Obamacare Hikes Cost to Patients of Specialty Drugs for Complex Conditions


Lady of Procrastination

Users of "specialty drugs"—high-cost medications used to treat complex conditions such as multiple sclerosis—are likely to face a case of sticker shock if they sign up for one of the Obamacare Exchange health plans. The plans require users to pay coinsurance, a percentage of medication costs. While that percentage varies with specific plans and with the "metal" level of the plan, that's expected to raise patients' out-of-pocket payments higher than most are accustomed to paying.

According to Caroline F. Pearson, vice president of the consulting firm, Avalere Health:

In most exchange plans, consumers will face paying a percentage of the costs—known as coinsurance—rather than fixed-dollar copayments for many specialty medications used to treat rare and complex diseases.

According to a new Avalere Health analysis, some plans require enrollees to pay 50 percent of the specialty drug's cost. …

Specifically, 59 percent of Silver plans on exchanges across the nation use coinsurance for consumer cost-sharing on the specialty tier. Among Silver plans, the analysis also found that 23 percent of plans have coinsurance rates of 30 percent or more on the highest formulary tier. Sixty percent of lower-premium Bronze plans apply specialty tier coinsurance greater than 30 percent of the drug price. By contrast, only 38 percent of Platinum plans require coinsurance.

What that could mean, specifically, was pointed out by HealthPocket, which rates health plans. An article published last summer pointed out, "When compared to the current individual and family health insurance market, both the entry-level Bronze Plan and the higher tier Silver Plan will increase most out-of-pocket drug costs for consumers." Using Copaxone, a drug used to treat multiple sclerosis, as an example of a specialty medication, HealthPocket warned that "someone on the Bronze plan would have spent the $6,350 annual limit on out-of-pocket costs by the fourth month of coverage."

Copaxone costs

Purchasing a gold or platinum plan can bring medication costs down, at the cost of higher premiums—and consumers are already complaining about higher than expected premiums, deductibles, and other costs.

Additionally, the Affordable Care Act requires only one drug per category and class be covered within a health plan formulary, that drug to be selected by an insurer, and off-formulary medications aren't covered at all. That can mean limited options as well as high costs for consumers who may well have been forced by the law off a plan that served them better.

NEXT: What Can Satellite Night-Time Photos Tell Us About the State of Global Poverty?

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. Obamacare destroys the economy. No news at 11:00.

  2. It’s cool…with the money the government saves….next year….upgraded OBAMAPHONES for everybody!

    1. Not everyone, just 47%

  3. Obamacare hikes cost

    Could have stopped right there.

  4. Is there anything Obamacare can’t do?

    1. save money?

  5. Wasn’t there an abortion thread somewhere around here?

    1. That thread was aborted. Sex selection I think.

    2. It went into Cosmotarian.com instead of remaining here at Paleo.com.

      1. Cosmotarian.com has the banners for Classic Bacardi Cocktails, right?

        1. Please stop taunting it!

          It doesn’t understand that it is being mocked!

          1. Lay some more absurd CT on us, tarran. Reach far into your ass to outdo the last batch of nonsense you thought of please.

        2. And Paleo.com has PBR ad banners.

          The two groups will never meet as one.

  6. Same shmoes who used to turn up at ERs and get treated for free are now paying their Obamacare premiums. Right?

  7. I have been assured that this is a lie perpetrated by the Koch brothers. Obamacare is everything you ever wanted with a cherry on top.

    1. The cherry, of course, is taxed.

      Unless it is a black cherry. There’s a waiver there.

      1. straight up racist.

        1. It’s not racist to give a preference to minority fruits.

          1. Racist homophobe.

          2. This is why there are no gay, libertartian, minority females.

  8. I know someone who’s paid over $1,200 a month for simple colitis medication. If you live near the border with Mexico, you can buy medication from respectable hospital pharmacies there for a fraction of what they cost here in the U.S. Because they don’t have Medicare and Medicaid, like we do, the cost of medication is more a function of market forces…

    I’ve seen the same name brand medications that cost $1,200 a month in the U.S. go for $250 a month in Mexico.

