The hidden cost driver your pharmacy strategy is missing: Taking control of specialty infusion spend

Ask a benefits leader how their PBM is performing and you'll usually get a fluent walk-through: the rebate math, the formulary tiers, the generic dispensing rate, where the contract sits in its renewal cycle.

Ask that same benefits leader how their specialty infusion spend is performing and the conversation often gets quiet.

The reason is structural. Specialty infusion drugs are biologics and medicines used to treat chronic and complex conditions like multiple sclerosis (MS), Crohn's disease, ulcerative colitis, rheumatoid arthritis, certain cancers, and rare immune disorders. They sit on the medical benefit, not the pharmacy benefit. Most plan sponsors have significantly less visibility into medical claim mechanics than they do into pharmacy claim mechanics. That gap matters more every year, because specialty infusion is one of the fastest-growing lines in the medical plan.

Specialty infusion sits at the seam between two benefits worlds

Most benefits leaders think of drug management as a pharmacy problem: PBM contracts, formulary design, spread pricing, rebates, generics. That instinct is right for the majority of prescription volume.

Specialty infusion doesn't sit on the pharmacy benefit. Biologics like Remicade (Crohn's, ulcerative colitis, rheumatoid arthritis), Ocrevus (MS), Entyvio (ulcerative colitis, Crohn's), Keytruda (certain cancers), Gammagard (primary immune deficiencies, CIDP), and Krystexxa (chronic refractory gout) require clinical administration by a nurse or physician. Because they're administered as a medical service, they're billed under the medical benefit, typically through a J-code or Q-code claim.

That structural detail changes almost everything about how the category behaves. Traditional pharmacy management tools (formulary, rebate flows, spread analysis) don't apply cleanly. Medical claim management tools (site-of-care programs, prior authorization) apply, but they don't reach the underlying drug cost.

Three additional dynamics distinguish specialty infusion from the rest of the medical plan.

1. The growth trajectory. In 1996, roughly 30 specialty drugs were on the market. Today the number is close to 900. The pipeline is more than 7,000 drugs deep. New biologic approvals are landing in oncology, neurology, autoimmune, immunology, and rare disease every quarter.

"This problem is growing at a more rapid pace for consumers, for health plans, for plan sponsors, than just about any other category in healthcare."

— Rob LaHayne, Co-Founder, Leap

1. The cost concentration. Roughly 1 to 2% of a self-funded plan's members are on specialty infusion therapy, and that group typically drives 10 to 15% of total medical spend. Per-claim costs run in the tens of thousands of dollars, on schedules that can range from twice a year (Ocrevus maintenance) to every eight weeks (Entyvio, Remicade in maintenance) to every two weeks (Krystexxa) to weekly (Soliris, Ultomiris in some indications).
2. Chronic care versus transactional care. Traditional pharmacy is a transaction: fill a prescription, take it home. Specialty infusion is a repeated medical event across a full course of therapy that often lasts years. That changes both the patient experience and the cost structure.

How specialty infusion gets priced (and why plan sponsors can't see it)

Under the medical benefit, specialty infusion drugs are typically billed through the buy-and-bill model. The administering provider (a hospital outpatient department, an ambulatory infusion suite, or a physician's clinic) purchases the drug from a specialty pharmacy or specialty distributor, administers it, and submits a claim to the plan.

The claim arrives as a bundled total allowed amount under a J-code or Q-code. Inside that total is the drug cost, an administration fee, and whatever margin sits in the provider's negotiated rate with the plan's underlying network. The employer sees the total. They don't see the components.

Traditional models and facility fees can push the allowed amount for a single infusion claim to 4x or more above the drug's true acquisition cost.

Site of care shapes that math significantly. Most benefits leaders already understand that an MRI at a hospital outpatient department can cost $2,500 while the same MRI at an independent imaging center costs $500. The same dynamic exists in specialty infusion, but the starting number is $30,000 to $50,000 per dose, on a member receiving that treatment seven to twenty times per year. Site-of-care variance across a full course of therapy can easily reach six figures per patient.

Why traditional strategies underdeliver on cost and transparency

Plan sponsors and their carriers have tried to manage this category with three main tools. Each helps at the margin. None of them fixes the structural problem of an opaque, marked-up drug price.

Site-of-care programs. These aim to move members from hospital outpatient departments (the highest-cost site of care) to ambulatory infusion centers or home. The savings are real. But site-of-care steerage doesn't structurally change how the drug is bought and sold back to the plan.

