Two years after Court victory, patients still saddled with unaffordable drug costs

Government Must Clarify Copay Assistance Counts Towards Patient Cost-Sharing

Washington DC… Despite a major court victory nearing two years ago for patients’ ability to afford prescription drugs, the federal government has still not enforced the ruling by requiring insurers to count copay assistance towards patient cost-sharing. Although the Court gave the government the alternative to issue a new clarifying rule relating to drug manufacturer copay assistance and patient cost-sharing, no rule has been proposed two years after the government pledged to the Court and the public that it would.

On September 29, 2023, the U.S. District Court for the District of Columbia struck down a federal rule that had allowed health insurers to not count drug manufacturer copay assistance towards a beneficiary’s out-of-pocket costs. The case was brought against the U.S. Department of Health and Human Services by the HIV+Hepatitis Policy Institute, three patients, and two diabetes groups. 

The federal government’s inaction continues to allow insurers and PBMs to refuse to apply copay assistance towards patient cost-sharing obligations, keeping prescription drugs unaffordable for many people in the process. Insurers benefit from drug company copay assistance, and since that assistance is not being counted, patients are often forced to come up with thousands of dollars to meet their deductible and copays.

“For the sake of millions of patients who rely on copay assistance to afford their prescription drugs, it is long past time for the federal government to comply with the Court: either require insurers to comply with the current rule that allows copay assistance to count in most instances or issue a new cost-sharing rule,” said Carl Schmid, executive director of the HIV+Hepatitis Policy Institute. “We know President Trump wants to lower how much Americans pay for their drugs, especially compared to other nations, and requiring copay assistance to count will lower patients’ costs and reduce profiteering by drug middlemen.”

According to IQVIA, copay assistance totaled $21 billion in 2024. That represents billions and billions of dollars that patients did not have to pay out of their own pockets. However, insurers and middlemen are exploiting $7 billion of that money for schemes that don’t count copay assistance towards patient cost-sharing. Due to the government’s inaction, the use of “copay accumulator” programs is growing. In 2024 an estimated 43 percent of commercial insurers employed them.

Fortunately, patients are fighting back. Twenty-five states, the District of Columbia, and Puerto Rico have passed laws requiring insurers to count copay assistance towards patient cost-sharing. Two additional states, Nevada and Minnesota, have directed their insurers to comply with the Court order. However, since these laws only apply to state-regulated plans, a federal solution is needed. Bipartisan legislation to resolve these issues has been introduced in the U.S. Senate by Senators Roger Marshall (R-KS) and Tim Kaine (D-VA).

The Affordable Care Act defines cost-sharing as “deductibles, coinsurance, copayments, or similar charges; and any other expenditure required of an insured individual which is a qualified medical expense.”  It does not specify where that money comes from; it could be a friend, a family member, an employer, or a drug manufacturer.

Implementing regulations further state that cost-sharing is “any expenditure required by or on behalf of an enrollee with respect to essential health benefits . . . including deductibles, coinsurance, copayments, or similar charges.”  Due to the Court’s decision, although it is not being enforced, current regulations require insurers to apply copay assistance for brand name drugs that lack a generic equivalent. Any future clarifying rule issued by the federal government should uphold this principle.

All briefs and press releases related to the case, which was originally filed in August 2022, can be found here.

The expected rule would be issued by HHS and the Departments of Labor and Treasury.

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The HIV+Hepatitis Policy Institute is a national, non-profit organization whose mission is to promote quality and affordable healthcare for people living with or at risk of HIV, hepatitis, and other serious and chronic health conditions.