The Trump administration has vowed to end HIV and lower drug prices, but two policies proposed by the Department Health and Human Services (HHS) could have just the opposite effect, especially for people who need HIV medication or pre-exposure prophylaxis (PrEP).
HIV advocates are sounding the alarm about a policy that disallows manufacturers’ rebates, or coupons, to count toward customers’ out-of-pocket costs, as well as another policy that weakens a non-discrimination clause in the Affordable Care Act. Advocates say these policies could increase what people pay for HIV medications.
Drug manufacturers’ copay rebates or coupons are issued to the patient to lower the cost of some of the most expensive drugs. The money had been applied to deductibles, so that sometime during the year, the out-of-pocket maximum would be reached. In 2018, some insurers quietly launched copay accumulator adjustment programs, which allow an insurance middleman, the pharmacy benefit manager (PBM), to not apply those coupons to a customer’s deductible or out-of-pocket maximum. This doesn’t render the coupons worthless. Customers can still use them to get cheaper drugs—but they will continue to pay out of pocket for much longer than they might expect.
In April 2019, the Centers for Medicare and Medicaid Services (CMS), a division of HHS, released a new policy (called the Notice of Benefit and Payment Parameters, or NBPP) effectively prohibiting copay accumulator adjustment programs in most circumstances. In August, the same year, CMS reversed this policy when it released an FAQ referencing a guidance document issued in 2004 by the IRS, which specified that copay coupons must be excluded from the calculation of an enrollee’s deductible in all instances. Essentially, this means CMS has not been enforcing its original provision to allow manufacturers’ coupons to count toward enrollees’ out-of-pocket expenses for this year.
After a comment period that ends March 2, 2020, CMS will issue a 2021 NBPP sometime this spring, and it’s not clear what the determination on copay coupons will be. HIV advocates, as well as health care advocates generally, are worried.
Copay accumulator adjustment programs affect all patients who require specialty meds, but they could especially wreak havoc on those who need HIV medication or PrEP, according to Michael Shankle, M.P.H., senior director of advocacy at HealthHIV.
“We want patients to access meds, and this rule change, if it goes through, will guarantee that many people, especially those on HIV treatment, will stop taking their meds,” he said. “And that would cause many people’s viral load to rise and could cause the meds to become ineffective if they restart treatment.”
Rachel Klein, deputy executive director of The AIDS Institute, said that CMS’s reversal doesn’t benefit anyone except the insurer or the pharmacy benefit managers. “This policy punishes patients,” she said. “Customers using coupons to pay for pricey meds will get a shock when they learn that the free money no longer counts toward their out-of-pocket maximums. That policy is buried in the fine print.”
The use of drug rebates has been under discussion for some time, and HHS Secretary Alex Azar last year suggested they are one of the reasons drug prices are so high. “Today’s rebate system is set up in the shadows to serve entrenched interests—drug companies who set these prices so high and the pharmacy benefit managers who receive billions of dollars in rebates without patients ever knowing where the money goes,” he said.
However, the latest proposal to prohibit coupons from applying toward out-of-pocket costs does nothing to eliminate these rebate programs. In fact, rebates now benefit insurance companies by letting them double dip: they receive customers’ full copays—with the manufacturers’ coupons—and extend the duration of patients’ deductibles.
Arizona, Illinois, Virginia, and West Virginia have all banned copay accumulator adjustment programs—and other states are considering similar provisions.
More than 50 HIV and LGBT advocacy groups signed and sent a letter to CMS last month. The letter not only slams CMS for a policy that would “severely limit access to these assistance programs,” it says the agency misinterpreted the 2004 IRS notice which it used to say the 2020 NBPP policy conflicted with requirements for high-deductible health plans with health savings accounts.
According to Wayne Turner, J.D., senior attorney at the National Health Law Program, there is no good rationale for CMS’s reversal on copay accumulator adjustment programs.
“The administration said it wants to lower the cost of prescription [drugs], but their actions undercut that goal,” Turner said. He added that if CMS wanted to steer patients away from higher-cost drugs, its stated goal, it could let insurers do this through prior authorizations, or by step therapy, which could work for some medications, but not for HIV treatment.
The National Health Law Program and The AIDS Institute have set up a portal for public comments. If the NBPP rule goes down allowing copay accumulator adjustment programs, advocates say Congress will need to intervene and stop it, though they’re resigned to any effort being stopped in the Republican-controlled Senate.
Rolling Back Discrimination Protections
Also last year, the administration proposed eliminating key protections of the Affordable Care Act’s (ACA) nondiscrimination provision, Section 1557. The ACA prevents insurers from excluding people with pre-existing conditions, or making it harder for them to get insurance. Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs or activities.
The proposed rule would eliminate certain provisions in 1557, including the requirement that covered entities publish nondiscrimination notices and include “taglines” in foreign languages on all significant publications. HHS claims eliminating the tagline requirement would save the health care industry billions in unnecessary regulatory costs.
According to Michael Shankle, people with HIV, even if they’re asymptomatic and undetectable, should qualify as a protected class, and 1557 was one of the ACA provisions that kept insurance companies from doing a run around the ACA. “The new proposal, which not only ends notifying people of their rights, would let insurers do what Florida did, with no mechanisms for individuals to challenge violations,” he said.
Against the spirit and the letter of the ACA, Florida insurers—CoventryOne, Cigna, Humana, and Preferred Medical—had been requiring customers with HIV to pay higher out-of-pocket costs for their medications, including generics. After The AIDS Institute and the National Health Law Program filed a complaint with HHS’s Office for Civil Rights in 2014, the companies revised their policies.
Klein said revising 1557 or any antidiscrimination language in the ACA opens the door to “indirect and insidious discrimination.”
“In Florida, they were trying to manipulate benefit designs to discourage people with HIV from selecting those plans,” she said. “We need to prevent [the administration] from allowing new hoops for patients, like letting insurers put drugs for certain disorders on a higher tier when there’s no generic equivalent.”
“Cost Containment” Could Also Affect Prices
Shankle said that HIV advocates need to keep an eye on other administration proposals that could hurt people with HIV, and he pointed to a new CMS project called, “Healthy Adult Opportunity,” which allows states to conduct pilot projects on how cost-containment measures might impact people on Medicaid. Spoiler alert: Shankle says, “Cost containment by limiting payout under Medicaid will hurt the poorest Americans.”
Klein said the health advocacy community needs to be vigilant about any administration proposals that would, directly or indirectly, hurt people with HIV. “The administration says they want to lower drug prices and says they want an end to HIV, but their policies could have the opposite effect,” she said.