rather than a less costly pharmacy claim.
How J Code Billing Increases Your Infusion Drug Costs
Here's the problem. You likely didn't know any of this. There tends to be a lack of transparency when it comes to WHY certain drugs are billed higher than others. To be frank, getting billed under your medical policy for an infusion includes a price mark-up that could be three times higher! Understanding why carving out pharmacy benefits saves money is a critical first step toward taking control of these costs.
How to Reduce Infusion Drug Costs Through Smarter Billing
Here's the good news. There are ways around these markups and it deserves a conversation. True Rx Health Strategists would love to have that conversation with you, and help drive your drug costs down while improving the member experience. That includes exploring drug savings solutions beyond formulary that many employers and brokers don't realize are available to them.
If you’re a health care benefits broker, consultant, or an employer who wants to discuss pharmacy benefit solutions with a strategist, contact us at hello@truerx.com to arrange a meeting.
