Insurers cutting back on drug coupons amid concerns over consumer costs

By Lisa Schencker / Chicago Tribune

With many drug prices rising, consumers often pull out coupons or discount cards from drugmakers to save money when they buy medications at pharmacies. But some insurers are limiting how those discounts may be applied amid concerns they’re driving up health care costs for everyone. Curbing the coupons could mean more money out of consumers’ pockets in the short term, but in the long run could also help hold down drug prices and health care costs, say critics of the cards and coupons.

Blue Cross and Blue Shield of Illinois told its members with individual plans this year they can still take advantage of the discounts, but they won’t get credit toward their deductibles or out-of-pocket maximums. Cigna only allows coupons to be used for specialty drugs — medications used to treat rare or complex conditions. UnitedHealthcare and Aetna declined to comment on their policies on the discounts.

A number of experts and advocates for lower drug prices applaud any actions aimed at stemming the use of copay cards and coupons, which are available online, through the mail or from doctors.

Typically, patients with individual and employer-based plans can use the cards or coupons to save money on their insurance copays for certain prescription medications at the pharmacy. While a coupon can reduce all or part of a patient’s copay, the insurance company still has to pay its full portion for what might be a high-priced drug — a cost that opponents of the discounts say is ultimately passed on to all consumers in the form of higher insurance premiums.

Such discounts made news last year amid outcry over the skyrocketing costs of EpiPens, sold by Mylan. As part of its response to the uproar, Mylan offered $300 savings cards to patients with nongovernment insurance to help lower their out-of-pocket costs. Mylan still faced criticism that the discounts wouldn’t help everyone as much as simply lowering the price would.

“The copay coupons are a scam by the drug companies,” said David Mitchell, president and founder of Patients for Affordable Drugs, a nonprofit that doesn’t take money from drug companies or insurers. “Effectively we wind up, all of us, paying a higher price for our health insurance because they just steered us to a more expensive drug that ultimately gets paid for by someone.”

Pharmacy benefit managers, which act as middlemen between pharmacies and insurance companies, don’t like the coupons either. The coupons are often used to drive patients to higher-cost brand drugs instead of generics, said Mark Merritt, president of the Pharmaceutical Care Management Association.

Drug companies, however, defend the practice as a way to make sure patients have access to the medications they need. The coupons “can provide a valuable source of assistance for many commercially insured patients to afford out-of-pocket costs associated with insurance coverage for their medications,” said Holly Campbell, a spokeswoman for the Pharmaceutical Research and Manufacturers of America, in an email.

Patients like John Ellmann, of suburban Chicago, know how much help such cards and coupons can be.

Ellmann, 59, uses a copay card for a prescription migraine medication he said would otherwise cost him $100 out-of-pocket for a month’s supply, with insurance. “That would be a barrier to me filling my prescription,” he said.

The copay card from the drugmaker takes his out-of-pocket cost down to $10 a month, he said.

Ellmann was among the Blue Cross and Blue Shield of Illinois members with individual plans who were informed earlier this year that the insurer would not apply the value of the discounts toward deductibles or out-of-pocket maximums.

Colleen Miller, a spokeswoman for the company, said in an email that Blue Cross put the policy in place in accordance with federal rules and guidance as well as industry concerns over use of the cards and coupons. “This policy helps to ensure that the individual health insurance market is more stable and affordable for all of our members,” Miller said.

That’s in line with the federal government’s position on the matter. The U.S. Department of Health and Human Services said in the federal register in 2014 that it encourages insurers offering individual plans to reject cost-sharing payments from companies.

A concern, especially in the individual market, is the discounts could offset the balance of healthy versus sick people who sign up for insurance plans by attracting more sick people who might use the discounts to those plans, said Harvard Business School Professor Leemore Dafny. That could lead to higher insurance premiums across those plans, she said.