The Infusion Cost Crisis: Why Medical Benefit Drug Spend Keeps Escalating

Infusion therapy plays a critical role in treating many chronic and complex conditions, from autoimmune diseases to cancer and multiple sclerosis. For employers, however, infusion care has quietly become one of the fastest-growing and least understood drivers of medical spend.

The issue is not the therapy itself. It’s how infusion drugs are billed.

Most infusion drugs are reimbursed through the medical benefit, not the pharmacy benefit. That distinction may sound minor, but it has created a cost structure that is opaque, difficult to manage, and largely insulated from the pricing controls employers expect elsewhere in their benefit strategy.

The result is an infusion cost crisis hiding in plain sight.

Why infusion costs are so hard to see

In the traditional pharmacy world, rebates are financial incentives paid by drug manufacturers to Unlike traditional pharmacy drugs, most infusion drugs are billed using J-codes and Q-codes which are medical billing codes used when drugs are administered by a provider rather than dispensed by a pharmacy.

Because these drugs run through medical claims:

• Pricing is tied to provider charge structures rather than acquisition cost
• Medical plans are not incentivized to negotiate these low volume claims
• Costs are bundled with administration, supplies, and facility fees
• Employers see only the total insurance negotiated allowed amount, not the true drug cost

What looks like a single infusion claim is actually a collection of charges layered together, each contributing to a much higher total cost than the drug itself.

How infusion costs escalate

A typical infusion claim includes multiple components, such as:

• The drug itself, billed under a J or Q code with a markup applied by the provider
• Time-based infusion administration charges
• Supplies, labs, and clinical monitoring
• In many cases, hospital facility fees and overhead

Because reimbursement flows through the medical benefit

• Drug pricing is rarely benchmarked to true acquisition cost
• Site of care has a significant impact on total allowed amounts
• Hospitals have stronger negotiating leverage and receive much higher reimbursement than other providers
• Employers have no visibility into how much of their spend reflects margin versus care

These dynamics create infusion claims that far exceed the actual cost of the drug and its administration.

An illustrative example: Ocrevus® infusion

Ocrevus®, a commonly prescribed infusion therapy for multiple sclerosis, is typically administered twice per year. While pricing varies, the economics of a single infusion often look like this:

Per infusion allowed amounts (illustrative):

• Drug acquisition cost: $34,000
• Buy-and-bill markup applied by the facility: 290%
• Allowed drug reimbursement: $100,000
• Infusion administration and supplies: $2,000

Total claim amount per infusion: $102,000
Annual allowed amount: $204,000

Nearly all of the total spend is driven by provider margin rather than the drug itself.

How did we get here?

Most infusion drugs are reimbursed under a buy-and-bill model, where providers purchase the medication upfront and are reimbursed through medical claims based on billed charges.

This structure:

• Incentivizes higher markups on high-cost drugs
• Shifts significant pharmacy-like spend into the medical benefit
• Limits transparency for employers reviewing claims

Medical plans reimburse based on established provider charge structures rather than true drug acquisition cost.

The result is a system that rewards opacity, not efficiency.

Why employers stay stuck

Even when infusion costs are identified, many employers hesitate to act.

Common concerns include:

• Fear of disrupting care for vulnerable members
• Perceived safety risks outside of hospital settings
• Sensitivity around provider relationships
• Uncertainty about member acceptance of alternative sites of care

These concerns are understandable. But they often prevent employers from addressing a structural pricing issue that has little to do with clinical decision-making and everything to do with how care is billed.

The opportunity for employers

The good news is that reducing infusion spend does not require changing medications, forcing site-of-care decisions, or disrupting provider relationships.

Real savings come from:

• Transparency into J- and Q-code drug spend
• Understanding how much cost is driven by margin versus care
• Identifying clinically appropriate site-of-care options
• Coordinating infusion care more intentionally

With the right data and care coordination, employers can reduce infusion costs while preserving quality, safety, and member trust.

Turning insight into action

Most employers do not know:

• How much they are spending on infusion drugs today
• Which conditions and drugs are driving repeat infusion costs
• How much of their spend reflects provider margin and facility fees

Leap helps employers analyze infusion claims, identify hidden cost drivers, and uncover opportunities to reduce spend without disrupting care plans or limiting provider choice.

Take the first step

Infusion costs don’t have to remain a blind spot.

Understand how infusion spend is impacting your plan. Request a claims-based infusion cost analysis to see where costs are escalating and where meaningful improvement is possible.