"You're sending patients from one provider who's marking the drug up by 200 to 300% to a provider that's marking the drug up by 50 or 60%. There's still fundamentally a markup on the drug, and it's costing the employer potentially thousands of dollars each dose."

— Rob LaHayne, Co-Founder, Leap

The lower-cost site still purchases the drug on buy-and-bill. The employer is still paying an opaque allowed amount, just a slightly smaller one.

Formulary strategies under the medical benefit. These try to nudge prescribing toward preferred products (Inflectra or another biosimilar instead of Remicade, for example, or biosimilar rituximab alternatives in place of Rituxan). Necessary work, but it can also disrupt existing treatment plans and create friction with prescribers and members.

Prior authorization. Essential for utilization management. But prior auth confirms which drugs are being approved. It does not surface how much the plan is paying, or whether that price is defensible.

The result is that plan sponsors have been running site-of-care steerage as their primary lever for years without gaining real visibility into what the underlying drug cost actually is. Meanwhile, the category has kept growing. The half-measure approach has reached its ceiling.

How manufacturers see the transparency problem

One perspective that often gets left out of specialty infusion strategy conversations is the manufacturer's.

When a pharmaceutical manufacturer launches a specialty product, the commercialization strategy is built around a single core goal: patient access. They want the therapy to reach the patients who need it, remain adherent, and demonstrate clinical efficacy in the real world.

"The greatest patient access is always the most governing goal for the manufacturers. What the manufacturer doesn't control is everything in between."

— Christine Hummel, Senior Vice President of Manufacturer Relations, Leap

Whether the product is delivered through the medical benefit, the pharmacy benefit, or retail pharmacy depends on the product's molecular characteristics and administration profile. It's not a manufacturer preference.

Once a product ships from the manufacturer, it moves through specialty distributors, wholesalers, specialty pharmacies, providers, and payers. Each participant contracts and prices independently. By the time the drug reaches the patient, the employer's cost can be dramatically different from the price the manufacturer set.

For manufacturers who value transparency, this creates a real challenge. It means employers can't easily distinguish between a drug that offers strong clinical value and a drug that's simply been marked up multiple times through the supply chain. That's starting to change. Some manufacturers are increasingly open to direct partnerships that pass drug pricing through transparently to the plan.

The four structural changes that help lower specialty infusion spend

The tools plan sponsors have leaned on (site-of-care steerage, formulary management, prior authorization) have each moved the needle, but specialty infusion has outgrown all of them as a standalone strategy. Bending the cost curve requires four structural shifts that work together, each addressing a different part of how the category is priced, delivered, and coordinated.

It starts with transparent drug economics. Employers should be able to see, for any specialty infusion claim, the drug cost, the administration fee, and the coordination fee as separate line items. When drugs are billed on pass-through at true acquisition cost rather than at a buy-and-bill markup, the transparency problem gets solved at the source rather than through post-hoc claims analysis.

With pricing in the open, site of care can be chosen for the right reason: clinical fit and patient experience, not just savings. Home-based specialty infusion could be safe and appropriate for most eligible members, a stance supported by published research and by standards from the Infusion Nurses Society (INS) Infusion Therapy Standards of Practice. When home isn't clinically appropriate, ambulatory infusion centers and network-based clinics like the Leap Transparency Network fill the gap. Hospital outpatient departments should be reserved for members whose clinical picture actually requires that setting.

The right price in the right setting only holds up if the day-to-day care is coordinated. Specialty infusion is chronic care: members cycle through prior authorization, scheduling, drug delivery, prescriber communication, side-effect management, and adherence checkpoints across every dose. Fragmented handoffs generate missed doses, treatment switches driven by logistics rather than clinical need, and administrative burden that ultimately shows up in worse outcomes and higher plan spend. A dedicated Care Guide model, staying with the member from prior authorization through the final infusion of therapy, keeps continuity intact across the full course of treatment.

The final piece is what keeps the other three honest: vendor incentives that align with the plan sponsor's. That means no PMPM fees on empty seats, no fixed retainers, and no spread on drug pricing. Vendors should only earn when care is delivered.

