Friday, February 04, 2022

A Solution to the Medicare Copay Problem

Today’s guest post comes from Jeff Berkowitz, CEO of advisory firm Real Endpoints.

Jeff describes problems with Medicare copays that reduce adherence and persistence among seniors. He then describes RE Assist, Real Endpoints’ tech-enabled solution with key information on foundations for more than 30 diseases.

To learn more about Medicare copayments and how the RE Assist solution helps patients, register to view Real Endpoints’ free webcast: Solving the Medicare Co-pay Dilemma.

Read on for Jeff’s insights.

A Solution to the Medicare Copay Problem
By Jeff Berkowitz, CEO, Real Endpoints, LLC

For many insured patients, even those who can’t on their own scrape together the money for their drug copays, affording prescriptions isn’t a problem since the drug company takes care of the cost share.

But that’s not true for Medicare patients, and in particular those Medicare beneficiaries who are taking expensive pharmacy-benefit drugs...and who thus, absent copay support, often end up abandoning their scripts at the pharmacy counter. RE Assist provides patients a turnkey, tech-enabled solution.

The limitations begin with the anti-kickback statute. That law bans pharma companies from providing copay assistance to Medicare patients—either directly or, as Pfizer tried to argue in its losing lawsuit against the Department of Health and Human Services (HHS), through an “indirect charity program” (essentially funding an independent foundation to provide the cost-sharing help). Outside of supplementary insurance programs, HHS only allows what it considers truly independent alternative funding sources, like charitable foundations, to help Medicare patients with their out-of-pocket expenses.

And those bills are troublesome. Half of Medicare beneficiaries have annual incomes of less than $30,000—which, after rent, food, and utilities, doesn’t provide a lot of room for drug copays and deductibles.

Let’s start with fee-for-service Medicare. There’s no cap on a beneficiary’s out-of-pocket expense—which means, for an oncologic costing $15,000 a month, they could be paying up to $36,000 in an annual copay. Medicare Advantage members have an easier time: those plans cap out-of-pocket costs, but at a level that’s still often unaffordable, generally about $6,000 a year, or more than 10% of the income of the average 70-year-old.

And the problem isn’t limited to Medicare. An increasing number of middle-income people buy commercial plans with high deductibles. The average single-coverage high-deductible plan is now $3200, which essentially makes some drugs entirely unaffordable.

As a result, when faced with those copays and deductibles, Medicare patients will often either abandon their prescriptions completely or turn to pharma companies’ free-drug programs.

The long-term and best Medicare solution is government action. Both Republicans and Democrats have introduced legislation to cap out-of-pocket spending for Part D. But those bills are stuck in the tarpit which is the US Congress.

The current stopgap solution: pharma or their hubs can, and do, provide patients lists of alternative funding sources (typically referred to as foundations) to help with cost shares. But, that’s not straightforward either. For some drug categories, there can be a dozen of these foundations, each with its own rules around eligibility. Sometimes they have funding available for cost-shares; sometimes they don’t. Their donation-dependent coffers empty and refill, unpredictably and opaquely. Sometimes patients call and there are no funds. Sometimes they call, and funding is available.

When patients call, they need specific information (e.g., doctor’s contact information, proof of income, proof of insurance, age, residency, diagnosis), which varies from foundation to foundation. By the time the patient finds the requisite data, the funding may no longer be available. After all, in some categories like non-small-cell lung cancer (NSCLC), more than 20 drugs need to tap into the same limited funds. Some NSCLC patients, by sheer luck, get to foundations before they run out of money; others end up with nothing. After a few failed attempts, many patients either drop out of the search and abandon their scripts. Oncology patients, for example, are four times more likely to abandon therapy when their annual out-of-pocket costs exceed $2,000), while others apply—and hopefully qualify to get—patient assistance (i.e., free drug) from the manufacturers.

It’s a cumbersome process, filled with dead ends—a needle-in-a-haystack exercise of placing phone call after phone call to a long series of funding sources. It would simplify things if companies or their patient support services (PSS) could call the foundations on behalf of the patients, with all the requisite information in hand. But, legally, they can’t. And given the number of patients who would need the service, pretty expensive if they could.

Some patient support vendors are better than others at getting the foundation information patients need. Specialty pharmacies are generally more helpful, but, without a truly systematic, comprehensive approach, even the best can’t provide all the relevant information or find all the possible funding sources.

More practical is Real Endpoints’ new tech-enabled proprietary program called RE Assist. The platform’s continuously updated database contains all the key information on all foundations for more than 30 diseases, scanning each foundation in real time for its funding availability, spitting out alerts when closed foundations (those without money) open up, or open foundations close. It also provides each foundation’s requisite eligibility criteria, creating electronic documents that walk patients through the information they need to apply to each foundation. Some pharma companies are using it with their internal PSS groups; others by assigning it to their external vendors. And because RE Assist is agnostic as to foundation—it doesn’t provide information on specific groups but scans all of them—it doesn’t run afoul of HHS rules and the much-feared Office of Inspector General.

Companies spend billions of dollars on rebates to ensure their drugs are covered by Part D and Medicare Advantage plans. But that spending does no good if patients can’t afford their cost shares. It’s absurd for the pharma industry to wait for Congress to solve the Medicare cost-sharing problem—tied in knots, legislators seem to be acting on virtually nothing of importance. It’s time for the industry to take advantage of the practical solutions at hand.

To learn more about the Medicare copayment issue, its impact on patients, and the RE Assist solution, register to view our free webcast: Solving the Medicare Co-pay Dilemma.

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