Understanding Copay Accumulator Adjustment Programs

Copay accumulator adjustment programs are a relatively new concept in the healthcare industry, but they're becoming increasingly popular. These programs allow employers to offer more affordable health insurance options to their employees.

Here's how it works: the copay accumulator program allows employers to count the value of copays, coinsurance, and deductibles towards the out-of-pocket maximum, rather than just counting the copays. This can save employees a significant amount of money on their healthcare costs.

For example, let's say an employee has a $100 copay for a doctor's visit. Under a traditional plan, that copay would only count towards the out-of-pocket maximum. But with a copay accumulator program, the full $100 would be counted, plus any coinsurance or deductible payments the employee made. This can add up quickly, saving the employee a lot of money in the long run.

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Accumulator adjustment programs are designed to limit copay savings, but how do they work? They set a maximum amount of copay savings per year, which can be as low as $2,500 or as high as $10,000.

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These programs have been implemented by many insurance companies, including UnitedHealthcare and Cigna. They're often touted as a way to reduce healthcare costs, but critics argue they can leave patients with unexpected expenses.

The maximum out-of-pocket (MOOP) limit is the maximum amount a patient can pay for healthcare expenses per year, which can range from $7,000 to $14,000. This limit is often tied to accumulator adjustment programs.

Some patients may be exempt from accumulator adjustment programs, such as those with certain medical conditions or disabilities.

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Copay accumulator adjuster programs, or CAAPs, have become a common feature in commercial health plans, appearing in over 80% of them. They're a relatively new cost-containment tactic.

These programs can be sprung on consumers in the middle of a plan year, often hidden in lengthy plan documents. Plans might disguise them under confusing names like "out-of-pocket protection programs" or "specialty copay solutions."

A variation of CAAPs is called "copay maximizers", commonly found in self-funded health plans.

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CAAPs create significant confusion, financial risk, and barriers to care for consumers. Patients are forced to discontinue treatment or turn to emergency rooms for care of acute health episodes, leading to bad health outcomes and higher health care spending overall.

Patients exposed to sky-high, year-after-year out-of-pocket (OOP) costs face threats to their financial security as well as their physical well-being.

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For patients with complex, chronic conditions, co-pay assistance is vital. It offers them access to their necessary medical therapies at a reasonable rate.

Unfortunately, when copay assistance is excluded as an out-of-pocket expense, cost of care skyrockets. This can lead to patients having to choose between outrageous medical costs and discontinuing their successful treatment, resulting in adverse health effects.

Patients rely on copay assistance to help defray the out-of-pocket cost of their prescription drugs. This is especially true for those in the bleeding disorders community.

Cost of care skyrocketing can have serious consequences for patients. It's crucial that we understand the importance of copay assistance in maintaining their health and financial security.

Insurers have a responsibility to clearly notify patients of the existence of these programs in their insurance policy. This transparency is essential in helping patients make informed decisions about their care.

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CAAPs create significant confusion for consumers, leading to financial risk and barriers to care. Patients are forced to choose between discontinuing treatment or turning to emergency rooms for care of acute health episodes.

High out-of-pocket (OOP) costs can lead to bad health outcomes. These costs can also result in higher health care spending overall.

Patients exposed to sky-high, year-after-year OOP costs face threats to their financial security. This can have a devastating impact on their physical wellbeing.

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The Biden administration has not signaled that they will enforce the copay accumulator ruling, leaving a gap in enforcement.

States are stepping up to fill this enforcement gap by enacting legislation to regulate or prohibit copay accumulator programs.

As of June, 21 states have implemented copay accumulator bans with varying scopes and provisions.

Nevada announced at the end of May that it will enforce the Circuit Court's ruling in health plans in the state, mandating that plans not include accumulator policies beginning in 2025.

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HFA's Position is clear: all copays count. Lawmakers should protect patients from high out-of-pocket costs by requiring health plans to credit all payments made by or on behalf of patients toward patient deductibles and out-of-pocket maximums.

This means that every single copayment made by a patient should be counted toward reducing their deductible and out-of-pocket maximum. This is not just a matter of fairness, but also a matter of patient health and well-being.

Copayment accumulator adjusters are a major obstacle to this goal, and they endanger patient health and well-being by allowing health plans to exclude copays from counting toward deductibles and out-of-pocket maximums.

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CSRO is a member of the All Copays Count Coalition (ACCC), which advocates for state and federal legislation to ban accumulator adjustment programs. The coalition works to support legislation and has provided testimony to various committees from around the country.

CSRO members have also submitted letters of support through targeted grassroots campaigns that all members may access. This collaborative effort aims to raise awareness about the impact of copay accumulator programs on patients.

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In response to the D.C. Circuit Court ruling, CSRO continues to encourage states to follow Nevada's lead in enforcing the ruling. Nevada's Division of Insurance 2025 Health Benefit Plan Filing Guidance will mandate that plans not include accumulator policies beginning in 2025.

As of June, 21 states have implemented copay accumulator bans with varying scopes and provisions.

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If you have a copay accumulator adjustment program (CAAP) in place, it's essential to engage with your pharmacy benefit manager (PBM) or legal counsel to determine if your plan is impacted by recent copay accumulator laws.

If your group is impacted, you'll need to determine your approach for managing implementation of the legislation. This includes asking your PBM for an impact analysis, including estimated increase in plan cost and associated member impact.

You should also consider working with your PBM on communication plans, if any are determined to be needed, to ensure a smooth transition for your members.

If your group is not impacted, pharma manufacturers have developed emerging methods to push back on accumulator programs where they are still permitted. It's worth learning more about these approaches to understand how they will play into your pharmacy benefit strategy.

PBMs may use this legislation as an opportunity to promote additional alternative funding programs or copay maximizers. These programs are considered "non-essential" and therefore outside of the defined benefit plan.

Here are some questions to ask your PBM about copay maximizer programs: