Policy Spotlight: Copay Accumulators

Ensuring All Copays Count

Living with lupus can be expensive, and prescription assistance programs help people with lupus lower the cost of their medications. Increasingly, insurance companies are using copay accumulator programs to prevent third-party cost assistance from counting towards the person's cost-sharing requirements, and the Foundation is actively advocating against these harmful policies at both the federal and state level.

The Lupus Foundation of America is dedicated to improving the lives of people with lupus. One of the many ways the Foundation accomplishes this is through advocating for state and federal policy that will help with access to quality healthcare and medication.

We know through our work with the lupus community that there are many barriers to accessing quality, comprehensive, affordable healthcare. In the last few years, insurance companies have implemented polices, called copay accumulators, that can further limit access to care and increase costs for people with lupus.

Living with lupus can be expensive as research has shown it can cost over $68,000 annually depending on the severity of the disease. Assistance programs are available to help people with lupus afford the costs of their care, including the cost of medications. These assistance programs can be offered by non-profit organizations, state government agencies, or pharmaceutical companies. While patient assistance programs can take many forms, under prescription drug assistance programs, a portion of a person’s drug cost is paid by a third-party entity – that is, not the person themselves and not the insurance company.

Simply put, a copay accumulator is a policy in which third-party assistance is not counted towards a patient’s annual cost-sharing requirements, including their deductible and out-of-pocket maximums. Often times, people are not aware that their insurance includes a copay accumulator until it impacts them at the pharmacy counter.

Copay Accumulators as Experienced by a Lupus Warrior

February

Stephanie’s doctor prescribes her a medication to treat her lupus and tells her that the manufacturer offers a patient assistance program that could significantly reduce the cost of the drug or even enable her to obtain it for free. Stephanie applies for assistance through the program and is approved – the manufacturer sends her a coupon that will lower her costs from $750 each month to $0 for up to 5 uses. She uses her coupon card to pick up her prescription that month.

March – June

Stephanie uses her coupon card to pay for her prescription at no cost to her. If the assistance program did not exist, she would owe $750 each month until she exits her deductible ($4,000) and her insurance kicks in to cover most of the cost of the drug.

July

Stephanie arrives at the pharmacy to pick up her medication – while she is no longer able to use the coupon card because she has already used it five times, she knows the the coupon covered $3,750 of her costs, and she will only owe the remaining $250 to satisfy her $4,000 deductible and an additional small copay. The pharmacist rings her up and tells her that she owes $750.

At the pharmacy counter, Stephanie learns that because her insurance plan has a copay accumulator, her coupon card payments did not count towards her deductible. That means she needs to continue to pay $750 out of pocket over the coming months until her $4,000 deductible is met. Because of the copay accumulator, the insurance company will collect $7,750 on behalf of Stephanie – $4,000 out of her pocket, and $3,750 via the assistance program.

Stephanie, having planned and budgeted to make the $250 payment she was expecting, now cannot afford her medication. She leaves the pharmacy unable to fill her prescription and will begin missing doses that could jeopardize her health.

This is the story for many patients. They are unaware their insurance plan has a copay accumulator policy in place until they have used up their copay coupon card and have realized their deductible has not been lowered. This is especially harmful for people with lupus who are on several medications at the same time, and a delay or not taking a medication at all could be detrimental to their health.

How Copay Accumulators Harm Patients

Unexpected Expenses. Copay accumulator policies are typically only communicated to the plan’s beneficiaries via their explanation of benefits (EOB), which are documents that can be long, technical, and challenging to read. Because of this, many people who access patient assistance programs don’t realize this assistance does not reduce or eliminate their out-of-pocket cost sharing requirements. They only learn of the copay accumulator when they have reached the limit of their patient assistance and are told that they still must pay the deductible and other cost-sharing requirements out-of-pocket. These unexpected expenses can force patients to leave their prescriptions at the pharmacy counter and not take the medications they need.
Patient Choice. Copay accumulators were designed by insurance companies, in part, to discourage patients from using more expensive medications – even if those medications are recommended by their physicians as medically necessary. By preventing assistance programs from reducing patient cost-sharing, copay accumulators inappropriately limit patient choice and drive patients to take medications preferred by their insurance plan, rather than the medications recommended by their physician and for which an assistance program is available. While assistance programs help to remove cost as a barrier and give patients more choices, copay accumulators limit choice and force patients to make medical decisions based on cost rather than on what’s in the best interest of their heath.

Policy Outlook

Fourteen states and Puerto Rico have already have banned the use of copay accumulators including: Arizona, Arkansas, Connecticut, Georgia, Illinois, Kentucky, Louisiana, Maine, North Carolina, Oklahoma, Tennessee, Virginia, Washington, and West Virginia. Many more are considering implementing copay accumulator bans as soon as this year.

The Foundation is helping to lead the fight against copay accumulators, including as members of the All Copays Count Coalition and the State Access to Innovative Medicines Coalition. We are bringing the lupus perspective to these coalitions which include organizations from across the country representing other diseases who share our commitment to ending copay accumulators and other policies that limit patient access to care.

As the fight against copay accumulators continues to ramp up at both the state and federal level, we'll need the voices of lupus advocates to tell their stories and advocate in support of banning these harmful policies. To join the fight, sign up as an advocate today!