Merck & Co. and GlaxoSmithKline PLC are holding off on
providing help with out-of-pocket drug costs to people insured
under the Affordable Care Act, while other pharmaceutical companies
go ahead, amid mixed signals about whether the copay assistance is
legal.
The help is a staple of pharmaceutical-industry marketing to
people insured by commercial health plans. It costs drug makers
billions of dollars a year. But by subsidizing the out-of-pocket
costs triggered by a prescription, companies can help to ensure
that the prescription is filled and that insurers must reimburse
the drug companies for the large remainder of a drug's cost.
Health plans and pharmacy-benefit managers criticize the tactic,
which they say hurts their efforts to steer patients to
lower-priced generic medicines. Federal law bars copay help for
people insured under federal insurance programs such as Medicare
and Medicaid as an illegal kickback that encourages unnecessary
spending.
It has been unclear whether the prohibition would extend to
people insured through the exchanges established by the health-care
overhaul, where consumers can get federal subsidies to help pay for
their policies.
In October, Health and Human Services Secretary Kathleen
Sebelius indicated the practice was OK. The next month, the agency
suggested otherwise, issuing materials that said the agency
discourages copay assistance. Then in March, the department said in
an "interim final rule" that health plans offered through the
exchanges must accept payments providing help with premiums and
other out-of-pocket costs for HIV/AIDS patients, but didnt mention
other types of drugs.
Merck has decided against allowing patients enrolled in plans
through the exchanges to redeem the coupons the company furnishes
to subsidize copay costs, a spokeswoman said Wednesday. The
spokeswoman attributed the move to "uncertainty surrounding the
roll out" of the health-care overhaul, citing the statements made
by HHS.
"Merck plans to revisit this decision once more information is
available about the implementation of the Affordable Care Act," the
spokeswoman said.
GlaxoSmithKline isn't offering the copay help to people insured
through the exchanges "at this time" and is "continuing to monitor
the situation, " a spokeswoman said.
"We made this decision based on a range of factors, including
the guidance that is currently available from the federal
government," the GlaxoSmithKline spokeswoman said. "This is a very
dynamic environment for health care in the U.S. We continue to ask
ourselves how can we best meet the needs of these patients with
these new insurance options."
By contrast, Amgen Inc., Eli Lilly & Co., Gilead Sciences
Inc. and Johnson & Johnson said they are providing the copay
help.
Gilead and J&J cited the letter that Secretary Sebelius
wrote in October condoning the assistance.
Lilly "will be monitoring the external environment to see if we
need to make a change in the future," a spokesman said.
"Under the new health-insurance exchanges, it is not uncommon
for patients to face coinsurance of 40% or more for their
prescriptions. To help make sure that patients are able to access
the therapies they need, Amgen currently offers cost-sharing
assistance to eligible patients," an Amgen spokeswoman said.
The companies' actions were reported earlier by Bloomberg News.
A Medicare and Medicaid spokeswoman referred to the various
statements the Health department has made on the subject.
Write to Jonathan D. Rockoff at jonathan.rockoff@wsj.com
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