LRG Supports New Jersey Legislation to Limit Patient Cost Sharing

Although GIST is among the few rare diseases that has oral chemotherapy drug treatment options available to its patients, the cost of affording these life saving medications can sometimes impose deep financial hardship depending on the terms of one’s insurance policy.

Mildred Menos currently serves at the Life Raft Group’s representative to the New Jersey Out of Pocket Prescription Cost Limit Coalition (NJ OOP Cost Coalition). The goal of the Coalition is to support state legislation and legislators who seek to lessen the financial burden of critical treatments to patients.

Currently, the most promising of these initiatives is Assemblyman Dan Benson’s bill, A-2337, which requires health insurers to limit patient cost sharing and provide an appeal process concerning certain prescription drug coverage. The Coalition will be on hand at the state house in Trenton on February 22, 2016 to urge the Assembly Financial Institutions and Insurance Committee to support this critical legislation and refer the bill out of committee for full consideration by the Assembly.

The Issue: High Cost Sharing is a Barrier to Care

For many years, insurers have used tiered cost-sharing in their drug coverage as a way to encourage patients to try lower cost medications before turning to more expensive ones. Traditionally, costlier options would appear on the second or third tier of a health plan’s drug formulary – the list of medications covered by the plan – and the patient would pay a flat copay that increased moderately with each tier. Today, however, it is common for formularies to include a fourth, fifth, or even higher tier, where the cost share is often a percentage of the actual cost of the medicine, rather than a flat copay. Known as coinsurance, this type of cost sharing can require a patient to pay as much as 50% of a medication’s cost, which can translate to thousands of dollars in cost sharing for just a one-month supply of a medication.

These higher tiers – usually referred to as specialty tiers – have come to include a significant number and range of medications, including drugs that have no generic or cheaper equivalent. Another emerging trend is for the highest-cost tier to contain all the medications available for a certain condition; for patients needing one of these treatments, even a generic option will involve a high cost-share.[i] Making this problem even worse is the growing prevalence of high deductibles. This year, in health plans sold through the state marketplaces, the average combined deductible in bronze plans is $5,249 and, in silver plans, $2,658.[ii] Commonly these plans require consumers to meet their full deductible before any coverage is provided.[iii]

Typically, specialty tiers contain medications taken only by 1-5% of the patient population.[iv] These patients face diseases and conditions that – while relatively limited in incidence – are usually chronic, debilitating, and/or often life-threatening. This includes: cancer, multiple sclerosis, epilepsy, rheumatoid arthritis, HIV/AIDS, hemophilia, and other rare diseases. By requiring these patients to shoulder a disproportionate share of the cost of their medications, the specialty tiers’ benefit design singles out these patients, thus negating the reason they had been paying for insurance in the first place, which is to be protected from financial hardship in case of a serious illness.

This benefit design is not only unfair; it is also potentially harmful to patient health. High cost sharing has been shown to lower medication utilization and adherence,[v] leading to poor health outcomes and to an increase in longer term costs associated with treating disease progression or other complications. According to several studies, prescription abandonment rates increase significantly when patient cost sharing exceeds $100.[vi] Perhaps it’s not surprising then that drug adherence is a problem estimated to cost the US $290 billion annually.[vii]

The Solution: Reasonable Limits on Out-of-Pocket Costs

We believe that A-2337 offers a straightforward solution to this issue; depending on a health plan’s level of coverage, the patient cost share for a 30-day supply of a medication would be limited to $100 or $200. These limits would apply pre-deductible—meaning, these limits would be applied to a patient’s out-of-pocket cost regardless of whether the patient has satisfied the plan deductible. Otherwise, when patients fill their prescriptions each month, those with higher deductibles are unlikely to experience any improvement in the affordability of their cost share.

How our New Jersey Members can help

We encourage New Jersey Life Raft Group members to become involved in this important advocacy issue by either writing or calling your Assembly representative to voice your support for this legislation (phone and email scripts provided below), joining us at the state house in Trenton for the February 22 meeting and/or contributing your personal experience with high out of pocket drug costs and the impact it has had.

[i] Jacobs, D.B. and Sommers, B.D. “Using Drugs to Discriminate — Adverse Selection in the Insurance Marketplace.” New England Journal of Medicine. January 2015. 372: P399-P402. Available online at: http://www.nejm.org/doi/full/10.1056/NEJMp1411376

[ii] Avalere PlanScape® for 2015, a proprietary analysis of exchange plan features, December 2014. Avalere analyzed data from the FFM Individual Landscape File released November 2014 and the California and New York state exchange websites.

