Site of care alone doesn’t guarantee savings. Dependable pricing does.

For two years, Matt made a four-hour round trip from his home in Mississippi to an infusion clinic in New Orleans every six months for his Ocrevus infusion. Each trip cost him a full workday, on top of the multiple sclerosis he was already managing. 

When Leap moved his care home, his physician signed off, his care team coordinated the transition, and Leap scheduled his first infusion for a Saturday so he wouldn't have to miss work again.

Matt's employer saved over $125,000 a year on his care. But that savings didn't come from the address change by itself. It came from three layers of value that Leap delivers.

That distinction matters because a lot of vendors are selling solutions that only deliver site-of-care changes.

In the first of a three-part series on what's actually driving specialty infusion costs, I want to start with an assumption that gets a lot of undeserved attention: That moving care to a lower-cost setting is enough to bring the bill down.

Site of care alone isn't driving savings

Home infusion providers have the same buy-and-bill pricing flexibility a hospital does. Nothing structurally stops a home infusion provider from marking up a drug and billing a payer at close to hospital-outpatient rates, and some do exactly that. 

Published research comparing the two settings backs this up: Home infusion charges run lower than hospital charges for the same encounter, on average. But “lower than a hospital” is a low bar, not a strategy.

Moving where an infusion happens changes the setting. It doesn't automatically change the economics behind the bill, and a benefits leader who assumes otherwise is leaving value on the table.

Three cost influencers. Most site-of-care programs impact one.

Every specialty infusion claim’s cost is built from three layers stacked on top of each other, and a typical site-of-care program only influences the first one.

• Site of care. Where the infusion happens: hospital, home, or an ambulatory infusion center. Each site has their own cost structure to provide care, and hospitals have significantly more overhead than the others. 
• The drug supply chain. These are expensive therapies, and each provider has their unique purchasing power and interest in finding a cost effective source. 
• The billing model. How the claim gets constructed and submitted. A provider working under a percentage-of-charge contract has a financial incentive to bill high, no matter where the infusion is delivered or how it's dressed up.

Impact only the first layer, and exposure to outlier costs from the other two stay exactly where they were before anyone switched anything.

This is also where a claims analysis earns its keep. Comparing what Leap procures a drug for to what a hospital billed, and comparing a home infusion provider's billed rate against that same acquisition cost, is the only way to know whether a site-of-care shift actually changed the economics. Without that comparison, a lower total on paper can still be hiding markup at a smaller scale.

Building for clinic or home without a cost impact

An additional 30-40% of infusion therapies can be delivered at home. Some treatments, often for oncology or a patient’s first dose of a new drug, carry a real chance of a reaction and should be in a clinically appropriate location. While home infusion is preferred by the majority of patients, that’s not the case for everyone. 

Regardless of where care is delivered, significant cost savings occur when you eliminate drug markups and improve the billing model. That’s why care in a clinic shouldn’t be discouraged; it’s simply a question as to the price transparency provided. 

Getting the price to hold steady no matter which setting the clinical need points to is worth its own look. It starts with treating home and clinic as equally legitimate options.

What to ask instead of asking about site of care

The core question you want to ask is, “Is your specialty infusion therapy program doing what it’s supposed to be doing?” That’s a much more important question than asking where an infusion happens. 

The same logic applies for consultants building a point of view for their book of clients. A vendor that can describe its site-of-care numbers in detail but goes quiet on acquisition cost and claim structure is offering a smaller markup isn’t helping you save as much as you could be. 

Real savings require pricing the drug, the coordination, and the clinical administration consistently, in every setting a member's care might happen, no matter where they live. A member in a market with one dominant hospital system shouldn’t cost an employer significantly more than another member on the other side of the state to receive the same drug. 

For Matt, that meant getting his weekends back and staying home with his family instead of losing a workday to a four-hour drive. For his employer, it meant a transparent bill that reflected what the care and drug actually cost.