On August 26, 2019, the Departments of Health and Human Services (HHS), Labor, and the Treasury (collectively, the Departments) jointly announced that they will not enforce HHS’s recently finalized policy that limits private health plans’ use of accumulator programs — i.e., programs that exclude the value of direct manufacturer cost-sharing support (such as co-pay coupons) from patients’ annual cost-sharing limits — to prescription brand drugs for which a medically appropriate generic equivalent is available.
The Departments concluded that the policy conflicts with existing Internal Revenue Service (IRS) guidance that requires high-deductible health plans (HDHPs) to exclude all drug and manufacturer discounts when calculating patient contributions toward plan deductibles. The Departments will address this conflict by permitting health plans to use accumulator programs and exclude the value of manufacturer coupons from annual cost-sharing limits — regardless of whether medically appropriate generic equivalents are available — until a revised policy is issued for the 2021 plan year.
Sidley Austin LLP provides this information as a service to clients and other friends for educational purposes only. It should not be construed or relied on as legal advice or to create a lawyer-client relationship. Readers should not act upon this information without seeking advice from professional advisers.
Attorney Advertising—Sidley Austin LLP, One South Dearborn, Chicago, IL 60603. +1 312 853 7000. Sidley and Sidley Austin refer to Sidley Austin LLP and affiliated partnerships, as explained at www.sidley.com/disclaimer.
© Sidley Austin LLP