What is a Copay Accumulator?

Copay Accumulators are a feature of pharmacy benefit plans that are designed to help insurers save money on prescription drug costs. They are intended to redirect funds that pharma companies contribute to patient assistance programs from patients to payers and discourage patients from filling high-cost medications if a lower-cost alternative is available.

Many pharma companies operate patient assistance programs (PAPs), also known as copay offset programs, to help patients afford high-cost brand-name medications by covering the patient’s share of costs. However, critics say that PAPs encourage patients to take high-cost drugs even when lower-cost but equally effective alternatives are available; immunize patients from any cost-sharing, while leaving the payer responsible for the majority of the cost; and effectively defang payers’ pharmacy benefit designs.

Some payers have launched Copay Accumulator programs to counteract the effect of PAPs.

Without a Copay Accumulator program, the pharma company’s PAP payments would offset the patient’s annual pharmacy deductible or out-of-pocket maximum. Once the patient’s share of pharmacy costs exceeds the deductible or out-of-pocket maximum, the payer is responsible for all remaining pharmacy costs.

A Copay Accumulator program limits the amount of money that a payer contributes to pharmacy benefit costs. The pharma company’s PAP payments do not count toward the patient’s pharmacy deductible or out-of-pocket maximum. And once the PAP funds are exhausted, the patient is responsible for the full cost of the therapy, and it is only at that point that patient spending contributes to the deductible or out-of-pocket maximum.

Copay Accumulator vs. Copay Maximizers

A Copay Accumulator program is similar to a Copay Maximizer program, in that both limit the amount of money that a payer contributes to pharmacy benefit costs. In both programs, the pharma company’s PAP payments do not count toward the patient’s pharmacy deductible or out-of-pocket maximum.

With a Copay Accumulator program, once the PAP funds are exhausted, the patient is responsible for the full cost of the therapy, and it is only at that point that patient spending contributes to the deductible or out-of-pocket maximum.

With a Copay Maximizer program, however, the PAP funds are applied evenly throughout the benefit year and the patient’s cost-sharing amount is reset to the total available PAP funds for the year.

What are Accumulators in Healthcare?

Accumulators in healthcare generally refer to programs or mechanisms that track and accumulate healthcare expenses or benefits over a certain period of time. These accumulators are often used in health insurance to help manage costs and ensure that patients and insurers are paying their fair share for healthcare services and medications.

What is a Variable Copay Program?

A Variable Copay Program is a type of pharmacy benefit design intended to mitigate the high-cost of specialty pharmaceuticals by leveraging any available pharma manufacturers’ patient assistance programs. The payer or its partner identifies high-cost pharmaceuticals with PAPs. Patients can get these drugs only through Variable Copay Program entity, which ensures that members and the payer get the full value of the PAP.

Example of Copay Accumulator

Here’s an example of how a Copay Accumulator works:

Let’s say you have a health insurance plan with a Copay Accumulator program in place. You need to fill a prescription for a brand-name medication that costs $500 per month, and your health insurance plan requires you to pay a $50 copayment for each prescription. The provider or pharmacy informs you that the pharma manufacturer offers a copay offset program with a maximum value of $300.

For the first six months that you receive the prescription, your $50 copayment is covered by the PAP, until the full $300 value is exhausted. Then you are responsible for the $50 copayment for the remaining six months of the year. What’s more, despite the fact that you satisfied the $25 copayment for the first six months via the PAP, none of that counted toward your deductible or out-of-pocket cost, leaving you responsible for full cost sharing on the remainder and any other prescriptions.