Court Ruling Will Limit Accumulators

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A district court’s decision to strike down the 2021 NBPP is the latest policy update on the use of copay adjustment programs, but questions persist.

On September 29, the US District Court for the District of Columbia struck down a federal rule that allowed plans and pharmacy benefit managers (PBMs) to omit manufacturer copay assistance from beneficiary cost-sharing calculations (e.g., maximum out-of-pocket totals). Over the past 5 years, plans and PBMs have increasingly utilized this approach in programs called copay accumulators to restrict manufacturers’ copay assistance from counting toward enrollees’ cost-sharing obligations.

The lawsuit was filed in August 2022 by three patient advocacy groups—the HIV+Hepatitis Policy Institute, the Diabetes Leadership Council, and the Diabetes Patient Advocacy Coalition—along with three patients who use manufacturer copay assistance. The plaintiffs argued that provisions in the 2021 Notice of Benefit and Payment Parameters (NBPP) that allowed plans to not count copay assistance (e.g., the definition of cost-sharing) conflict with preexisting statutory and regulatory definitions of the term and that the provisions were “arbitrary and capricious.” The court vacated provisions of the 2021 NBPP and requested the US Department of Health and Human Services (HHS) interpret the statutory definition of the term cost-sharing in all future rulemaking.

The plaintiffs and third-party organizations state that health plans and PBMs must now revert to the 2020 NBPP, which stipulates that any form of cost-sharing assistance, including manufacturer copay assistance, must be counted toward enrollee cost-sharing obligations for any drugs without a “medically appropriate generic equivalent.” This will significantly limit the use of copay accumulators in federally regulated large group and self-insured plans. However, stakeholders do not expect this ruling to limit the use of other adjustment programs like copay maximizers and alternative funding programs (AFPs).

This ruling is likely to have a far-reaching impact on several key stakeholder groups, including:

  • Patients: Patients could meet their cost-sharing obligations earlier in their benefit year. Reducing or eliminating cost-sharing for the rest of the year may increase their utilization of and adherence to products.
  • Health Plans/PBMs: Plans and PBMs may respond by increasing the use of copay maximizer programs or engaging with AFPs. Plans and PBMs could also seek to alter formulary tiering (e.g., preferred tier) or increase utilization management policies.
  • Manufacturers: Manufacturers’ average copay assistance spend per patient enrolled could decline as this assistance must now count toward patient cost-sharing calculations. However, if plans respond with modified benefit structures, manufacturers may see an influx of additional patients seeking financial assistance.

Additionally, questions remain as to how HHS will respond to this ruling, including whether they provide further interpretation of the definition of cost-sharing via future rulemaking (e.g., the 2025 proposed NBPP) or if they will file an appeal or motion to stay within 60 days. This ruling could also ramp up state and federal legislation to restrict the use of copay accumulators. To date, 19 states, the District of Columbia, and Puerto Rico have enacted copay accumulator bans, and Congress is currently considering the HELP Copays Act, which would prohibit copay accumulator use in individual, small group, and employer-sponsored health plans.

Avalere Outlook

This ruling is the latest market and policy update in the evolving landscape of patient access and affordability support initiatives. As stakeholders react to the developments of this court ruling, manufacturers, foundations, payers, and advocacy groups must also consider the role that other policy changes—such as Medicare Part D benefit redesign—play in patient support strategies.

With hands-on policy experience from the payer, manufacturer, and third-party vendor perspectives, Avalere helps clients understand the evolving landscape of patient support and affordability, model the impacts of these policy changes, and identify solutions accounting for financial exposure while maximizing appropriate patient access. To learn how Avalere can help your organization respond to—or shape—the evolving copay adjustment program landscape, connect with us.

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