Copay Accumulators, Explained: What Patients Need To Know

December 11, 2020

Millions of patients across the country depend on copay assistance programs to afford the medications that they need to survive. Copay assistance programs are provided by drug manufacturers to help lower the out-of-pocket cost of expensive prescription medications. These programs help patients purchase medication(s) that, in some cases, they otherwise would not be able to afford. Unfortunately, copay assistance programs are currently under threat from what insurance companies and pharmacy benefit managers (PBMs) call “copay accumulators.”

What are copay accumulators and how do they work?

Copay accumulators prohibit all copay payments made by the drug manufacturer from counting toward the patient’s out-of-pocket maximum or deductible. This means patients that need to use copay assistance programs will end up having to spend more money to reach their deductible. Additionally, copay accumulators increase the out-of-pocket costs for financially vulnerable patients, making it harder for them to adhere to their treatment plans and have beneficial health outcomes.

Here’s an example:

You have a health plan with a $2,000 deductible, and you need a monthly supply of a medication that costs $1,000 a month. To help make the medication more affordable, the manufacturer of the medication offers copay assistance coupons that reduce the cost to $20 a month, instead of the full price of $1,000. You pick up your medication in January and February, paying $20 each month.

In March, you reach the limit on your copay assistance, and go to pick up your medication. If your plan does not implement a copay accumulator, you pay $0 at the pharmacy because the full cost of the medication counts toward your deductible.

 

Month	Remaining deductible at the beginning of the month	Out-of-pocket cost of your medication
March	$2000 – $1000 – $1000 = $0   The full price of the medication in January ($1,000) and February ($1,000) counts toward the deductible ($2,000)	$0   Insurance covers the cost of your medication because you have met your deductible
April	$0	$0

 

If your plan does implement a copay accumulator, the copay assistance coupons won’t count toward your deductible, so you’re on the hook for the full $1,000 price this month, and would still owe $960 dollars next month.

 

 

Month	Remaining deductible at the beginning of the month	Out-of-pocket cost of your medication
March	$2000 – $20 – $20 = $1960   Copay assistance is excluded from counting toward the deductible. Now, after your out-of-pocket costs from January ($20) and February ($20) are subtracted from the total deductible ($2000), you still have $1960 to pay off.	$1000   You must pay the full cost of medication because your deductible has not been met
April	$1960 – $1000 = $960   After March’s out-of-pocket cost ($1000) has been subtracted, you still have to pay $960 before insurance covers medication costs	$960

 

In this example, copay accumulators cost you $1,960 in additional out-of-pocket costs, because they drag out the time it takes for you to meet your deductible.

 

	Without Copay Accumulators	With Copay Accumulators	Difference
Your Total Out-of-Pocket Cost	$40 ($20 in Jan, $20 in Feb)	$2000	-$1960

 

If you’re a patient that’s been affected by copay accumulators, here’s what you can do:

• Consult your health plan or call your insurer to ask questions. If you’re having trouble affording your medication, speak with experts to determine if patient assistance programs are offered by the pharmaceutical manufacturer.
• Tell your employer. They may have adopted this program thinking of it as a cost-savings strategy without truly understanding the negative impact it could have on their employees.
• Email us! My Patient Rights is here to help, and we want to hear your story. Contact us at info@mypatientrights.org.

Dive Deeper into Copay Accumulator Policies:

Two federal copay accumulator policies in particular threaten patient access to medication: the 2021 Notice of Benefits and Payment Parameters and a proposed rule for Medicaid Services (CMS). Patient advocacy groups across the nation are fighting against these harmful policies. If you would like to learn more about these policies, please visit the California Chronic Care Coalition for more information.