    You can often get medications for less than half the price we pay in the U.S. from pharmacies in Canada, too. One of the reasons those online pharmacies get so much business is because it can cost less to buy in Canada than the co-pay Medicare and Medicaid patients have to fork over! Even in Canada–EVEN IN CANADA–they’re not so dumb as to make hospitals and providers write off half the cost of the patients they treat and gouge private pay patients for the difference.

    Some people find it hard to believe that forcing providers, effectively, to give away half their products and services for free can create market distortions. They think market distortions are just something Reagan made up because he hated AIDS patients and the homeless. Those people are dumber than retards, and I’m pretty sure Barack Obama is one of them.

    1. I remember some GOP legislation that made illegal pharma re-importations from Canada. Part of Medicare Part D.

      OOOPS! I mentioned Bush. NO FAIR!!!!!

      1. What are you talking about and why?

        Do you think I’m a fan of Bush?

        I spent all of his presidency (at least since Hit & Run started) denouncing both Bush and his policies as painfully stupid–every single damn day–right here at Hit & Run…

        So, why are we talking about Bush?

        Is it because I said something about Reagan? Are you one of those people that thinks Medicare, Medicaid, and Obama’s stupid ObamaCare don’t create market distortions? Are you dumber than a retard?

        Did something I say offend you?

        Why are you talking about Bush?

        1. Are you dumber than a retard?

          I trust this was a rhetorical question.

      2. Are you one of those people, Shrike, who thinks Reagan made up “market distortions” because he hated AIDS patients and the homeless?

        1. Ken,

          By now surely you realize it isn’t sentient right?

          It’s like that CPM 80 program, Eliza; it automatically spits out streams of words in order to elicit a response. It neither understands what it is typing or what people responding to it are saying.

          It merely craves the reward of having a person acknowledge its existence.

          Asking it questions is a futile waste of time. It can’t tell you what it is thinking because it is no more capable of thought than an earthworm.

          1. Sometimes it’s fun to poke at it with a stick.

    2. Today in the breakroom, a bunch of people were complaining about lengthening wait times to see their doctors.

      The topic of wait times was initiated by a person who had had to wait till 10AM before the doctor walked into the examining room, for a 9AM appointment. Everyone agreed that what hospitals and clinics needed to do was hire more doctors so that they would have extra capacity to deal with emergencies. There was bafflement as to why these companies weren’t doing that.

      I finished nuking my soup and left without a word; I am too weary to argue with people about this anymore.

      1. This is what happens when people spend now two generations telling people that economics is so complex you need a PhD to understand it. This is like saying that physics is so complex you need a PhD to understand it. For 99.9% of what a person will experience, answering the question “what hampers the efficient transaction between two (or more) parties who want to exchange resources they value differently?” tells you why something is changing to make the wait-time longer, quality less, or cost higher. Much in the same way answering “what forces must be acting on that object for that object to move in that manner” will answer 99.9% of the physics questions a person who doesn’t hold a PhD in physics will encounter.

      2. I saw a sign in my doctor’s office, last time I was there, saying that for a brief time, he was accepting new patients.

        There’s this thing called “consequences”.

        1. “I am accepting new patients from 3:31 AM to 3:46 AM on February 29, 2016. First come, first served.”

  9. Shocked face. This is mine.

    You may now return to your normal activities.

  10. This is of course, all lies, lies, lies because Harry Reid said so. In fact, my diabetic friend up the hallway was telling me these same lies. He was so excited when Obamacare came out because his wife was no longer job-locked into a job so that he could get medical insurance. She quit when the law came into effect, and he signed up for a Platinum plan. Even though he is an accountant, he was shocked to discover that he is now paying more for insurance and his meds than he was before the affordable care act. He seems sincere when he tells me this, but I know he must be subject to FoxNews mind control when he tells me these lies.

    1. I work with someone who was shocked (shocked!) that his individual plan premiums went up so much. He was going to write to Nancy Pelosi to complain. I don’t know for sure, but chances are he’s a loyal Democratic voter. I’m sure there are lots of people like that. I don’t see how Obamacare is going to be anything but devastating to Democrats in November and in 2016. Many of their voters are ticked off, lots of independents are, and Republicans are champing at the bit to vote.