[iii] Breakaway Policy Strategies and Robert Wood Johnson Foundation. “Eight Million and Counting: A Deeper Look at Premiums, Cost Sharing and Benefit Design in the New Health Insurance Marketplaces.” May 2014. Available online at: http://www.rwjf.org/en/research-publications/find-rwjf-research/2014/05/eight-million-and-counting.html

[iv] Employer Health Benefits 2013 Annual Survey. The Kaiser Family Foundation and Health Research & Educational Trust. Aug. 20, 2013. Available at http://kff.org/report-section/2013-summary-of-findings/

[v] Roebuck, et al. “Medication Adherence Leads to Lower Health Care Use and Costs Despite Increased Drug Spending.” Health Affairs January 2011. 30:1

[vi] Streeter, S.B., Schwartzberg, L., Husain, N., Johnsrud, M. “Patient and plan characteristics affecting abandonment of oral oncolytic prescriptions.” American Journal of Managed Care. 2011. 175 (5 Spec No.): SP38-SP44.

[vii] New England Health Institute. “Poor Medication Adherence costs $290 billion a year.” 2009.

Phone and Email Scripts

Assemblyman Craig J. Coughlin (D19), Chair
Phone: 732-855-7441
Email: AsmCoughlin@njleg.org
Address: 569 Rahway Avenue, Woodbridge, NJ 07095

Assemblywoman Pamela R. Lampitt (D6), Vice Chair
Phone: 856-435-1247
Email: AswLampitt@njleg.org
Address: 1101 Laurel Oak Road, Suite 150, Voorhees, NJ 08043

Assemblyman Robert Auth (R39)
Phone: 862-248-0491
Email: AsmAuth@njleg.org
Address: 1069 Ringwood Avenue, Suite 312, Haskell, NJ 07420

Assemblywoman Marlene Caride (D36)
Phone: 201-943-0615
Email: AswCaride@njleg.org
Address: 613 Bergen Boulevard, Ridgefield, NJ 07657

Assemblyman Jack M. Ciattarelli (R16)
Phone: 908-450-7064; Email: AsmCiattarelli@njleg.org
Address: 50 Division Street, Suite 200, Somerville, NJ 08876

Assemblyman Joe Danielsen (D17)
Phone: 732-247-3999
Email: AsmDanielsen@njleg.org
Address: 334 Elizabeth Avenue, Somerset, NJ 08873

Assemblywoman Joann Downey (D11)
Phone: 732-695-3371
Email: AswDowney@njleg.org
Address: 802 West Park Avenue, Suite 221, Ocean Twp., NJ 07712

Assemblyman Reed Gusciora (D15)
Phone: 609-571-9638
Email: AsmGusciora@njleg.org
Address: 144 West State Street, Trenton, NJ 08608

Assemblywoman Amy H. Handlin (R13)
Phone: 732-383-7820
Email: AswHandlin@njleg.org
Address: 225 Route 35, Suite 202, Red Bank, NJ 07701

Assemblyman Joe Howarth (R8)
Phone: 609-654-1498
Email: AsmHowarth@njleg.org
Address: 176 Route 70, Suite 13, Medford, NJ 08055

Assemblyman Joseph A. Lagana (D38)
Phone: 201-576-9199
Email: AsmLagana@njleg.org
Address: 205 Robin Road, Suite 222, Paramus, NJ 07652

Assemblyman John F. McKeon (D27)
Phone: 973-377-1606
Email: AsmMcKeon@njleg.org
Address: 250 Main Street, Madison, NJ 07940

Assemblywoman L. Grace Spencer (D29)
Phone: 973-624-1730
Email: AswSpencer@njleg.org
Address: 223 Hawthorne Avenue, Newark, NJ 07112

Phone script:

Hello my name is_______________________________________________________

I am calling you today from_______________________________________________

With new and innovative treatments, diseases that were once considered fatal are now able to be treated and life expectancies continue to rise.

But today, under many health insurance plans, patients living with serious and life-threatening diseases must pay thousands of dollars in out-of-pocket costs to access the treatments their health care providers have prescribed.

When cost-sharing becomes a barrier to access, patients find themselves facing difficult decisions about whether to take medically-necessary treatments or to risk the family’s financial stability.

Thankfully, Assemblyman Dan Benson has led the effort to bring relief to patients struggling to overcome this access barrier, through Assembly Bill 2337. This bill requires health insurers, under certain policies or contracts that provide coverage for prescription drugs, to place limitations on a patient’s cost sharing for prescription drugs

Assembly Bill 2337 is an important legislative initiative for all patients and I am calling to ask for both your support, and your consideration to co-sponsor this important legislation to restore patients’ rights.

Thank you for taking the time to listening to my concerns and I hope I can count on your support.

Email:

Dear (Assemblyman/Assemblywoman):

With new and innovative treatments, diseases that were once considered fatal are now able to be treated and life expectancies continue to rise.

When cost-sharing becomes a barrier to access, patients find themselves facing difficult decisions about whether to take medically-necessary treatments or to risk the family’s financial stability.

Assembly Bill 2337 is an important legislative initiative for all patients and I am emailing to ask for both your support, and your consideration to co-sponsor this important legislation to restore patients’ rights.

Thank you in advance for your support.

Regards,

(Your Signature)