Stealth Insurance Program

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A Period of Adjustment
A new insurance program can put patients at risk
by Larry Buhl

Introduced this year, a stealthy new program is leading to big surprises at the pharmacy for patients with expensive meds. It’s called the co-pay accumulator program, and it targets specialty drugs for which drug makers provide co-payment assistance and is catching customers off guard with whopping bills for their drugs.

Manufacturers’ co-pay coupons or vouchers could be considered free money, issued by the drug maker to the patient. The money goes toward the patient’s deductible, so that by the middle of the year or sooner, the out-of-pocket maximum would be reached and the plan would then cover the full cost of the prescription.

But in 2018 many insurers quietly launched benign-sounding co-pay accumulator programs to patients’ plans, making manufacturer coupons no longer count toward the patient’s deductible or maximum, which, in effect, renders them worthless.

To add insult on top of injury, insurance companies, though their middlemen, the Pharmacy Benefit Managers, or PBMs, are still collecting the money from the manufacturers’ coupons, even though they don’t count toward the patients’ deductible.

Not all insurers have introduced these plans. Kaiser Permanente, the giant California-based HMO, never accepted manufacturer co-pay cards, with the philosophy that the cards only drive up the cost of drugs. In a recent LA Times article, an insurance industry group said that coupons are simply a “marketing scheme leveraged by Big Pharma to keep drug costs high for everyone.”

A letter sent to all state insurance commissioners by the AIDS Institute and other HIV/AIDS organizations in May laid out the difficulties that co-pay accumulator programs put patients in. It read in part:

“Unaware of the change, many consumers find themselves reaching a ‘cost cliff’ mid-year. After hitting the maximum on their co-pay card assistance, they pick up their prescription only to discover that the co-pay card has not been counted toward the deductible and they now will owe over a thousand dollars per refill to continue their medication. This likely will cause dangerous treatment disruptions mid-year as medication becomes prohibitively expensive without warning.”

The co-pay accumulator programs affect any patients with very pricey medications, but they are a particular danger for those needing HIV meds, and those relying on PrEP.

“For people with HIV or on PrEP, this is how they access their meds,” Carl Schmid, Deputy Executive Director of the AIDS Institute, told A&U.

“People are being caught off guard, and the big problem we see is with PrEP, which isn’t covered by Ryan White. Some people have stopped medication because of this.”

Schmid said that co-pay accumulator programs are not only bad policy, they’re also stealthy.

“[Insurers are] not giving the patients proper knowledge of this. It’s in the small print in the plan contract. They thought their plans would be similar to last year and they didn’t expect the change. There’s a big lack of transparency.”

Eric Farmer, HIV Clinical Pharmacist at the LifeCare Clinic at Indiana University Health Methodist Hospital in Indianapolis, tells A&U that patients call his department in a panic when they find out that they suddenly have to pay thousands of dollars at the pharmacy.

“I call the pharmacist to make sure it was billed correctly, and it was. And come to find out it was co-pay accumulator. Then the patients are in a pickle. Most of the patients at our office are not able to pay that deductible. They have this benefit they’re paying for through the employer that they’re not able to use.”

Farmer says his department has some ways of helping these patients, but none of the options are very good. One tactic is applying for grant money to pay for the medicine through private companies, including the PAN Foundation and the Patient Advocate Foundation. He’s also encouraged some pharmacies to put patients on a payment plan.

The least desirable option, Farmer said, is changing the patient’s regimen, which is especially problematic for patients with HIV. “It’s extremely disruptive, and it’s not evidence based to change a regimen based on financial need. They may have side effects. And it’s not always an option because of interactions.”

The worst option to afford meds, one that Farmer doesn’t recommend, is stretching out the medication, which can increase the risk of viral load or resistance.

Farmer points out that the co-pay accumulator programs are just the latest blow in a health care system that, even under Obamacare, is still unaffordable for many.

“Some people are the working poor, for WalMart, barely above minimum wage, and they don’t have the $25 for their insulin, even with co-pay cards, and after they pay for their meds have fifteen dollars to get food for the week.”


Larry Buhl is a multimedia journalist, screenwriter, and novelist living in Los Angeles. Follow him on Twitter @LarryBuhl.