What are Copay Maximizers?

Copay Maximizers are a feature of pharmacy benefit plans that is 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.

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 Maximizer programs to counteract the effect of PAPs.

Without a Copay Maximizer 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.

Under a Copay Maximizer program, wWhen a patient goes to fill a prescription, they may use any PAP funds available to help cover their cost share of the medication. However, the pharmacy benefit plan resets the patient’s cost sharing amount to be equal to the total annual value of the PAP funds. For example, if a PAP pays $1,200 per year in benefits for a specific drug, the patient’s cost sharing for that drug would be set at $100 per month. In addition, the PAP payments do not count toward the deductible and out-of-pocket maximums. That way, the payer gets the full value of the PAP program and the patient still is responsible for deductible and out-of-pocket maximums for other services.

Copay Maximizers vs. Copay Accumulator

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 Maximizer Plans?

A Maximizer Plan is a pharmacy benefit design that includes a Copay Maximizer provision. Under a Copay Maximizer program, when a patient goes to fill a prescription, they may use any PAP funds available to help cover their cost share of the medication. However, the pharmacy benefit plan resets the patient’s cost sharing amount to be equal to the total annual value of the PAP funds. For example, if a PAP pays $1,200 per year in benefits for a specific drug, the patient’s cost sharing for that drug would be set at $100 per month. In addition, the PAP payments do not count toward the deductible and out-of-pocket maximums. That way, the payer gets the full value of the PAP program and the patient still is responsible for deductible and out-of-pocket maximums.

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 Maximizers

Here’s an example of how a Copay Maximizer program works:

Let’s say you have a health insurance plan with a Copay Maximizer 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.

The payer resets your copayment to $25 and uses the full $300 to defray its share of pharmacy costs. When you fill another prescription, you find that despite having satisfied the $25 copayment each month via the PAP, none of that counted toward your deductible or out-of-pocket cost, leaving you responsible for cost sharing on the next prescription.

The author generated this text in part with ChatGPT, OpenAI’s large-scale language-generation model. Upon generating draft language, the author reviewed, edited, and revised the language to their own liking and takes ultimate responsibility for the content of this publication.