The Biden administration has made health equity a priority and it has been a constant theme of conversation on Capitol Hill. But where do we go from here? One place is stopping health insurance companies and pharmacy benefit managers from pulling the rug out from underneath people who need help affording their medications through copay assistance.
Over the past few years, health plans and PBMs have changed the rules on how they count copay assistance programs, padding their own profits and putting patients who rely on help affording their medications in an untenable situation.
Millions of Americans rely on copay assistance — coupons, discount cards, vouchers, and other programs — to afford their prescribed medications. Copay assistance helps by bringing down the out-of-pocket cost for medications.
If Washington is serious about making medicines more affordable and stopping health plans from engaging in deceptive practices that hurt and confuse patients, the Biden administration and Congress should require all commercial health plans and PBMs to count the value of copay assistance toward a patient’s cost-sharing requirements. It is a simple solution that will help already vulnerable patients afford their medically necessary prescription drugs.
Under a “copay accumulator adjustment program,” as they are often called, the value of the copay coupon, voucher, or other assistance program no longer counts toward a patient’s annual deductible or out-of-pocket cost sharing limit.
By not counting copay assistance toward patient out-of-pocket costs, insurers and PBMs are able to collect the same amount of money a patient would contribute to their deductible multiple times. Let’s say Jane Doe uses a $50 copay card to afford her medication. Under a copay accumulator, that $50 does not apply to her deductible. When that $50 has been used up, Jane is still responsible for paying the same out-of-pocket amount again to get closer to her deductible because — in the eyes of the insurer or PBM — she has done nothing to pay it down with the $50 copay assistance. Insurers and PBMs cash in twice in this scenario by pocketing the $50 copay card value and any future amount Jane will pay that will finally apply to her deductible.
Today, these policies are more prevalent in commercial health insurance plans than ever before. According to a 2021 report from the AIDS Institute, 90% of all U.S. states have implemented these policies in at least one Affordable Care Act insurance plan offering. The same report found that every marketplace plan includes a copay accumulator policy in 14 states.
More than 2 of every 3 Americans abandon their prescription medication when their out-of-pocket costs reach $250. Deductibles can be as high as $7,000 for an individual ($14,000 for a family) for all out-of-pocket health care services in 2021; in essence, an individual could be required to pay up to $7,000 out-of-pocket before their insurance would kick in to cover the cost of their medications.
Washington is now getting a better sense of just how difficult 2020 was for Americans, especially those who rely on copay assistance programs to afford their prescription drugs. According to a new national survey conducted by the National Hemophilia Foundation (NHF), which we work for, and four other national patient organizations, nearly half of patients and caregivers (46%) say they or someone in their immediate household has not been able to afford their out-of-pocket costs for medications in the past year. One in three individuals who said they were unable to afford their medications because their copay assistance ran out was a person of color. Sixty-five percent of patients and caregivers in the same national survey reported either currently using or having used copay assistance to afford their medications, and 6 in 10 say they would have extreme difficulty affording treatments and medications without copay assistance programs being applied to their out-of-pocket costs.
Covid-19. Rising insurance premiums. The expansion of high-deductible health plans. As if patients were not already bearing the deep burden of higher out-of-pocket costs, insurers and PBMs are making things worse by not counting the value of copay assistance. Fortunately, 11 states and Puerto Rico have taken legislative action to protect people from these insurance policies, and there is bipartisan support in Congress for a federal solution.
Led by Reps. Donald McEachin (D-Va.) and Rodney Davis (R-Ill.), more than 50 lawmakers delivered a letter to President Biden in March asking him to protect individuals from copay accumulator policies through the annual Notice of Benefit and Payment Parameters, a regulation that the Department of Health and Human Services has inconsistently used to address copay accumulator policies over the past several years.
That letter is just a start. Biden, HHS, and Congress have it within their power to require health plans to count the value of copay assistance toward patient cost-sharing requirements and help people afford their prescriptions, something they should do this year.
Lawmakers cannot erase overnight the deep inequities and affordability challenges that exist within the U.S. health care system. But counting the value of copay assistance toward a patient’s out-of-pocket cost responsibility would provide a safeguard to allow many more Americans to afford and access their medications.
Kollet Koulianos is the senior director of payer relations for the National Hemophilia Foundation, where Keri Norris is the vice president of health equity, diversity, and inclusion.
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