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    Copay assistance programs: Managed care pros and cons


    Consumer-driven benefits

    With the emergence of consumer-driven pharmacy benefit designs however, which encompass components such as coinsurance and high deductibles, today’s insured members are finding themselves footing a much larger portion of the tab for the price of prescription medications. And, with highly prevalent chronic conditions such as arthritis, multiple sclerosis, and various cancers, expensive biologic therapies costing thousands of dollars per month are largely now the mainstay of treatment. In these instances, copay assistance programs have often become the only way for many of these individuals to afford the out-of-pocket costs tied to these therapies.


    “[Copay assistance programs] are standard practice in the pharmaceutical industry for new drugs,” says David H. Howard, department of health policy and management, Emory University, Atlanta. “Many programs for high-cost specialty drugs offer very generous assistance to privately-insured patients. Many specialty drugs have prices that exceed patients’ out-of-pocket maximums, so I don’t know that copay assistance programs really affect the price in those cases. But for drugs with lower prices and patients in plans without out-of-pocket maximums, patients may be exposed to the full price of the drug. Consequently, fewer may use it. Copay assistance programs diminish the tradeoff companies face between setting a higher price and selling more product.”

    These programs reduce the ability of insurers and PBMs to use cost sharing to steer patients to preferred drugs, according to Howard.

    David Weingard, CEO of Fit4D, a patient-centered digital technology diabetes coaching platform, agrees. “Programs removing the cost focus from patients when deciding on therapy can lead them and the prescriber to choose more expensive and newer therapies, he says. “Managed care design formularies with higher copays and cost sharing for patients to control use of these more expensive therapies, but the copay programs counteract this design. It’s a complicated topic, as programs do want to help patients but it is sometimes at odds with cost control strategies.” 

    Economic justification

    In a recent perspective piece by Howard published in the NEJM, he discussed the economic reasons for the existence of these programs. “They allow drug companies to charge higher prices, offer PR benefits, and increase demand for the drug,” Howard says.

    “Because copay assistance programs operate outside of the claims system, executives have no way of knowing whether their patients are receiving assistance,” he says. “Some executives have tried to penalize companies that offer generous assistance by moving their drugs to higher copay tiers. They will have to lean more heavily on non-financial tools, like step therapy.” 

    At the end of the day, the most important outcome is that a patient is taking their medication as prescribed, according to Weingard. “Barriers to adherence can be very complex, ranging from financial issues, side effects, nutrition/lifestyle and psychosocial issues. The certified diabetes educators who work at our company are helping to uncover what these barriers are for the people with diabetes we support every day. Often when the barriers are financial, copay cards can be very helpful in improving adherence.”

    Next: Making the right choice



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