Insurance Loophole Causes Increased Financial Burden for Those With Chronic Conditions

Alyssa Dykstra has lived for years with autoimmune arthritis. It’s a chronic condition that causes painful joint swelling and there is no cure. She takes a TNF inhibitor that helps her manage her symptoms—but her insurer is using an increasingly common tactic to increase her prescription costs.

For years, Dykstra relied on copay coupons to afford her prescriptions. But her new insurance plan effectively refuses to accept them —forcing her to pay thousands of dollars out of pocket. And her husband's employer reports that it cannot offer Alyssa's family a single plan that would accept copay coupons.

Dykstra's experience isn't uncommon. Forty-three percent of Americans with commercial insurance plans are covered by companies that can refuse to count copay coupons or prescription drug rebates toward patients' deductibles or out-of-pocket maximums.

These scenarios threaten to ensnare a growing number of patients who need drug coupons to afford life-saving medicines.

A Federal Ruling Reduces the Value of Coupons

For years, pharmaceutical manufacturers have offered coupons to help patients with chronic conditions pay for their ongoing medication regimens. However a few years back, a Health and Human Services (HHS) ruling prompted insurance companies to widely adopt copay accumulator adjustment policies. Essentially, these policies restrict a manufacturer's assistance coupon from counting toward a patient's annual out-of-pocket maximums.

The specific language in the federal ruling says: “We are finalizing changes to the policy regarding whether drug manufacturer coupons must be applied towards the annual limitation on cost sharing. Specifically, we are revising § 156.130(h) to state that, to the extent consistent with applicable state law, amounts paid toward reducing the cost sharing incurred by an enrollee using any form of direct support offered by drug manufacturers for specific prescription drugs may be, but are not required to be, counted toward the annual limitation on cost sharing. However, we are not finalizing any change to the definition of cost sharing.”

This provides insurers with the ability to change their policy to disallow the coupons, thus leaving the costs to patients, who may not be able to afford their medications without the assistance. In some cases, the additional costs can be thousands of dollars.

Dykstra notes the specific wording, “but are not required to be.”

“This is the language when saying the argument from the government is that no one is making insurance companies do anything,” Dykstra said. “The law just allows it to happen or not happen, to which we argue why wouldn't a company do something that would make them more money?”

A Lifetime of Pain, And a New Payment Paradigm

Dykstra was diagnosed when she was 2 years old. She notes that although she didn’t have it as bad as other people she has had painful flare-ups. She recalls her mom soaking her feet in the sink on cold days because she was having trouble walking.

In her late 20s, she had disc replacement surgery and her joints were experiencing degeneration like osteoarthritis. This was surprising to her since she was not diagnosed with rheumatoid arthritis. “I thought I got the lucky part of the unlucky diagnosis for a while,” Dykstra explained.

Still, she is grateful that she has medication to help her through her condition. “I'm doing okay, and I'm managing because I have been able to have access to biologics.”

Previously, Dykstra explains that the pharmaceutical companies had collected the insurance portion and given patients a coupon to cover whatever patients are responsible for. However, the companies have a maximum for the year.

“So, if, unfortunately, your coverage did not get you through for the whole year—if it was very expensive—you would have some portion still, but typically, by that point, your deductible would be met, and it would be a smaller coinsurance or a copay,” Dykstra stated. “And it wouldn't be thousands [of dollars] at a time to hit the deductible value.”

However, the insurers have changed their expectations with the aforementioned copay accumulator adjustment policies.

“Insurance said, ‘you know, the money's not coming from you, it's coming from the company. We're actually not going to count your deductible, because we want it to come from your pocket.’ So, they're taking the coupons. And then they're not tracking anything that you've paid on your account,” Dykstra said. “Essentially, you're running through this assistance, which is supposed to help you from the manufacturer. Your numbers are not tracking on your portal or your account. And you are going to run out of that maximum allowed amount that they give you way earlier than you should.”

And this leaves Dykstra in a terrible bind. “Do I pay my mortgage or do I get my medication that keeps my bones from falling apart?”

Prospective Solution
Obviously this type of care scenario is not viable and can force people to miss their medication and/or be financially hurt. Unpaid or the inability to pay medical bills continues to be the most common reason people declare bankruptcy.

There is a prospective bill in Congress that looks to address this issue. The HR 830 Help Ensure Lower Patient (HELP) Copays Act was introduced in the House of Representatives in February of this year. “This bill requires health insurance plans to apply certain payments made by, or on behalf of, a plan enrollee toward a plan's cost-sharing requirements. Specifically, plans must apply third-party payments, financial assistance, discounts, product vouchers, and other reductions in out-of-pocket expenses toward the requirements,” says a summary of the bill on the Congress website.

For Dykstra, the waiting for Congress to act is especially difficult as each month she needs her medication and has out-of-pocket costs to consider. “There has not been a lot of progress on it from what I can tell,” Dykstra explained, speaking of the HELP act. “But that just means everyone can write into their representatives, or make a phone call, and just ask them to cosponsor HR 830.”