The dust has settled on the midterm elections, and we are back to an era of divided government. Healthcare continues to take center stage as many Americans struggle to afford prescription drugs, and efforts to increase patients’ access, improve accessibility, and lower the cost of prescriptions remain unresolved.
The current environment is a ripe opportunity for policymakers to focus on addressing a policy problem that both parties agree denies choice and raises patient costs. It is time to crack down on the behavior of Pharmacy Benefit Managers (PBMs), hidden middlemen working on behalf of insurers who have more say about which drugs you take and what they cost you than most patients realize.
These middlemen have developed complicated schemes to prevent patients from accessing the medicines their doctors recommend — including denying them the full benefit of any copay assistance vulnerable people rely on to afford their medications.
Many manufacturers provide financial copay assistance to patients with rare, life-threatening or complex chronic conditions, contributing $12 billion in 2021. PBMs, however, have developed schemes to pocket this assistance for themselves and their insurer clients without giving patients full credit. These programs are known as copay accumulators and copay maximizers, and they are sticking patients with a greater share of prescription drug costs and other costs related to their illness.
Copay accumulators are a scheme where copay assistance that would normally count toward a patient’s insurance plan’s deductible and the out-of-pocket maximum is prevented from doing so. Once the aid runs out, too often, patients cannot afford the sudden, high costs and will stop taking the vital medicine their doctors have prescribed. The likelihood that a plan includes a copay accumulator is fairly high — 43 percent in 2021 — up from 28 percent in 2018.
In a maximizer scheme, PBMs require patients to participate in the program to have their drugs covered. The maximum value of the manufacturer’s copay program is usually applied evenly throughout the year. While this may sound like it benefits patients, the scheme fails to count assistance toward deductibles or out-of-pocket maximums — forcing patients to come up with these costs that have risen dramatically. And anyone with a chronic illness knows that prescription drugs are not the only costs patients incur: Doctors’ visits, lab tests, medical equipment and occasionally hospital stays are all part of it. Not being able to apply copay assistance to their deductibles means patients have to foot more of the bills out of pocket for these services even as the plans rake in more money.
One would expect our federal agencies, tasked with protecting consumers, would step to the plate and regulate these schemes, but they have not. Unfortunately, the Centers for Medicare and Medicaid Services has allowed these accumulator and maximizer policies to flourish by permitting insurers to exclude copay assistance from cost-sharing calculations. In response, patient advocacy groups filed a lawsuit challenging a recent rule from CMS that permitted insurers to use copay accumulators, alleging the rule violates existing federal law and directly contradicts the government’s definition of cost-sharing.
Lawmakers at the federal and state levels have a renewed opportunity to do their part and prohibit PBMs and plans from implementing these schemes. Sixteen states have banned copay accumulators, but that affects only 10 percent of all commercially insured patients. The time for federal action is now to enact legislation introduced by a bipartisan group of lawmakers — the HELP Copays Act — which would reverse CMS’ rule allowing insurers to use these schemes.
It is time to stand up to PBMs lining their pockets at patients’ expense. If policymakers want to show they are serious about helping patients afford their prescription drugs, they need to overhaul the environment that has allowed PBMs and health plans to create a drug supply system to benefit themselves over patients.