Discriminatory Copay Policies Report

Introduction

Patients with rare, complex, or chronic diseases such as HIV and viral hepatitis often need high-cost medications to manage their conditions and maintain their health. For many of these medications, there is no generic or less expensive alternative. Over the past decade, insurance companies and pharmacy benefit managers (PBMs) have increasingly required patients with chronic illness to bear more of the cost of their care through higher deductibles and copayments (the amounts that people with health insurance have to pay when they get health care). For many people with chronic illness, these amounts have become too high to afford the medications they need, even when they have insurance.

As a result, many patients with such diseases – including those with health insurance – must rely on financial assistance from charitable foundations and drug manufacturers. These copay assistance programs play a crucial role helping patients who rely on expensive medications meet those cost-sharing obligations and afford the medication they need to treat their condition. These programs provide a true financial lifeline for many people living with chronic conditions.

However, insurance companies and PBMs are increasingly undermining this assistance by
not counting the amount of money covered by manufacturer copay assistance programs toward enrollees’ annual deductibles and out- of-pocket limit. Instead, they keep the copay assistance funds used, and make enrollees keep paying. This little-known practice is called a “copay accumulator adjustment policy” or “CAAP.” These policies contribute to insurance company and PBM profits while shifting the cost of expensive prescription drugs to the patients who most rely on them, and the policies have become more common in recent years.

Unfortunately, the federal government has allowed copay accumulator adjustment policies to flourish, despite outcries from patients struggling to afford the prescription drugs they need to
get and stay healthy. A rule finalized in the last year of the Trump administration allows health insurance companies and PBMs to use copay accumulator adjustment policies at their discretion, even where there is no medically appropriate generic drug available. Despite President Biden’s Executive Order directing the Department of Health and Human Services (HHS) to review policies that could pose barriers to health care, HHS has not yet reversed that decision.