  11. I have tried explaining the issue of state insurance-plan formularies to people, and how the ACA replaced diverse plan-options (which serviced people with rare and chronic conditions like MS) with a SINGLE state formulary-plan for all insurers – a measure intended to reduce costs, but one which is medically inappropriate given the myriad ways actual patient afflictions manifest themselves, and the variety of treatment types used for any given condition.

    I essentially simplified it as “Obamacare is imposing “one-size-fits-all” on people with rare and chronic illnesses”

    The reaction to this was, “Well, they’re still going to get things *cheaper* and will be protected from being dropped!” –

    I tried to point out that ‘getting dropped’ wasn’t usually the problem for most, as they often paid large amounts for specific specialty plans already. The issue for people like this is that now *they have no options*. People on specialty drugs are basically screwed.

    People who pontificate about the moral superiority of the ACA simply have no idea what the fuck they are talking about. That attitude is simply only possible with a willful ignorance of the nuts and bolts of how this particular ‘market’ functions. They don’t know *who* the thing actually is really helping, but they are utterly certain *its worth it*. they must assume that what with all these eggshells, SOMEONE must be getting an omelet somewhere.

  12. Here’s a forbes story from December on this issue =


    I first started learning about this in Nov last year, partly because clients of mine have a number of holdings in specialty pharma companies and wanted to know how this was going to affect the markets for specific treatments. its a fucking mess. I have a few acquaintances who suffer from chronic illnesses and some have said they may be moving to different states simply to get access to their existing medications. In some cases they can’t get it *at all*. and its nearly goddamn impossible to get simple and clear info on what the situation is for different plans on drug availability and real end costs.


    “As another excellent analysis finds, a lack of standardization and on-line tools makes it hard for consumers to compare between plans.

    Some of the published lists do not show all of the covered drugs. For instance in California, Blue Shield’s document states that only the most commonly prescribed drugs are shown in its published formulary. Anthem’s published list is also not comprehensive.

    Some analysts have tried to look across the plans, but comparisons are as hard for experts to make as they are for consumers.”

  13. The makers of copaxone offer copay assistance that brings the actual out of pocket down to $35 a month. No joke. No forms to fill out, no financial requirements. Just call and ask for it.

    crazy, but true. Search on “shared solutions”

    1. The offer is not valid for patients covered in whole or in part by Medicaid, Medicare, TRICARE, or any other federal or state government pharmaceutical assistance plan or program (regardless of whether a specific prescription is covered), or by private health benefit programs that reimburse for the entire cost of prescription drugs. Use of this offer must be consistent with the terms of any drug benefit provided by a health insurer, health plan, or private third-party payor. This offer is void where prohibited by law, taxed, or restricted. No additional purchase is required. This offer is valid only at participating pharmacies and may be changed or discontinued at any time without notice. This program is not health insurance.

      I’m sure its helpful for some, but its hardly a universal solution. Don’t underestimate the number of health plans that require payment of co-pays in full (its how they manage demand), and will only waive them on a showing of financial need. Also, it may not a “co-pay” if you haven’t met your deductible, so even if you qualify, if you have a high-deductible plan you may pay full boat until your deductible is satisfied.

  14. I’m a chronic disease patient myself (though from Australia not the US) – I’m in my 20’s and suffer from arthritis, and as a result, chronic pain.
    One of the painkillers my doctor tried me on was Tramadol, which while it did reduce my pain levels, made me constantly nauseous. Under the ACA plan I wouldn’t have had an alternate option – but no problem here, just prescribe the standard anti-nausea drug! Well that’s actually exactly what my doctor did, and after that anti-nausea drug didn’t work he tried me on 4 or 5 others, none of which worked either… Fortunately after that I was switched onto a different (more restricted) opiate though this required me to visit the doctor every 2 weeks (now after a year it’s gone to every month!) to ask permission to buy the medications I need.

    As you may have heard in the current debate around health care costs, many medications in Australia are subsidised (though not all). With my pills the price is brought down to approximately the same as the unsubsidised price in Canada where the government granted patents have already expired – one government intervention to solve the problems caused by the previous one…

Please to post comments

Comments are closed.