What plan sponsors should be asking

Five practical questions to bring to your next benefits strategy conversation:

1. What am I actually paying for each specialty infusion claim? Ask for J-code and Q-code level data. Look at the variance across providers, sites of care, and even within the same drug across different members. If your top 20 specialty infusion drugs vary widely in per-claim cost across the plan, that's a signal worth investigating.
2. Where is the markup? For any specialty drug, the manufacturer's list price and, by extension, the specialty pharmacy acquisition cost are knowable. If the plan's claim allowed amount is significantly above that, the difference is markup somewhere in the supply chain.
3. What percentage of my specialty infusion spend is in the highest-cost sites of care? Hospital outpatient departments are typically the most expensive setting. Even a partial shift to alternate sites of care or home can generate meaningful savings.
4. How is patient experience affecting adherence? Members who fall off therapy because of scheduling, prior auth delays, or transportation don't just cost the plan more in the long run. They don't get better either.
5. Where does the vendor's incentive point? PMPM structures pay whether or not care is delivered. Utilization-based structures pay only on delivered care. The incentive structure shapes how aggressively a vendor will actually work to move patients out of high-cost settings.

"Regardless if you want to work with Leap, if you want to work with your carrier, or you want to work with competition out there, these are the things you need to understand when you start to talk about medical specialty."

— Raymond Brown, Clinical Pharmacy Leader, Mercer

Creating transparency through direct manufacturer partnerships

Leap operates on a different model. Rather than working within the buy-and-bill markup layer, Leap negotiates directly with manufacturers, specialty pharmacies, and distributors, and passes those negotiated prices through to the employer.

The model works because the claim is billed through Leap rather than through the administering provider. That bypasses the provider bundling that folds marked-up prices into a single J-code allowed amount. What the employer sees instead is a single itemized claim with the drug cost, the clinical delivery fee, and the coordination fee shown as separate line items.

Leap's model has demonstrated up to 60% savings on a single infusion claim*, and those savings scale across multiple members on treatment schedules that can run up to 20 or more infusions per year.

An exceptional patient experience

Cost is only half of the equation. The other half is what the member actually experiences from prior authorization through the last infusion of therapy.

Every Leap member is paired with a dedicated Care Guide, a licensed clinician who coordinates with the prescribing physician, the specialty pharmacy, and the infusion nurse. The prescribing physician remains in charge of the care plan. The Care Guide manages the logistics around treatment: prior authorization navigation, scheduling, drug delivery, day-of coordination, and clinical support throughout the course of care.

Over 90% of Leap members receive their infusions at home. The rest receive care in an ambulatory infusion center or Leap Transparency Network clinic when clinically appropriate.

"We have a 92 patient NPS. If you have a 92 NPS, you're giving patients a really great experience over and over again."

— Rob LaHayne, Co-Founder, Leap

Working with Leap to drive down specialty spend

Leap works with self-funded employers, health plans, and TPAs to deliver transparent, high-quality specialty infusion care to their members. Coverage spans all 50 states through a national network of more than 10,000 licensed infusion nurses and a growing network of infusion centers, serving both urban and rural populations.

The commercial model reflects the operating model. Leap collects fees from actual paid claims only, not through a PMPM or PEPM fee schedule. Plan sponsor and vendor incentives point in the same direction: Leap earns only when care is delivered.

The first step in any engagement is a claims-based impact analysis. That analysis surfaces actual J-code spend, drug-by-drug variance across the plan, and the specific savings opportunity available. It sets realistic targets before any commitment is made, and it grounds every downstream conversation in the plan sponsor's own data rather than in vendor claims.

To learn more about how Leap can transform your specialty drug spend, visit here.

Expert Bios

Raymond Brown, Clinical Pharmacy Leader, Mercer. Raymond leads Mercer's North American clinical pharmacy practice. He works with plan sponsors and consultants on drug spend strategy across both the pharmacy and medical benefits.

Christine Hummel, Senior Vice President of Manufacturer Relations, Leap. Christine has spent more than two decades across the pharmaceutical, pharmacy, payer, and market access ecosystem, with leadership roles at Sanofi, CVS Health, and McKesson before joining Leap. She leads Leap's manufacturer partnerships, negotiating transparent drug pricing directly with pharmaceutical companies and specialty pharmacy partners for pass-through to employer clients.

Rob LaHayne, Co-Founder and Chief Commercial Officer, Leap. Rob co-founded Leap after 20 years in employer healthcare, including as CEO of the care navigation company TouchCare. He leads Leap's commercial strategy, working with benefits leaders, consultants, and health plan partners.

*Leap internal analysis based on client and prospect claims data.