As patients struggle with healthcare costs, an often-overlooked cost driver is the health insurer’s use of copay accumulator programs. A recent analysis found these programs disproportionately affect patients suffering from chronic illnesses.
Health insurers implement copay accumulator programs that prohibit copay assistance — such as rebates or programs provided by pharmaceutical manufacturers — from counting toward the patient’s cost sharing. Once a patient uses up any assistance, they are still responsible for their entire copay and maximum out-of-pocket expenses. This takes away patient support and harms them by exposing them to unexpected out-of-pocket costs. It shouldn’t matter who contributes to a patient’s costs; any contributions should count toward a patient’s out-of-pocket expenses.
Copay assistance programs are critical for patients and are especially important for those with chronic conditions who must rely on brand-name medications because a generic is not available or is not an effective treatment for the individual patient.
In the past, the payments made by these programs counted toward patient deductibles and maximum out-of-pocket costs. Unfortunately, copay accumulators now prevent these payments from counting toward a patient’s cost-sharing, and their broad implementation has resulted in many patients paying more for their medications.
A new analysis by Xcenda, a life-sciences research company, found that copay accumulators result in higher out-of-pocket patient costs. The report examined the average monthly costs of medications with and without copay accumulator programs for patients diagnosed with common chronic diseases. According to the findings, patients saw substantially higher costs under these programs, facing an increase of $4,000 to $4,200 yearly in three of the four chronic diseases examined.
At the same time, patients face higher costs to access these needed medications, and insurers are reducing their expenses. The brief found that insurance plan expenses decreased by $13,000 for rare disease and oncology patients, about $5,100 for patients with rheumatoid arthritis, and $2,600 for patients with cardiovascular disease under copay accumulator programs.
Thus, the popularity of these programs is explained: they allow insurers to pass along a higher portion of costs to patients and increase their profits. These programs ultimately negate the intended benefit of copay assistance and remove an important safety net for patients.
Fortunately, efforts are underway to reverse the implementation of these programs. Eighteen states and Puerto Rico have passed laws banning these programs to ensure that any discounts or payments made on behalf of a patient are applied to that patient’s out-of-pocket costs and cost-sharing requirements.
Federal legislation known as the Help Ensure Lower Patient Copays Act has also been introduced. It would require insurers and pharmacy benefit managers to count the value of copay assistance toward patient cost-sharing requirements.
This bipartisan legislation should be passed this year. Also, the Centers for Medicare and Medicaid Services should use its annual Notice of Benefit and Payment Parameters rule to prohibit or limit the use of these accumulator policies.
Patients cannot afford to shoulder more of the cost-sharing burden to access vital medical treatments. It is time for Congress to act to eliminate these harmful programs and bring much-needed relief to patients.