Note: In updating our blog post on prescription discount cards, we determined it would be more useful to our readers to split this material into several posts. We’re covering manufacturer copay cards this week. Check back later for a follow-up on generic drug savings programs and more, and see last week’s post on prescription discount cards.
Imagine you’re standing at the pharmacy counter. After months of testing, your doctor diagnosed you with ulcerative colitis and prescribed a brand name drug. You didn’t question it, because you were grateful to have a potential solution to your pain. Then the pharmacist says, “Are you aware of the price of this medication?”
It’s two thousand dollars for a one-month supply. Talk about sticker shock.
Undeterred, you pull out the prescription discount card that you’ve used before. It brings the price down around $1700. Not in your budget right now.
This is the point at which many patients might give up and go home, completely abandoning their first fill. But you don’t want to give up. You ask the pharmacist about a generic alternative. It is approximately $1400 a month, and about $500 with your discount card. That’s still too much.
But then you find a copay card from the manufacturer that would make your brand-name prescription only $25 a month. Now that’s doable!
What are these manufacturer cards? How can they offer such an expensive drug at such a low price? Let’s find out.
How do manufacturer copay cards work?
Remember, as we learned in a previous blog post, prescription discount cards are not insurance. But while independent discount cards are used instead of insurance, manufacturer copay cards can be used with commercial or private insurance plans.
Here’s how it generally works: patients sign up for a card through the manufacturer’s website. Once enrolled in the copay program, the patient will receive a card from the manufacturer. When the patient shows the card to the pharmacist, the pharmacy processes the prescription using the patient’s insurance information as the primary payer and the copay card information as the secondary payer. The patient then pays a small portion of their copay or nothing at all, and the drug manufacturer will pick up the rest of the copay.
The patient’s pharmacy benefit manager (PBM) pays for the drug itself. For that reason, PBMs prefer patients to choose less-expensive drugs from the get-go. To further discourage the use of copay cards, PBMs have also implemented copay accumulator programs. These ensure that only your reduced copayment will go towards your deductible, not the entire price of the drug. When your copay card expires, you could be surprised with a big pharmacy bill.
What to know about Medicare & Medicaid
Medicare Part D or Medicaid patients cannot use manufacturer copay cards due to anti-kickback laws. Also, it is argued that about 60% of the time manufacturer cards are for brand-name drugs that have lower-cost, generic alternatives. While copay cards may reduce a member’s personal out-of-pocket costs, the government would get stuck with the bill for an expensive brand-name drug. Many believe that over time, covering those brand-name drugs would increase the cost of Medicare and Medicaid for taxpayers.
What are the benefits of copay cards?
Manufacturer copay cards can be powerful tools for patients on plans with high deductibles, high copays, or very limited drug formularies, but also for patients with rare or complex diseases. Many maintenance medications for illnesses like HIV and hepatitis C do not have generic alternatives and can be very expensive. Without a manufacturer card, these life-saving prescriptions could be out of reach for many patients.
Do your own research
If you have state or federal health coverage, it’s smart to ask your doctor if there are generic alternatives for your brand-name prescriptions. Look up the typical prices of the brand and generic versions. If both are out of your budget, call your doctor. There may be another medication in the same drug class that would be equally useful.
If not, you may need to use a prescription discount card to reduce the price of the drug instead. You may also be eligible for other kinds of assistance through your state, the drug manufacturer, or a third party.
If you have commercial or private insurance, you have more choices. If you cannot afford a brand-name drug and there are no alternatives to it, you have two paths you can take:
- You could ignore your insurance and buy the drug using a prescription discount card to reduce the price. Remember, this will not count towards your deductible.
- You could seek out a manufacturer copay card to reduce the price. Your insurance will cover the cost of the drug, but keep in mind that these cards may have restrictions or time limits. If you expect to take this medication long-term, you may have to find a new solution after a certain amount of time.
If you choose the second option, make sure you research the following:
- Any restrictions on how the card can be used, who can use it, and how long it can be used. Read the fine print!
- Whether your state has any legislation regarding manufacturer cards. For example, in 2017 California banned manufacturer cards for any drugs that have a generic equivalent.
- Whether your insurer has a copay accumulator program.
- Whether your state has any legislation regarding copay accumulator programs. If they have been banned in your state, then you might be able to reach your deductible more easily using manufacturer cards.
Sticker shock at the pharmacy counter is a major cause of poor prescription adherence. To help you navigate costs and stay healthy, we’ll continue our conversation about cost-saving tools in the coming weeks. Check back for posts on generic savings programs at select pharmacies, patient assistance programs (PAPs), and more.