Is your cost-share for coverage keeping you from your medicine or other life necessities?
Cost Sharing is the share of costs that you pay OUT OF POCKET to be covered by insurance. This includes deductibles, copayments, coinsurance, and other charges. It doesn’t include your premiums, additional costs for non-network providers, or non-covered services such as procedures, treatments or to see specialists.
Patient Perspective
Marjorie
Hometown: Delaware, Ohio
In 2011, Marjorie was diagnosed with chronic myeloid leukemia (CML), a type of cancer that affected her blood and bone marrow. In the last 9 years she has seen a significant change in her health insurance coverage, most noticeable in her out-of-pocket costs.
Marjorie’s out-of-pocket costs have increased over the years from an affordable $30/month to $75/month. Now, she faces a $3,000 deductible at the beginning of her plan period and is required to pay that full amount before she can access coverage for her medications. While her family can absorb that amount, it is not without sacrifice. She has also seen a significant increase in her out-of-pocket costs after meeting her deductible when purchasing her medications
Marjorie takes a life-saving medication that keeps her CML from progressing. There is no generic equivalent for the medication and her health plan places the medication in the highest tier of her formulary, which comes with more expensive out-of-pocket costs.
Studies show that patients with a deductible have seen their out-of-pocket costs for brand medicines increase more than 50 percent since 2014. They also show that more than 55 percent of these patients’ out-of-pocket payments are made when they were in their deductible period, or with coinsurance payments – not with a fixed copay. More evidence of health plans shifting the cost of medications to the patient.
Marjorie are her husband are both still working, but are contemplating retirement. They have deep concerns about how they will be able to afford her medications if they retire.
The Problem
While patients pay a monthly premium, health plans increasingly require patients to pay more for their medicines while in the deductible phase by charging them the full retail price rather than the lower negotiated cost that the insurer pays. Once the deductible has been met, patients then pay a copay or coinsurance based on the higher retail price of a medicine, not the lesser or negotiated price the insurer pays. In recent years, the more predictable copayment is declining, while the more costly coinsurance requirement is increasing.
Health plans organize medications in tiers - from lower to higher cost tiers, and recently the number of those tiers has steadily increased. Patients are often required to use medicines in lower cost tiers first before being allowed to use medicines offered in higher tiers. The patient’s cost-share, or their own out-of-pocket costs, increases as tiers get higher.
For many patients, the out-of-pocket costs for a single medication, including ones used to treat cancer, HIV/AIDS, arthritis, multiple sclerosis and other debilitating and life-threatening diseases before their deductible is met, could cost thousands of dollars.
When patients’ out-of-pocket costs have become too expensive, they face difficult decisions about whether to stop taking medicine, stop taking it as prescribed, or put significant strain on a family’s budget
The Solution
To protect patients, Ohio should require 50% of all health insurance exchange plans to use one of the following:
- Dollar one coverage utilizing copays, not coinsurance, for all drugs, applied to all formulary tiers, with copays being reasonable, graduated and proportional; or
- A pre-deductible, copay cap of $150 per month per drug for a month’s supply; or
- Limit the annual maximum out-of-pocket costs for prescriptions to no more than the minimum annual deductible required for high deductible health plans, per the IRS Code – currently $1,350
Research shows that limiting the cost-share for medications can be done with little to no impact to premiums.