Dear Honorable Members of the Senate Commerce and Labor Committee:
On behalf of the over 800 people living with cystic fibrosis in Tennessee, we write to express our support for SB 2008 which would limit the proliferation of problematic coverage programs known as maximizers and alternative funding programs (AFPs). This bill will help support access to affordable care for people with cystic fibrosis.
About Cystic Fibrosis
Cystic fibrosis is a progressive, genetic disease that affects the lungs, pancreas, and other organs. There are close to 40,000 children and adults living with cystic fibrosis in the United States, and CF can affect people of every racial and ethnic group. CF causes the body to produce thick, sticky mucus that clogs the lungs and digestive system, which can lead to life-threatening infections. Cystic fibrosis is both serious and progressive; lung damage caused by infection is irreversible and can have a lasting impact on length and quality of life. As a complex, multi-system condition, CF requires targeted, specialized treatment and medications. While advances in CF care are helping people live longer, healthier lives, these treatments only matter if they are accessible to the people who need them.
Maximizer and Alternative Funding Limitations
SB 2008 would limit the proliferation of new coverage arrangements with third-party entities known as maximizers and alternative funding programs. Maximizers often outsource a patient’s drug coverage to a third-party entity that sets the patients’ cost-sharing at a level to maximize use of manufacturer copay assistance. Alternative funding programs are third-party entities that seek to enroll patients in manufacturer patient assistance programs that provide free drugs, which are usually intended for people without insurance. In these instances, patients are usually forced to enroll in these third-party programs or forgo coverage for their drug entirely.
Both of these programs add administrative burden, confusion, and sometimes financial challenges for people with CF trying to get critical medications. Since these programs are run by third-party entities, patients are confused about the role of these organizations and how they are involved in their drug coverage. They also add additional layers of bureaucracy and paperwork that people must navigate and ultimately, if the patient chooses not to enroll, leave patients vulnerable to significant out-of-pocket costs.
SB 2008 would limit the proliferation of these programs in state regulated health care plans by prohibiting insurers from altering benefit designs based on the availability and amount of financial assistance for a drug. While this is an important protection, the legislation could be strengthened by applying this prohibition to “third-party entities” instead of “third-party administrators” as defined in Tennessee Code § 56-7-2902. The existing definition referenced in code may not capture maximizer and AFP programs, as they are not traditional third-party administrators that collect premiums or process claims. Instead, this section of SB 2008 must apply to all entities that contract with health plans and are involved drug benefit design and enrollment.
We understand the challenge insurers face in managing the rising cost of drugs, and that copay and patient assistance programs mask bigger cost and affordability issues in the health care system. However, cost containment strategies that further burden patients are unacceptable. Maximizers and AFPs can impose significant barriers to care for people with CF and we support legislation to limit their further expansion.
The Cystic Fibrosis Foundation appreciates your attention to this important issue for the CF community in Tennessee.