Co-Pay Accumulators: Trends in 2020 & Beyond

June 18, 2020

Co-pay accumulators have become a fixture in the pharmaceutical patient support services landscape in recent years, as the ongoing tug-of-war between manufacturers and payers continues over who should bear the cost burden for specialty drugs.

This week my colleague Jason Zemcik and I will be discussing the current state of co-pay accumulators. We will also examine recent market developments and share our expectations for the rest of this year and 2021.

Today’s article will focus on notable observations around accumulators thus far in 2020.

 Continued Increase in Co-Pay Accumulator Utilization

With each passing year, co-pay accumulators and maximizers become more prevalent within health insurance benefit plan designs. Initially, there was some confusion due to ambiguous language contained in the CMS 2020 Notice of Benefit and Payment Parameters rule. However, this did not stop an increasing number of plan sponsors from incorporating co-pay accumulator adjustments into their 2020 benefit design. Across a sampling of over 30 co-pay assistance programs supporting 50+ specialty products, TrialCard has seen the percentage of patients impacted by accumulators and maximizers grow from 5.9% in 2018 to 7.0% in 2019. This number is expected to increase to 8.5% in 2020.

In addition, a recent Kaiser Health News article cited study data which found that 34% of large employers used co-pay accumulators in 2019, with an additional 4% of employers planning to incorporate them this year.  An additional 15% indicated they were considering implementing them in the next two years.

The Shift to More Maximizers

Co-pay maximizers have gained popularity among plan sponsors as a more “patient-friendly” alternative to traditional accumulator adjustments. While patients still do not receive credit toward their cost-sharing obligation, the benefit value of the manufacturer co-pay offer is captured in largely equal increments throughout the year (often 1/12 of the annual benefit maximum per month) under a maximizer. Because of this, patients are not left with the “co-pay surprise” scenario that often results late in the plan year once the annual maximum value of the co-pay offer has been exhausted.

Pharmaceutical manufacturers still feel the significant sting of these designs in their co-pay program reimbursement budget, but plans extract the maximum available funding from the program for as many patients as possible.  This trend is supported by co-pay program data for several individual brand programs and is a common theme throughout TrialCard’s entire patient affordability portfolio. As a result, a larger percentage of patients were negatively impacted during the first half of 2020, but at a lower amount of reimbursement spend per patient.

Slow Progress on State-Level Legislation

To date, four states (Arizona, Illinois, Virginia, and West Virginia) have passed laws prohibiting plan sponsors from incorporating accumulators. Each state’s legislation took effect on January 1, 2020, except for Arizona’s, which had an effective date of December 31, 2019. Despite the negative impact on patients and calls from numerous patient advocacy groups, no other states have passed legislation banning co-pay accumulators. Several states have proposed legislation like the four already enacted, but all bills are either currently pending or have stalled out at some point in the legislative process.

It is worth mentioning that state prohibitions apply only to fully insured plans. Self-funded plans, which account for 61% of covered workers in employer plans according to the 2019 Kaiser Family Foundation Employer Health Benefit Survey, are not subject to such state legislation. As a result, this is a helpful step but is far from a complete solution–even if additional states pass similar legislation.

In May 2020, the Centers for Medicare and Medicaid Services (CMS) published the 2021 Notice of Benefit and Payment Parameters rule, outlining the framework in which plans can operate accumulator and maximizer tactics in the coming year. In this series’ next installment, Jason Zemcik will examine what the future holds for patients and co-pay programs in light of this new rule and other market developments.

Please join TrialCard for a webinar on Monday, June 22, 2020, at 2:00 p.m. ET.  Zemcik will discuss the role that these new rules and emerging trends play in devising an effective co-pay accumulation strategy for 2021. Please register here.

Rick Fry, Senior Vice President, Commercial Solutions

Jason Zemcik, Sr. Director of Product Management