WHAT IS COST-SHARE ASSISTANCE?
Health care innovations made possible by biologic therapies, and new uses for IVIG, have improved the lives of thousands of patients living with chronic diseases and complex immune disorders. Unfortunately, due to the complicated manufacturing process, these new therapies can be incredibly expensive. As a result, many patients are unable to access these treatments, despite desperately needing them to manage debilitating illness. To provide relief and increase access to these medications, many manufacturers have created co-pay assistance programs to help patients manage the financial burden by covering a portion of the patient’s cost.
THAT SOUNDS GREAT, WHAT'S THE ISSUE?
Cost-share assistance programs can be used to incentivize prescribing habits. For example, in order to encourage patients and physicians to select a more expensive brand over the generic, the manufacturer might issue a cost-share coupon. Though the coupon might reduce the cost to the patient, the health plan would still pay full price for the brand-name drug.
In order to prevent excessive government spending, the Federal Anti-Kickback Statute prohibits pharmaceutical manufacturers from providing cost-share assistance to beneficiaries of government-subsidized health plans. So, while patients with commercial health plans are eligible to receive financial relief from these programs, patients on government funded plans are not.
THERE ARE NO GENERIC BIOLOGICS
Conventional medications are created using a chemical formula, so, using the original recipe, other companies can create generic drugs which act exactly like the original. Biologics, however, are much more complex medications, which are made in living cells. This high level of complexity makes it impossible to create a “generic” version of biologics.
Biologics are typically prescribed when a patient has exhausted every other option. Because there are no less expensive, equally effective alternatives, providing cost-share assistance to patients requiring these treatments should not be considered an excess cost to a Federal program, nor should it be considered a purposeful inducement.
Comparing the manufacturing process of a biologic to that of a traditional oral medication is like comparing the assembly of an airplane to that of a bicycle. Both are intended to provide transportation, but one requires a much higher level of detail, sophisticated engineering, and extensive research to ensure safety and efficacy.
WHAT HAS NICA DONE?
NICA requested clarification from the Office of Inspector General (OIG) on whether manufacturer cost-share assistance programs for biologics, IVIG and other specialty medications paid for by federal health plans are considered a violation of the federal anti-kickback statute, given that there are no less expensive, equally effective alternatives for these medications.
The OIG responded that there is no exception to the anti-kickback statute for manufacturer-provided cost-sharing assistance in this situation. The OIG did provide guidance on circumstances in which cost-sharing assistance may be provided to beneficiaries in financial need: Special Fraud Alert on the Routine Waiver of Copayments and Deductibles, Special Fraud Alert on Patient Assistance Programs for Medicare Part D Enrollees, and Supplemental Special Advisory Bulletin on Independent Charity Patient Assistance Programs.
NICA has now partnered up with 77 other organizations and advocates for Medicare Part D beneficiaries by signing on to a letter encouraging access to copay coupon assistance during the COVID-19 pandemic. This letter also informs Members of Congress and other policy-makers of the support within the patient community for addressing the crisis facing so many beneficiaries and their families.
Sources: Nyquist, B., MPH. (2017, February 1). Anti-kickback statute language restricting patient access to care [Letter to Gregory E. Demske]. Washington, DC.
Schmid, C., Rutta, R., Whiting, G., & Wildman, P. (2020, August 19). Medicare Stakeholders Call for Copay Assistance to Part D Beneficiaries in Response to the Pressure of the Pandemic [Letter to Gregory Demske].
Talley, M. J. (2017, March 20). OIG Response to NICA Letter [Letter to Brian Nyquist].
SO, WHAT IS THE SOLUTION?
THE ANSWER IS SIMPLER THAN YOU MIGHT EXPECT
Allow pharmaceutical companies to assist Medicare patients with their drug co-pays during the COVID-19 public health emergency (PHE). The OIG has the ability to do this through the issuing of a ‘Policy Statement’ that would free manufacturers from administrative sanctions under the Federal Anti-Kickback Statute when assisting Medicare patients with out-of-pocket drug costs during the COVID-19 PHE.
WHAT CAN YOU DO?
NICA is building a coalition to support these efforts to ensure that some of our nation’s most vulnerable patients can access the medication they need but otherwise cannot afford without cost-share assistance. We will be coordinating a conference call for more information. If you are interested in joining our coalition, please contact us using the form below.
We will also be putting together a petition for health care providers and patients to sign a letter to the OIG. We ask that you support the efforts by sharing information with you providers and patients in your network and encouraging them to take action.