By Kate Greenwood
Cross-Posted at Health Reform Watch
At the end of last month, the Secretary of Health and Human Services Kathleen Sebelius made headlines when, in a letter addressed to Representative Jim McDermott (D-WA), she announced that “[qualified health plans], other programs related to the Federally-facilitated Marketplace, and other programs under Title I of the Affordable Care Act” were not “federal health care programs under section 1128B of the Social Security Act”. One implication of the Secretary’s interpretation is that the “anti-kickback act”, which is found in Section 1128B, does not apply to qualified health plans. And that, in turn, means, among other things, that individuals insured under those plans, unlike individuals on Medicare or Medicaid, will be able to use drug company coupons to defray the cost of their prescription drugs.
Prescription drug coupons have been a source of controversy, favored by branded manufacturers and patients, and opposed by generic manufacturers, health insurers, third party payers, and pharmaceutical benefit managers. Joseph Ross and Aaron Kesselheim studied a large number of coupons advertised on the website www.internetdrugcoupons.com and found that “62% (231 of 374) were for brand-name medications for which lower-cost therapeutic alternatives were available.” Ross and Kesselheim argue that the coupons are costly at the population level, but also for individual patients. This is because the coupons are nearly always time-delimited and the short-term savings do not typically outweigh the long-term cost of taking a branded drug. On the other hand, in an article in last week’s JAMA, Leah Zullig and colleagues pointed out that reducing co-payments has been proven to improve medication adherence, a problem which there “is an increasing business case for addressing[.]”
The coupon controversy has carried over into the courts. On March 7, 2012, seven lawsuits were filed in district courts by third party payers against a number of drugmakers, alleging that prescription drug coupons violate antitrust, commercial bribery, and racketeering laws. (This post at FDA Law Blog includes links to the seven complaints, and this one provides an update on the status of the litigation as of late June 2013.)