Moving specialty drug administration from hospitals to homes could save $4B per year

Administering specialty drugs in physicians’ offices and patients’ homes instead of in-hospital could improve care and cut healthcare spending in the U.S. by $4 billion each year, according to a Sept. 9 report from UnitedHealth Group.

UnitedHealth’s analysis, which considered utilization and costs for all administered specialty drugs covered under UnitedHealth Group plans in 2018, found that since 2013, annual growth in per capita spending on administered specialty drugs has averaged 14%. By moving specialty drug administration out of hospitals and into physicians’ offices and patients’ homes, the health company estimates we could cut the average monthly costs of administration by 33% to 52%.

That would mean the cost of drugs and their administration would fall by $16,000 to $37,000 per privately insured patient per year for five conditions that account for over 75% of spending on administered drugs. In a pool of 180,000 patients treated in hospital outpatient settings, that translates to a savings of $4 billion each year.

“Compared to independent physician offices, hospitals charge more for specialty drugs and administration, whether treatment takes place in a hospital facility or in a hospital-owned physician practice,” the report read. “For certain administered specialty drugs, treatment at home can improve patients’ physical and mental wellbeing and reduce disruption of work schedules and family responsibilities, all without increasing the likelihood of adverse drug events or side effects.”

Savings opportunities per privately insured patient per year for the five priciest conditions were:

  • Multiple sclerosis: $37,000 savings for four months of treatment
  • Immune deficiency: $32,000 savings for six months of treatment
  • Rheumatoid arthritis: $28,000 savings for five months of treatment
  • Inflammatory bowel disease: $21,000 savings for five months of treatment
  • Cancer and chemo: $16,000 savings for four months of treatment

Find UnitedHealth’s full report online.