For chronic conditions such as hemophilia, high cost/high value treatments are without generic therapeutic alternatives. Members often rely on financial help to access life-saving treatments. Non-adherence is a concern, that for many, is directly related to the level of coinsurance or cost-share involved. For bleeding disorders specifically, cases have been documented where members are seeking treatment via the emergency room or other high cost infusion providers when they can’t afford to pay for their medications. This ultimately drives higher costs for payers and members. Considering that one bad bleed can lead to permanent debilitating joint damage or even death if a major organ or head bleed is involved, employers should ensure members have access to advocacy programs that provide education and support about hemophilia and management of finances.
Due to the rise in health care costs, some employers have implemented cost shifting strategies, such as high deductible health plans, co-insurance, copays and/or high-tiered placement for specialty drugs. This cost shifting can be especially concerning for members with hemophilia. For specialty medications such as clotting factor, significant costs can result from even one month of treatment. The deductible may be met almost immediately in the coverage year due to the cost of a single order of clotting factor. Members with hemophilia are responsible for substantial costs in a short time frame, as opposed to accruing more moderate costs over the course of the year as is typical for non-hemophilia members.
Specialty Copay Card Programs
While copay cards have some positive benefits for members such as improving access, affordability and compliance, many employers believe they can also increase costs by encouraging unnecessary use of higher-priced, branded drugs and some believe they circumvent the formulary. But for people with rare diseases like hemophilia, manufacturer copay cards are a mechanism to mitigate the cost burdens that come with ongoing treatment.
Two new specialty copay card programs were introduced in 2017 – accumulator adjustor and copay allowance maximization. Neither program typically allows a members’ copay assistance to count towards their deductibles or annual out-of-pocket maximum. When applied to high-cost/high-value drugs, these programs can create a barrier to members’ utilization of necessary and potentially life-saving therapies. In addition, they can reintroduce financial barriers to patient access and negate the benefits of copay assistance programs for those with a chronic/rare disease with no generic alternative.
Employers should consider whether these programs should be applied to life-threatening conditions with no alternative treatments. Employers who implement these programs as a one-size-fits-all option can expose themselves and members to a series of costly unintended consequences. For example, if a member cannot afford their out-of-pocket expenses, they are left with no option but to be non-adherent to their prescribed treatment to prevent bleeds, forcing them to be reactive and seek treatment in the highest cost of care setting, the emergency room.
Legislation has been proposed that would place a ban on copay accumulator adjustor programs and would require copayments paid in any form, including through a copay assistance program, to count towards an individual’s deductible or out-of-pocket maximum.
The Health and Human Services (HHS) Notice of Benefit and Payment Parameters (NBPP) final rule, beginning January 1, 2020, states that insurers may not implement these programs for specialty drugs which have no generics; and while they may implement the programs if there are generics, they can’t penalize patients if the generic is ineffective.
However, since the publication of that rule, the Department of Labor (DOL), HHS and the Treasury, have stated that the NBPP final rule and prior IRS guidance related to high deductible health plans (HDHPs) may conflict. Therefore, the Departments’ interpretation of how drug manufacturers’ coupons apply with respect to the annual limitation on cost sharing is ambiguous.
Until the 2021 NBPP is issued and effective, an issuer of group or individual health insurance coverage or a group health plan may exclude the value of drug manufacturers’ coupons from the annual limitation on cost sharing, including in circumstances in which there is no medically appropriate generic equivalent available, with no penalty by the Departments. States may adopt a similar enforcement policy, and HHS will not consider a state to be in violation of enforcing the annual limitation on cost sharing in cases where a state does so with respect to health insurance issuers.