A New Hampshire law effective in 2027 restricts insurers from forcing medical practices to use white-bagged or brown-bagged drugs without consent.
Most New Hampshire medical practice owners don't realize that insurers and pharmacy benefit managers (PBMs) have been able to force them to accept drugs supplied by third parties—a practice known as white-bagging or brown-bagging—without their agreement. That changes under SB256.
White-bagging and brown-bagging are terms for when an insurer or PBM requires a medical practice or infusion center to administer drugs that the insurer or PBM supplies directly, rather than allowing the practice to purchase and bill for drugs through its own supply chain. The practice administers the drug but doesn't control its sourcing, storage, or quality assurance.
For practices that treat patients with biologics, chemotherapy, immunotherapy, and other clinician-administered drugs, this arrangement has created operational friction and financial pressure. Practices lose control over their drug supply, face liability issues if supplied drugs are damaged or expired, and lose the revenue margins associated with buying and billing their own inventory.
Section 1 of SB256 amends RSA 420-J:28(I) to prohibit insurers and PBMs from mandating white-bagging or brown-bagging without the written consent of the medical practice or infusion center. In plain terms: starting January 1, 2027, your practice cannot be forced into a third-party drug supply arrangement. You retain the right to source and bill for clinician-administered drugs yourself—and insurers must get your permission in writing before requiring otherwise.
This restores negotiating power to practices. If an insurer wants to require white-bagging or brown-bagging, it must now ask. Your practice can evaluate whether the arrangement makes sense for your operations, liability profile, and revenue model before agreeing.
The law applies to medical practices and infusion centers in New Hampshire that administer drugs on behalf of patients covered by health insurance. If your practice administers biologics, chemotherapy, specialty infusions, or other clinician-administered medications, this provision directly affects your relationship with insurers and PBMs.
Smaller practices and independent infusion centers are likely to see the most immediate benefit, as they often lack the negotiating leverage of large health systems and have been more vulnerable to insurer mandates.
Review your current contracts with insurers and PBMs to identify any existing white-bagging or brown-bagging arrangements. Understand which drugs are affected and what your current terms are. When the law takes effect on January 1, 2027, you'll want to be ready to renegotiate or formally consent to any arrangements you wish to continue.
If you're considering changes to your drug sourcing or billing model, this is a good time to consult with your legal and compliance advisors about how the new rule affects your options.
Source: New Hampshire SB256, Section 1, RSA 420-J:28(I), effective January 1, 2027.