Accumulating Barriers to Care: Double Jeopardy for US Patients


Dan Leonard, Kimberly Westrich, and Brian Sils of the National Pharmaceutical Council examine how a new HHS ruling on how US patients pay for medicines could hurt them financially, exacerbating what is already a challenging time in the midst of the COVID-19 pandemic.


The pandemic has been a challenging time for patients, many of whom are struggling to get access to the care they need, may have lost their jobs and healthcare coverage, or are facing other unexpected situations. In the middle of these challenges, the US Department of Health and Human Services (HHS) released a rule aimed at how patients pay for medicines.[1] Instead of helping patients during a time of need, this rule could hurt them even more financially.


Before the pandemic, there was an increasing trend toward higher patient out-of-pocket costs for healthcare treatments and services, which can lead to reduced medication adherence, deteriorating health outcomes, and increased hospitalization.[2],[3],[4],[5] To reduce this growing cost burden for patients with limited financial resources, some biopharmaceutical manufacturers have been offering copay assistance for specific therapies, such as specialty products that are used to treat complex conditions like cancer, arthritis or blood disorders.


But the HHS rule, released in May, gave health plans broader discretion in deciding whether direct payment assistance from a biopharmaceutical company to a patient could count toward a patient’s annual deductible and out-of-pocket maximum. The rule has real consequences for patients, who could incur thousands of dollars in extra out-of-pocket costs.[6],[7]


According to HHS’s rationale, providing copay assistance could cause physicians and patients to “choose an expensive brand name medicine when a less expensive and equally effective generic or other alternative is available.” A closer look at the data on pharmaceutical formulary design and utilization management shows that HHS’s argument doesn’t hold up under closer scrutiny.


With formulary design, commercial insurers have typically applied the dollar amount of copay assistance to a patient’s annual deductible and out-of-pocket maximum, but that is changing. Many insurers now argue that copay assistance undermines their formulary design and are putting copay accumulator adjustment programs in place. These programs preclude the use of copay assistance from counting toward deductibles and out-of-pocket maximums.[8] Perversely, under these programs, the copay assistance accrues to the health plan rather than to the patient it was designed to assist.


The setup of these copay accumulator adjustment programs is often not transparent to patients, leaves them with unexpected expenses, and shifts costs typically paid by the health plan onto the patient. The use of copay accumulator adjustment programs has been shown to negatively impact patients’ adherence to medications and lead to treatment discontinuation part way through the year when the copay assistance limit is reached.[9] Because these policies have critical implications for patients’ access to healthcare, it is important that we examine the strength and veracity of the argument that copay assistance undermines benefit design.


When it comes to formulary utilization management, insurers use tools such as prior authorization (PA) and step therapy (ST) that require patients to meet certain criteria before the health plan provides reimbursement for certain medications. These criteria include practices such as trying a less costly medicine or meeting specific clinical characteristics. With PA and ST, access to medications is discouraged through financial and administrative burdens for the patient. The health plan only reimburses for these medications after the insurer has determined that that particular medicine is appropriate for the patient. By doing so, the patient is following the health plan’s utilization management protocol, not undermining it.


To illustrate how often high-cost specialty products with copay assistance are subject to this type of utilization management through PA or ST, we analyzed the top five anti-inflammatory specialty products by market share.[10] The anti-inflammatory therapeutic area was selected because it accounts for the greatest share of expenditures among commercial plans.[11] According to the analysis, these products were subject to PA and/or ST restrictions in 93 percent of plans that covered them under the pharmaceutical benefit. This ranged from a high of 95 percent for Enbrel, Humira and Stelara, to a low of 78 percent for Rituxan (Figure 1).


Made with Visme Infographic Maker


While these results only represent a single therapeutic area and may not be generalizable to all others, they do provide a snapshot for the top products in the therapeutic area with the greatest expenditures. The vast majority of commercial health plans included in the analysis already have restrictions in place for these specialty medicines, necessitating plan approval before the plan will provide any financial coverage for them.


Paying higher out-of-pocket costs for healthcare is an ongoing challenge for patients, and one that has been further exacerbated by economic losses due to the COVID-19 pandemic. Rather than implementing policies that risk patient financial harm, HHS should prioritize patients’ financial well-being through policies that lower patient cost-sharing and require plans to count copay assistance toward deductibles and out-of-pocket maximums. Further, HHS should continue to prioritize the implementation of polices that incentivize high-value patient care and provide flexibility to cover medications and health services for chronic diseases prior to meeting the plan deductible. In the midst of a pandemic, now is not the time to add a greater burden on patients.


Dan Leonard is President and Chief Executive Officer, Kimberly Westrich is Vice President of Health Services Research, and Brian Sils is a Research Associate at the National Pharmaceutical Council.



[1] United States, Department of Health and Human Services, Patient Protection and Affordable Care Act: HHS Notice of Benefit and Payment Parameters for 2021; Notice Requirement for Non-Federal Governmental Plans. May 14, 2020, 85 FR 29164. LINK

[2] Goldman DP, Joyce GF, Zheng Y. Prescription Drug Cost Sharing: Associations with Medication and Medical Utilization and Spending and Health. JAMA. 2007;298(1):61-69. doi:10.1001/jama.298.1.61

[3] Trivedi AN, Moloo H, Mor V. Increased Ambulatory Care Copayments and Hospitalizations Among the Elderly. N Engl J Med. 2010;362(4):320-328. doi:10.1056/NEJMsa0904533

[4] Chandra A, Gruber J, McKnight R. Patient Cost-Sharing and Hospitalization Offsets in the Elderly. Am Econ Rev. 2010;100(1):193-213. doi:10.1257/aer.100.1.193

[5] Gourzoulidis G, Kourlaba G, Stafylas P, Giamouzis G, Parissis J, Maniadakis N. Association between copayment, medication adherence and outcomes in the management of patients with diabetes and heart failure. Health Policy. 2017 Apr;121(4):363-377.

[6] United States, Department of Health and Human Services, Medicaid Program; Establishing Minimum Standards in Medicaid Stated Drug Utilization Review (DUR) and Supporting Value-Based Purchasing (VBP) for Drugs Covered in Medicaid, Revising Medicaid Drug Rebate and Third Party Liability (TPL) Requirements. June 19, 2020, 85 FR 37286. LINK

[7] National Organization for Rare Disorders, Copay Accumulator Programs. 2018. LINK

[8] Schmid, Carl E. II. New Accumulator Adjustment Programs Threaten Chronically Ill Patients. Health Affairs Blog. August 31, 2018. LINK.

[9] Sherman BW, Epstein AJ, Meissner B, Mittal M. Impact of a Co-pay Accumulator Adjustment Program on Specialty Drug Adherence. Am J Manag Care. 2019;25(7):335-340.

[10] The IQVIA Institute. Medicine Use and Spending in the US A Review of 2018 and Outlook to 2023. May 9, 2019. Pg. 51. LINK.

[11] Express Scripts. 2019 Drug Trend Report. LINK.

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