Co-Pay Accumulators: Trends in 2020 & Beyond, PT. 2

June 19, 2020

Earlier this week Rick Fry highlighted notable trends in co-pay accumulators thus far in 2020. As this issue continues, the natural question being asked by nearly everyone that has any involvement with the topic is “what’s next?”

In this article, I’ll outline some specific areas of interest related to co-pay accumulators and maximizers heading into 2021.

Clarity of New Rule Driving More Plans to Implement

The 2020 Notice of Benefit and Payment Parameters caused uncertainty throughout the pharmaceutical industry, prompting CMS to issue a clarifying update late in the summer of 2019 after publishing the final rule earlier in the year. This undoubtedly caused some plans to refrain from incorporating accumulators in their 2020 benefit design, unsure of the potential compliance risks. The 2021 rule, however, grants plan sponsors wide flexibility to use these tactics, specifically, permitting them regardless of whether a drug has an available generic or not. This was one of the main points of ambiguity around the prior year’s provisions. This will likely drive many plans that were considering accumulators for 2020 (but did not implement them) to press forward knowing they now have firm regulatory ground on which to do so.

Economic Conditions Also Contributing to Increased Utilization

The COVID-19 pandemic threw an unexpected wrench into the future planning of almost every business. With economic recovery certain to take considerable time, many organizations will be looking for additional cost-saving opportunities in 2021. While employee health coverage may not seem at face value an ideal avenue to accomplish this, the use of maximizer designs in self-funded plans will likely see continued increases as a way for plan sponsors to shift costs to manufacturer programs. The entry into the market of additional niche companies that provide this type of service demonstrates the increased market appetite for solutions that can achieve the desired savings without creating a financial burden on the patient.

This is often done in partnership with PBMs, whose business model involves selling their services to employers while keeping a percentage of the annual savings as their administrative fee. Pharmaceutical manufacturers, as a result, are left to wrestle with the issue of sponsoring a generous co-pay offer, often necessary to keep pace in a competitive therapeutic class. The reality is that organizations are actively seeking to extract maximum dollars from these programs to reduce their prescription drug spend.

Coverage Shifts from Medical to Pharmacy Benefit to Enable Accumulator Use

Currently, co-pay accumulators are almost exclusively operated against drugs covered under the pharmacy benefit, due to the data reporting capability that allows them to be executed on a large scale. Because pharmacy claims, specifically coordination of benefit scenarios where a co-pay card is billed as a secondary payer, are adjudicated electronically pursuant to NCPDP D.0 processing standards, pharmacy benefit managers are able to obtain data on co-pay offer use through contractual requirements placed on participating pharmacies. An equally effective method does not exist for medical benefit co-pay programs due to the significant amount of manual claim processing involved. Mandating that PBMs require patients to disclose the use of manufacturer coupons for drugs covered under the medical benefit or face potential termination of coverage has been a topic of discussion for some time. This strategy would be also difficult to carry out due to the lack of a uniform and effective means of ensuring it was followed.

As a result, some plans have begun shifting certain drugs from the medical to the pharmacy benefit, requiring white bag dispensing to the site of care for those typically administered in an office setting. With a significant number of high-cost specialty products continuing to enter the market, this trend is certainly one to watch in the coming year.

I’ll be discussing these, and other considerations related to the future of co-pay accumulators and maximizers in a live webinar presented by World Congress on Monday, June 22 at 2 PM ET.  Please register here.

Rick Fry, Senior Vice President, Commercial Solutions

Jason Zemcik, Sr. Director of Product Management