By Peter J. Pitts
For chronically ill Americans, the economic damage from COVID-19 could be nearly as life-threatening as the virus itself. More than 40 million workers have filed for unemployment since the beginning of the outbreak. For many, the financial challenges of joblessness have made it harder than ever to afford their insurance companies’ medication copays.
That’s why a new decision from the Trump administration couldn’t have come at a worse time. The rule, which was finalized in May, enables insurers to artificially inflate patients’ out-of-pocket drug costs. In doing so, it creates unnecessary challenges for Americans who are already struggling to stay healthy.
For many patients, high pharmacy bills were a heavy burden even before COVID-19. A Kaiser Family Foundation survey from November found that half of patients in poor health had difficulty paying for their medications. And 3 in 10 reported skipping doses for financial reasons.
This “non-adherence” causes 125,000 deaths each year and as many as a quarter of hospitalizations. It also inflates U.S. healthcare spending by up to $289 billion annually.
Now that coronavirus lockdowns have sent our economy into a tailspin, drug adherence rates are likely to plummet further as Americans look for new ways to make ends meet.
Consider that a quarter of the country has dipped into savings in recent weeks, currently, 14% have borrowed money from friends or family, per Northwestern Mutual. It’s only a matter of time before large numbers of Americans stop filling the prescription medicines they need.
In times like these, helping the hardest-hit patients take their medications ought to be a top priority. Yet the Trump administration has done precisely the opposite. The new rule from the Centers for Medicare and Medicaid Services (CMS) would help insurance companies nullify the prescription drug coupons that make medicines affordable for millions of Americans.
In many health plans, patients pay for their own drugs up to a certain limit, known as a deductible, after which they are responsible for a smaller copay. The patient remains on the hook for those copays until he or she reaches the federally mandated out-of-pocket limit, which in 2020 was $16,300 for families.
To help defray out-of-pocket costs, drug firms usually offer generous coupons on brand-name medications.
For cash-strapped patients, these discounts can be life-changing. About a fifth of commercially insured patients use coupons to lower their pharmacy costs. These coupons cut out-of-pocket drug spending by $13 billion in 2018. Just as important, drug coupons have been shown to increase adherence for everything from cholesterol medication to anti-inflammatory drugs.
These coupons only benefit patients if they count towards the out-of-pocket limit. Otherwise, patients would still be on the hook for huge pharmacy bills.
Unfortunately, the new CMS rule allows insurers to stop counting coupons towards the out-of-pocket cap. That means insurance giants will extract more money out of struggling Americans’ pockets.
Officials in states such as Virginia, West Virginia, Illinois and Arizona have already banned this practice. Unless other states follow suit — or Congress intervenes and passes legislation nullifying the rule — millions of Americans could face higher pharmacy bills while battling the worst financial crisis since the Great Depression.
Barring intervention, America could face a pandemic of non-adherence that puts millions of lives at risk. Unlike COVID-19, this new public health emergency won’t be caused by a wily virus, but by the callousness of Washington policymakers.