Pharmacy Receipt Copayaccumulator programs essentially wipe out certain employeeexpenses that would otherwise count toward the employee'sdeductible and out-of-pocket totals. (Photo: Shutterstock)

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A patient advocacy nonprofit is warning employer-sponsored planadministrators that a benefit being marketed to them as a cost-control measure may violate certainstate and federal health insurance laws.

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The benefit: copay accumulator programs. These programsessentially wipe out certain employee expenses that would otherwisecount toward the employee's deductible and out-of-pocket totals.

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Related: Pharmacy benefit managers crack down on copayassistance programs

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Employees who receive discount coupons from drug manufacturersfor high cost specialty drugs are particularly vulnerable to thenegative offset of copay accumulators, says the nonprofit Alliancefor the Adoption of Innovations in Medicine, known colloquially asAimed Alliance.

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The group released a study of the adoption and effects of copayaccumulator programs, and concluded that as such programsproliferate through employer plans, employer plan liability isgrowing apace.

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“Due to the misleading nature of copay accumulator language,lack of appropriate notice, and in some instances, the singling outof individuals with specific health conditions, these programs canbe unfair, deceptive, and discriminatory,” said Stacey Worthy,counsel to Aimed Alliance. “Health insurance plans that includecopay accumulators might provide the illusion of cost savings, but,in actuality, they can increase the risk for liability and resultin legal implications for the employer without any guaranteedcost-savings.”

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The study noted that, with employer plan costs continuing toincrease, some insurance brokers have successfully added theseprograms to their clients' plans. The study cited a NationalBusiness Group on Health survey that found that 17 percent of thelarge employer respondents have already adopted a copay accumulatorprogram. More than half said they are considering putting such aprogram in place for 2019 or 2020.

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Aimed Alliance said such programs are rarely transparent inenrollment language about their true mission: to reduce employercosts while making it more difficult for employees to access theirfull range of benefits. By offsetting the benefit of such copayassistance tools as prescription drug copay cards, copayaccumulator programs put employee health at risk and raise manyquestions about the legality of the programs.

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Employees who depend upon assistance to afford drugs thatmaintain their health tend to either stop using them or cut back ontheir use. Often, there is no low-cost alternative.

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“Some argue that copay accumulator programs are intended to'encourage' patients to select or switch to lower-cost alternativetreatments,” the study said. “However, such programs may be viewedmore accurately as a punitive measure that forces patients toswitch or stop taking their treatment because they cannot affordtheir high copays or coinsurance once assistance is exhausted.Moreover, in many instances, alternative treatments are notavailable for many individuals who depend on copay assistance.”

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The cost of treatment for medical conditions such as rheumatoidarthritis, hemophilia, cancer, HIV, hepatitis C, and multiplesclerosis, which require specific drugs for treatment, wouldsuddenly shift rapidly to the patient/employee.

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The study cited a wide spectrum of potential violations of thePatient Protection and Affordable Care Act; the Federal TradeCommission; ERISA; and a list of state laws that could triggerlegal action against the plan. The implication of the report wasthat, if employers are not motivated by the pursuit of betterhealth for plan members, they should be motivated to have theirlegal departments research such programs before signing on forthem.

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