Yesterday, PhRMA submitted comments on the Department of Health & Human Services’ (HHS) 2021 Notice of Benefit and Payment Parameters proposed rule. The proposed rule would hurt patients’ ability to have manufacturer copay coupons count toward their deductibles and out-of-pocket maximums. HHS should not finalize this misguided policy.
In recent years, medicine prices and spending have grown less than the rate of inflation, but patients with a deductible have seen their out-of-pocket costs increase 50%. Further, use of coinsurance – which can expose patients to larger and less predictable out-of-pocket costs – is becoming more common for specialty medicines. Biopharmaceutical companies offer copay coupons for some medicines to help many commercially insured patients afford their out-of-pocket costs, but insurers and pharmacy benefit managers (PBMs) increasingly use accumulator adjustment programs to block these coupons from being applied to deductibles and out-of-pocket maximums. These programs can result in patients facing thousands of dollars in unexpected costs, and, unfortunately, many patients may leave the pharmacy empty-handed.
Here are excerpts from key sections of our comments:
Cost-sharing assistance helps patients afford their out-of-pocket costs at the pharmacy counter.
- “In addition to increasing deductibles, plans increasingly rely more heavily on coinsurance than copays, which impairs out-of-pocket spending predictability for patients …. Cost-sharing assistance is an important protection for patients to access prescribed medications that both prescribers and plans agree is appropriate.”
- “Multiple studies report that manufacturer cost-sharing assistance is associated with higher adherence and lower rates of therapy discontinuation. For patients at risk of prescription drug abandonment due to high cost sharing, another study found that cost-sharing assistance programs typically reduced patients’ monthly out-of-pocket costs to a level where they were much less likely to abandon therapy.”
Accumulator adjustment programs put patients at risk
- “Ignoring the harms to patient adherence and well-being, health plans and PBMs have begun instituting accumulator adjustment programs, under which patients are penalized for using cost-sharing assistance by means of the plans not counting such assistance toward the patient’s deductible or annual limitation on cost sharing.”
- “These programs can leave patients with thousands of dollars in unexpected costs at the pharmacy, when a patients’ cost-sharing assistance for the year is exhausted, for example, resulting in exactly the problems that cost-sharing assistance is designed to solve: prescription abandonment, poor health outcomes, and unnecessary medical spending.”
HHS fails to explain or even acknowledge its reversal of its interpretation of “cost sharing”
- “The proposed rule is arbitrary and capricious because it is based on an interpretation of the statutory definition of ‘cost-sharing’ that is diametrically opposed to HHS’s prior regulatory interpretation of this term, and HHS has failed to acknowledge, much less explain the basis for this shift, as principles of administrative law require HHS to do.”
- “The existing HHS regulation defines ‘cost-sharing’ as ‘any expenditure required by or on behalf of an enrollee with respect to essential health benefits; such term includes deductibles, coinsurance, copayments, or similar charges, but excludes premiums, balance billing amounts for non-network providers, and spending for non-covered services.’ This definition makes explicit the meaning of the statute…. A third-party payment of amounts incurred by or charged to the enrollee do not cause those amounts to no longer be ‘cost-sharing.’”
HHS lacks any reasonable justification for its proposed rule
- “The only rationale HHS provides for this proposal is its belated discovery that the rule it finalized last year ‘could create a conflict’ with 2004 guidance from the IRS regarding the conditions under which a participant in an HDHP would be permitted to contribute to an HSA, and that health insurance issuers and sponsors of group health plans ‘potentially’ might not be able to comply with both last year’s final rule and the 2004 IRS guidance. We disagree.”
The proposed rule is inconsistent with the Administration’s health policy objectives.
- “The proposed rule is inconsistent with President Trump’s own stated objectives—and Executive Orders—for his Administration’s health care policy. In its “American Patients First” drug pricing policy blueprint, the Trump Administration expressed the goal of improving patient drug adherence by lowering out-of-pocket spending.… The proposed rule, by contrast, would use an IRS notice, promulgated by a prior administration, and never before used to address cost sharing, to reverse these important patient protections.”
- “But the proposed rule does worse than merely roll back the protections established last year. Although the proposed rule claims that it would permit issuers and plans to have ‘flexibility’ and determine whether to include or exclude manufacturer cost-sharing assistance from the annual limitation on cost sharing and to ‘continue longstanding practices’ in this regard, it could actually coerce high-deductible health plans to apply accumulator adjustment programs.”
Read the full comments here.
Topics: Access, Drug Cost, Health Insurance, Out-of-Pocket Costs, Pharmacy Benefit Managers, Let's Talk About Cost