In a significant win for patients who rely on specialty medications with high out-of-pocket costs, the Centers for Medicare and Medicaid Services (CMS) has issued a regulation banning the use of co-pay accumulator programs when no generic alternatives are available.
Implemented by health insurance plans, co-pay accumulator programs prevent patients from using co-pay assistance from drug manufacturers to count toward their annual deductibles and out-of-pocket drug costs, resulting in a much larger financial burden for their medications.
Importantly, the CMS rule allows drug manufacturer coupons for brand name medications to count toward the patient’s deductible and annual out-of-pocket cost limit when there is no generic equivalent.
“Co-pay accumulator programs lead to greater out-of-pocket costs for individuals with life-threatening, chronic and rare diseases,” says President and CEO Dan Klein. “In situations where there are no generic alternatives, many patients need manufacturer coupons to help pay for their deductibles, co-pays and coinsurance. Otherwise, these patients would be unable to obtain their critical medications without having to make devastating financial trade-offs.”
While not a total prohibition of these programs, the CMS rule is an important move to ensure that economically vulnerable patients can get access to life-saving specialty medications, many of which have no generic alternatives. According to the regulation, health insurers can still implement co-pay accumulator programs for brand name medications when generic options are available.
Since deductibles and coinsurance have increased dramatically in recent years, all forms of patient assistance—including coupons from drug manufacturers—have become lifelines for underinsured patients. Between 2006 and 2016, deductibles for commercial insurance grew by approximately 300 percent—increasing to an average of $1,200, and far outpacing wage growth.
There has also been a marked increase in the proportion of employees enrolled in high-deductible health plans. In 2006, only 11.4 percent were enrolled in high-deductible plans. By 2016, that number had grown to include 46.5 percent of employees.
Several states, including Arizona, Virginia and West Virginia, have recently passed legislation that requires co-pay assistance from drug manufacturers to count toward the annual cost-sharing limit for all prescription drugs, regardless if a generic option is available.
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