May 23, 2018 at 9:09 am EDT | by Lou Chibbaro Jr.
HIV groups urge states to investigate reduced coverage of AIDS drugs
Carl Schmid, AIDS drug price gouging, Hep C, drug, Gilead, the AIDS Institute, gay news, Washington Blade

Carl Schmid, deputy director of the AIDS Institute, said state officials have begun to respond to the HIV coalition’s concerns. (Photo courtesy of Schmid)

A coalition of 60 HIV organizations from across the country is calling on insurance commissioners and attorneys general in all 50 states and D.C. to investigate a practice they say is being adopted by health insurers that’s resulting in excessively high out-of-pocket costs for AIDS and Hepatitis C drugs.

In a May 16 letter to all state insurance commissioners and attorneys general, the Federal AIDS Policy Partnership, of which the 60 HIV groups are members, said health insurance companies and pharmacy benefit managers, known as PBMs, have begun refusing to allow drug manufacturers’ co-pay assistance contributions from counting toward the patients’ insurance deductible.

The coalition points out in its letter that co-pay assistance from drug manufacturers through payment coupons or payment cards enables HIV patients and HIV negative people on the HIV prevention drug regimen known as pre-exposure prophylaxis or PrEP to save thousands of dollars a year on their share of the costs of the drugs through their insurance plans.

It says the sudden decision by many insurers to no longer allow co-pay assistance from the drug manufacturers to go toward the insurance deductible, which can shave off $4,000 or more a year for the consumer on the AIDS and PrEP drug Truvada, could force patients or those enrolled in PrEP to either pay thousands of dollars a year more in out-of-pocket co-payments or to discontinue taking the drugs.

An official with Whitman-Walker Health, the D.C.-based community health provider, said that terminating the co-pay assistance from going toward some Whitman-Walker clients’ insurance deductible has resulted in their being hit with a $1,600 per month out-of-pocket cost for PrEP.

“Plans are implementing these policies with no consumer notice, leaving consumers to find out that this policy is in place after they incur steep prescription drug cost sharing mid-year,” the FAPP coalition states in its letter.

“These policies are unfair to the consumer and will have significant individual and public health consequences,” the letter states.

The letter notes that insurers have argued that the drug manufacturers are responsible for setting what the insurers say are excessively high drug prices to begin with and that the co-payment assistance plans offered by the drug companies have been used to “steer” patients toward choosing name brand drugs rather than less expensive generic drugs.

But the FAPP coalition members point out in their letter that for nearly all currently prescribed AIDS drugs, including Truvada used for PrEP, there is no generic alternative available.

“Without the co-pay assistance, most people living with HIV will be unable to afford their treatment throughout the plan year, and individuals trying to protect themselves from HIV will be left at greater risk of acquiring the virus,” the letter states.

“We urge you to immediately undertake an investigation of these damaging practices,” the letter says. “Patients are already facing difficulties in affording their medications. This new practice will compound the situation.”

Among the 60 organizations that signed the coalition letter are the D.C.-based AIDS United and National Minority AIDS Council; the AIDS Institute; the AIDS Healthcare Foundation; the Los Angeles LGBT Center; the National Black Gay Men’s Advocacy Coalition, which advocates for AIDS related issues; and the National Latino AIDS Action Network.

Philip Barlow, Associate Commissioner for Insurance at the D.C. Department of Insurance, Securities and Banking, told the Washington Blade that the department has received the coalition’s letter.

“I have asked our staff to do some research on the issue, including identifying if we have received any complaints,” Barlow said. “We will consider next steps based on the results of our review,” he said.

Carl Schmid, deputy director of the AIDS Institute, who’s serving as a spokesperson for the coalition, said state officials have begun to respond to the coalition’s May 16 letter.

“We have received many responses from different states offering to look into the situation,” Schmid told the Blade. “I received some phone calls and some emails, thanking us for pointing out the situation and promising to look into it,” he said.

Officials representing the health insurance industry and the drug manufacturers, meanwhile, have blamed each other for the skyrocketing costs of prescription drugs, especially AIDS drugs.

Kristine Grow, Senior Vice President for Communication for America’s Health Insurance Plans (AHIP), the trade association representing the health insurance industry, told the Blade AHIP considers the manufacturers’ co-payment assistance coupons a gimmick to justify what she said is the unreasonably high costs for their drugs.

“They have offered co-pay coupons and we see those as more of a scheme to keep their list prices high unnecessarily,” Grow said. “And our position is that these drugs people rely on for their care should be affordable in the first place,” she said. “If they can afford to have those drugs available for that coupon price why not lower the price for everyone? Why do we need to play games with the coupon?”

A spokesperson for the Pharmaceutical Research and Manufactureres of America, known as PhRMA, which represents the drug industry, did not respond to a request by the Blade for comment.

But on its website PhRMA says that the “middlemen,” including insurance companies and pharmacy benefit managers, are responsible for the high cost of drugs that the consumer pays.

“While biopharmaceutical companies set the list price for a brand medicine, more than one-third is rebated back to payers and the supply chain,” the group says on its website. “Insurers negotiate large rebates, but do not share these discounts with patients who pay a deductible or co-insurance,” the website statement says.

“Ultimately your insurer determines what you pay for your medicine out of pocket,” it says, adding, “No patient should pay more for their medicine than their insurer.”

The statement praises the drug manufacturers’ co-payment coupon programs as a “valuable source of assistance for many commercially insured patients who are facing rising out-of-pocket costs because of their insurance coverage.”

Lou Chibbaro Jr. has reported on the LGBT civil rights movement and the LGBT community for more than 30 years, beginning as a freelance writer and later as a staff reporter and currently as Senior News Reporter for the Washington Blade. He has chronicled LGBT-related developments as they have touched on a wide range of social, religious, and governmental institutions, including the White House, Congress, the U.S. Supreme Court, the military, local and national law enforcement agencies and the Catholic Church. Chibbaro has reported on LGBT issues and LGBT participation in local and national elections since 1976. He has covered the AIDS epidemic since it first surfaced in the early 1980s. Follow Lou

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