Insights

New Law Prohibiting Drug Copay Accumulator Programs Takes Effect on January 1, 2022


Kentucky is one of several states that enacted a law to require the amount of a drug manufacturer’s financial assistance (e.g., coupon, discounts, or vouchers) to count toward an enrollee’s cost-sharing, such as an out-of-pocket maximum, deductible and copay. The law’s implementation date is January 1, 2022, and it intends to prohibit “copay accumulator programs” in an effort to protect consumers.

Copay accumulator programs are sometimes implemented by insurers and PBMs in order to exclude prescription drug manufacturers’ coupons and other forms of financial assistance from counting toward a health plan enrollee’s annual cost-sharing limit, which disadvantages enrollees.

Besides Illinois, Kentucky was the only state to recognize that their law that prohibits copay accumulator programs conflicts with the federal law’s qualified HDHP/HSA eligibility rule. The federal rule states if an enrollee receives the drug manufacturer’s financial assistance before satisfying the enrollee’s annual deductible, the enrollee becomes ineligible to contribute to their HSA. In light of this, the state issued guidance (Bulletin 2021-002) to clarify that the state’s copay accumulator programs prohibition bill does not apply to qualified HDHPs when they are coupled with an HSA.

Therefore, insurers and PBMs are required to count prescription drug manufacturers’ financial assistance towards enrollees’ cost-sharing when a plan is not a qualified HDHP/HSA and issued in Kentucky.

Kentucky Senate Bill 45 »
Bulletin 2021-002 »