Authored by Nisha Desai, MPH, Account Director, Cyan Health
On December 21, 2020, CMS published its final rule on how manufacturers are required to account for patient assistance programs in their best price calculations—doubling down on their initial rule despite industry pushback.
To recap, in June, CMS proposed an interim rule stating that manufacturers would need to ensure that patients reap the full benefit of manufacturer-sponsored copay assistance programs. Then, and only then, would the manufacturer not be required to include the copay assistance in their best price calculations. This rule was a direct reaction to the advent of a PBM/payer-driven trend—copay accumulator programs.It is important to recall that copay accumulator programs prevent manufacturer-sponsored copay assistance from being applied to a patient’s deductible. In these situations, the health plan benefits from the manufacturer-sponsored copay assistance program instead of the patient, leading CMS to believe that the copay assistance should be subject to best price calculations. Note, while Medicare and Medicaid patients are not eligible for manufacturer-sponsored copay assistance, CMS has an interest in the implications of this concept because of the relationship to “best price”.
In response to this interim rule, several stakeholders provided feedback during the comment period—most notably that manufacturers are not aware of when these practices by the health plans take place, nor do they track what happens beyond the point of sale. Therefore, they make reasonable assumptions that their copay assistance programs meet the criteria that exclude copay assistance from best price.
Despite pushback on this rule from industry stakeholders, CMS has doubled down on this ruling. While copay accumulators are payer-mandated programs, CMS believes that it is still the manufacturer’s responsibility to ensure that the full value of the assistance is passed on to the patient. Effective January 1, 2023, in situations where this criterion is not met, manufacturers will officially be required to include copay assistance into their best price reporting.
With that being said, CMS paved two potential paths forward for manufacturers:
While these mechanisms may provide a path forward for manufacturers by bringing clarity to best price reporting, the underlying issue of patient affordability still remains.
In our next blog, we will dive deeper into the other topics covered in the CMS final ruling, including implications of value-based payments on Medicaid best price.