Can’t see the audio player? Click here to listen.
Lillian Karabaic teaches personal finance to millennials through a podcast and community called Oh My Dollar! — and she needs an expensive drug to treat a chronic condition. That makes her an expert on one of the most complex arrangements in the American health care system: the copay accumulator.
In short, it’s an invention by the insurance industry to make sure only your money counts toward your yearly deductible — not any assistance you might receive from a drug company.
Drug companies offer copay assistance to patients whose plans make them pay a percentage of a medicine’s price so that they charge insurers more. For instance, if a drug’s monthly cost is $10,000, few people with a 20% copay could afford $2,000 a month. But if the drug company helps you with that $2,000 — sometimes they call it a “coupon” — it can charge your insurer $8,000 a month. Copay accumulators say these coupons can’t count toward an insurance plan’s out-of-pocket maximum.
It’s confusing, but Karabaic was well aware of how it works. Still, she recently got socked with an unexpected $3,000 charge — and expects to lose her very organized fight against it.
Finding out whether an insurance plan includes one of these policies can be extremely tough. Researchers from the AIDS Institute looked at hundreds of plans across the country and developed a tip sheet to help guide searches. A dozen states have banned copay accumulators, and more are considering doing so.
For tips on how to avoid overpaying for drugs — when that’s possible — check out the latest edition of our First Aid Kit newsletter.
Here’s a transcript of the episode.
“An Arm and a Leg” is a co-production of KHN and Public Road Productions.
To keep in touch with “An Arm and a Leg,” subscribe to the newsletter. You can also follow the show on Facebook and Twitter. And if you’ve got stories to tell about the health care system, the producers would love to hear from you.
To hear all KHN podcasts, click here.
We encourage organizations to republish our content, free of charge. Here’s what we ask:
You must credit us as the original publisher, with a hyperlink to our khn.org site. If possible, please include the original author(s) and “Kaiser Health News” in the byline. Please preserve the hyperlinks in the story.
It’s important to note, not everything on khn.org is available for republishing. If a story is labeled “All Rights Reserved,” we cannot grant permission to republish that item.
Have questions? Let us know at [email protected]