Patient Out-of-Pocket Expenses
For patients with chronic diseases like bleeding disorders, out-of-pocket expenses for prescription drugs are a significant problem. The average annual cost of treatment for a person with hemophilia is $300,000. Medical expenses for a person with severe hemophilia, the most common form of hemophilia, can be twice that. A person with an inhibitor (an immune response to replacement clotting factor) usually has expenses over a million dollars a year.
The treatment needs of a person with a bleeding disorder don’t vary during the year. Patients need access to replacement clotting factor or other non-factor therapy year round. Even the “average” hemophilia patient incurs tens of thousands of dollars of expenses monthly.
NHF is a member of the SAIM Coalition, which advocates for state legislation to ease the burden of high prescription drug costs on patients. From the SAIM web site:
“To help address the rising cost of healthcare and prescription drugs, many insurers are implementing plans that shift more of the cost to patients. For example, these cost-sharing approaches include high deductibles that patients must meet before their healthcare or medications are fully covered and coinsurance, in which patients must pay a percentage of total costs rather than a set copay. High deductibles and coinsurance are difficult to avoid when shopping for a health plan, as these cost-sharing techniques are a standard feature of plans available today.”
“Although cost-sharing approaches can be costly for any patient, plans with high deductibles and coinsurance are particularly burdensome for patients with chronic diseases who require specialized care and medication for months or years at a time.”
“These patients are likely to have to pay their full deductible every year, often within a relatively short timeframe. Even after they have met their deductible, they are required to pay a percentage of prescription drug costs, which are costly for the specialty tier medications used for many chronic diseases.”
“Coinsurance requirements also make it difficult to budget for their health expenses each year because they must pay a percentage of their overall healthcare costs rather than just a deductible and set copays.”
“The SAIM Coalition works to limit the burden of out-of-pocket by advocating for laws and regulations that require insurers to offer copay only cost-sharing insurance products in which the copays are proportionate to formulary tiers.”
In 2020 New Jersey enacted a SAIM-supported bill, capping a five-year effort in that state. Patient-friendly legislation in Illinois and Ohio did not advance.
Copay Accumulator Adjustment Programs
In response to regular increases in healthcare costs payers, especially self-insured plans, began shifting more of those costs to patients through high-deductible plans, higher coinsurance rates, placing specialty drugs on higher cost sharing tiers, and implementing copay accumulator adjustment programs (CAAPs). In response to these cost shifting trends, pharmaceutical manufacturers began to offer copay assistance programs for many life-saving specialty medications.
Manufacturer copay assistance cards have positive benefits for patients (improves access, affordability, and compliance). However, an increasing number of health insurance plan sponsors believe they drive prescription drug costs up by assisting beneficiaries in satisfying part or all of their personal out-of-pocket (OOP) costs.
CAAPs target manufacturer copay assistance programs available for specialty drugs by no longer allowing them to count towards a member’s accumulator, believing that manufacturers use them to steer patients to more expensive drugs, rather than lower-cost generic equivalents.
Their contention is that if a patient has little to no personal share of the costs, they would have no incentive to consider generic alternatives, formulary, or preferred drugs and would likely not think twice about getting unnecessary tests, procedures, and labs.
CAAPs may actually result in higher costs to the payer when rolled out as a one-size-fits-all solution. This one-size-fits-all approach is short-sighted when applying the same ideology to life-saving specialty medications that have no generic alternative.
CAAPs interfere with a vital lifeline for patients with chronic conditions necessitating specialty drugs that have no low-cost generic alternative. They negate the benefits of copay assistance programs for those with a chronic/rare disease with no generic alternatives and reintroduce financial barriers to access.
Increasing patient cost sharing has a direct correlation with decreased adherence. For those with rare diseases such as hemophilia, whose total cost of care exceeds the six-figure range annually, >85% of which is attributed to the prophylactic use of replacement clotting factors with no generic alternatives, non-adherence will almost always produce unintended consequences (i.e., increased ER visits, joint bleeds/damage, missed workdays, etc.), and result in much higher costs to the payer than the perceived ‘savings’ from this cost sharing shift.
CMS’ 2021 Notice of Benefit and Payment Parameters Rule allows health insurers to exclude manufacturer copay assistance from a patient’s annual out of pocket maximum. NHF submitted comments to CMS opposing this change in policy.
For patients with complex, chronic conditions like hemophilia, finding the right specialty drug treatment can be a long and difficult journey. A large percentage of patients with hemophilia are vulnerable and therefore rely on copay assistance programs to mitigate the cost sharing obstacles from enabling them to access their life and death treatments. This assistance may come from a manufacturer copay discount card or a nonprofit organization that offers financial assistance to patients.
Payers argue that copay assistance masks the true cost of prescription drugs and incentivize patients to use higher cost brand name drugs rather than lower cost generics. In addition to the utilization of accumulator adjuster programs payers have advocated for outright copay assistance bans in state legislatures.
In recent years legislation banning the use of third-party copay assistance has been introduced in some states, including New Hampshire and California. NHF has assisted chapters where necessary to oppose such legislation. In 2017 the New England Bleeding Disorders Advocacy Coalition successfully turned back an attempt to move a copay assistance ban bill in the New Hampshire state legislature.
Copay assistance bans remain a top priority for NHF’s state policy advocacy program. We work with chapters to monitor these bills and act where necessary