Federal Court Strikes Down “Copay Accumulator” Rule that Let Insurers Charge Patients More for Drugs

D.C. District Court Ruling Means Health Insurers Must Now Count Copay Assistance

Washington, D.C., October 2, 2023 – The U.S. District Court for the District of Columbia struck down a 2021 federal rule on Monday that allowed health insurers to not count drug manufacturer copay assistance towards a beneficiary’s out-of-pocket costs. The ALS Association is part of a coalition of patient advocacy organizations supporting the effort to end “copay accumulator” policies.

“This is a major victory for people living with ALS and their families, many of whom have been forced to pay thousands of dollars more as a result of these predatory policies,” said Melanie Lendnal, Senior Vice President of Advocacy for the ALS Association. “We are grateful to everyone who has been working tirelessly to ensure today’s result.”

“Copay accumulator” policies allow health insurers to pocket the copay assistance patients receive, rather than allowing it to count toward deductibles. The policies mean that all patients, including people living with ALS, end up paying more for prescription drugs.

A Health and Human Services 2021 Notice of Benefit and Payment Parameters authorized these practices. In its decision, the D.C. District Court struck down that rule. Insurers will now have to abide by the federal rule that governed 2020 health plans. Under that rule, copay accumulators are permissible only for branded drugs that have a generic equivalent, if allowed by state law. Now, insurers are precluded by federal regulation from implementing copay accumulators for drugs that lack generic equivalents.

Since 2022, the ALS Association has been on the frontlines advocating against copay accumulator policies at the federal and state levels. The organization is actively involved in 55 bills prohibiting the utilization of copay accumulator practices, 11 of which have been signed into law.

A link to the Court’s opinion can be found here while the final order can be found here.

About ALS
Amyotrophic lateral sclerosis (ALS) is a progressive neurodegenerative disease that afflicts approximately 27,000 people in the United States and a comparable number of patients in Europe. Approximately 6,300 new cases of ALS are diagnosed each year in the United States. The average life expectancy of a person with ALS is approximately two to five years after diagnosis and only approximately 10 percent of people with ALS survive for more than 10 years. Death is usually due to respiratory failure because of diminished strength in the skeletal muscles responsible for breathing. Few treatment options exist for these patients, resulting in a high unmet need for new therapies to address functional deficits and disease progression.

About The ALS Association
The ALS Association is the largest philanthropic funder of ALS research in the world. The Association funds global research collaborations, assists people with ALS and their families through its nationwide network of certified clinical care centers, and advocates for better public policies for people with ALS. The ALS Association is working to make ALS a livable disease while urgently searching for new treatments and a cure. For more information about The ALS Association, visit our website at www.als.org.