Virginia becomes first to require that health insurers count coupons, copay assistance toward deductible

Increasingly, as drug prices inch upwards, patients are relying more on coupons they receive directly from pharmaceutical manufacturers to cover the cost of their drugs.

But health insurers have developed a tactic that essentially negates that benefit by refusing to count the value of the coupon or copay assistance toward the patient’s deductible.

Thanks to two bills that made their way successfully through the General Assembly and received the governor’s signature last week, though, health insurers will have to count any payments made on an enrollee’s behalf toward their deductible.

According to Fair Health Care VA, a patient advocacy group, Virginia is the first state to take action to address the issue.

“Patients should not be denied one of the key benefits of copay assistance programs, particularly since insurers are already getting the value of negotiated drug price discounts while withholding these benefits from patients,” Dr. Bruce Silverman, a Richmond nephrologist and member of Fair Health Care VA, said in a statement.

Nearly one in five major employers do not count coupons and copay assistance programs toward a patient’s deductible, the group says.

Changes in insurance regulation at the state level, though, will not impact self-insured companies, who are subject to federal regulations instead. Sixty-one percent of people who get their insurance through their employers are covered by a self-insured plan, according to the Kaiser Family Foundation.

Del. Timothy Hugo, R-Fairfax, and Sen. Siobhan Dunnavant, R-Henrico, carried the legislation, which requires “any carrier issuing a health plan in the commonwealth to count any payments made by another person on the enrollee’s behalf, as well as payments made by the enrollee, when calculating the enrollee’s overall contribution to any out-of-pocket maximum or any cost-sharing requirement under the carrier’s health plan.”

Gov. Ralph Northam signed the bills last week, around the same time he also signed legislation that will require health insurers to create shared savings programs. The programs are designed to give patients incentives to choose lower-cost health options because they’ll share in some of the savings with their insurer. It also includes a transparency component so patients can log onto their insurer’s website and compare costs. Dunnavant and Del. Kathy Byron, R-Bedford, carried the bills.

But Northam also axed several other bills related to short-term and catastrophic health plans that Republicans see as a potential alternative to high costs. Opponents have argued that the plans’ meager benefits put patients unnecessarily at risk, while proponents claim they’re an inexpensive alternative for healthy individuals.

In a statement, Northam said he vetoed the bills because they “put Virginians at risk of being underinsured, result in rapidly increasing marketplace premiums, and undermine key protections in the Affordable Care Act.”