I’d venture to guess that none of my fellow pharmacists has ever heard a customer happily pay a co-payment for a prescription drug. But many patients might yearn for a simple co-payment compared to what they often face more today: large co-insurance obligations and high deductibles.

John O’Brien

Over the past decade, insurance companies have increasingly changed their patient cost-sharing model to move away from simple co-pays to one in which patient purchasing is subject to deductibles or co-insurance. This means a much higher out-of-pocket burden, one made even more significant when the patient’s payment obligation is calculated based on a medicine’s list price, not one that the insurance company negotiates.

The impact is felt on more than the patient’s wallet. It is bad not only for the health care system overall, but most importantly for patient health. Multiple studies have shown that when co-payments and out-of-pocket costs go up, medication adherence goes down, and disease control and hospitalizations get worse.

This especially impacts communities of color, who are already disproportionately impacted by certain chronic diseases for many reasons, including access to affordable health care and other social determinants of health.

Proponents of increased cost-sharing suggest that it gives patients an incentive to choose wisely, but that’s not the way the health care system works, and it’s certainly not the way it should work. Adding burdens to those with chronic diseases doesn’t incentivize better treatment. It incentivizes no treatment.

This is why The New York Times called deductibles “ridiculous” and why Vanderbilt’s Stacie Dutsetzina and her colleagues wrote last year in JAMA Health Forum that “cost sharing for these [chronic] medications simply adds a compounding economic barrier.”

It’s critical to understand that some higher-cost medicines stave off much more expensive conditions and diseases, and it makes little sense to pile extra out-of-pocket costs onto patients with those conditions.

To make matters worse, many insurers have recently begun blocking — essentially capturing for themselves — the co-payment assistance that pharmaceutical companies offer to help patients get the medicines they need. These programs are called “co-pay maximizers” and “co-pay accumulators.”

New data out from Adam Fein’s Drug Channels showed that, as of 2022, the co-pay maximizers are available in 76% of commercial plans and implemented in 41% of plans. That’s up from 23% of plans in 2020. Accumulators have been implemented in 39% of insurance plans.

Insurers are not exactly making themselves popular with these moves. Already, 16 states bar accumulators/maximizers, and more efforts are under way.

It’s not difficult to see why legislators want to limit the use of these assistance-destroying programs, because it’s hard to imagine anything more patient-unfriendly than taking away something that directly helps people afford their medicines.

Co-pay assistance makes a real difference, sometimes dramatically so, in helping people with rising out-of-pocket expenses forced on them by their insurance plan, according to a recent IQVIA report sponsored by PhRMA (Pharmaceutical Research and Manufacturers of America).

This report looked at the impact of co-pays, co-insurance and deductibles on patient out-of-pocket spending in six therapeutic areas, and in each of those areas, out-of-pocket spending is at least four times higher in deductible/co-insurance plans than it is in plans with co-pays.

For example, it found that people with HIV face an annual out-of-pocket bill of more than $2,000 when their insurance includes a pharmacy deductible or co-insurance, while those with a benefit design based just on co-pays shell out nearly 10 times less.

When patients can get co-pay assistance, however, they save a lot. Patients with HIV who use co-pay cards save nearly $1,800, and patients battling cancer see a similar level of savings. Those with depression, diabetes or those who take anticoagulants or respiratory medicines all saved hundreds over what they would have paid if they were subject to the cost-sharing approach of their insurance company.

People in these plans also have little insight into how PBMs apply the co-pay programs and how it impacts costs. The federal government should require additional transparency in order to properly inform consumers prior to enrolling in a plan and to help patients understand how manufacturer assistance will be treated.

Instead of piling charge upon charge upon charge for the patient, insurers and pharmacy benefit managers ought to be working with the pharmaceutical industry on insurance plans that encourage high-value care, the kind of care that reduces the burden of disease for everyone.

Through research NPC has participated in and sponsored, we’ve shown that making certain chronic disease treatments eligible “pre-deductible” in high-deductible health plans could actually save money. And we’ve also shown that a consensus could be built among payers, patients and providers to make cost-sharing based on medical appropriateness, rather than the arbitrary placement of medicine on a particular formulary tier.

Everyone at the proverbial table wants to encourage the efficient use of every health care dollar. Burt when pharmacy benefit manager and insurance plan policies deter adherence to medicines people need, unintended consequences occur. We can do better, and for the sake of individual patient health and the health of the overall system, we must.

John O’Brien is president and chief executive officer of the National Pharmaceutical Council and a nonresident senior fellow at the Leonard D. Schaeffer Center for Health Policy and Economics at the University of Southern California.