My previous post warning that copay coupons may not count toward High Deductible Health Plan deductibles and out of pocket expenses is by far the most read and commented on entry in this blog. The obvious question is this: do affected patients have a legal remedy?  The short answer is: I do not know. Unfortunately, I could not represent anyone in such a legal dispute due the ethical and business concerns that would arise from my representation of health insurance companies on unrelated matters. Nor could I participate as a plaintiff because, fortunately, my benefits plan has not yet adopted this strategy.  But I can offer some thoughts on how such a legal challenge might proceed.

Keep in mind that this is not legal advice.  It is simply some high level legal information that will not apply to your specific and unique circumstances.

Discounting copay assistance coupons from deductibles and out of pocket may be a breach of contract.

The Main Argument: Breach of Contract regarding Copay Coupons

One commenter, Donna Busching, was already on the right track:

I called UHC, they said that was their policy starting 1/1/2018. I wanted to know where benefits said that. She couldn’t find it in online benefits. She said check you written benefits. (I don’t have them currently).

The contract between you and your insurance company governs your medical and prescription benefits. This is typically a one-to-two hundred page document that you probably have never read. You should obtain a copy of it from your employer’s HR/Benefits department. Once you have it, check the summary of benefits to ensure that prescription costs count toward your deductible, and then skip to the Prescription Benefits section and read carefully for any mention of copay coupons. Your goal is to not find language regarding copay coupons.

Your next step (or your first step if you are not comfortable scanning the contract yourself), is to involve a lawyer. You should seek out a well respected local lawyer with experience litigating against health insurance companies. While it is unlikely that he or she could take your case, even if it has merit [due simply to the economics], it could be a first step toward a referral to a firm with the resources to organize a class action and absorb the enormous litigation costs. In my opinion, the issue is a textbook example of an appropriate class action because, as your comments show, thousands to millions of consumers are affected.

Unfortunately, I cannot recommend any lawyers or law firms. I did, however, run the following search on Bing which resulted in a few relevant results: “class action lawsuits health insurance deductible copay assistance.”

If a lawyer or law firm were to take your case, the legal claim would be for breach of contract. The deductible shields the insurance carrier from the first several thousand dollars of claims. If there is no contract language to the contrary, it should not matter whether that obligation is satisfied by the member, a copay assistance coupon, or a loan from grandmother, as long as the patient meets his or her obligation of shielding the

Obamacare plans that discriminated against HIV patients with formulary placement settled after being sued.Another Argument: If you have an Exchange Plan (Obamacare)

Reports began to surface in 2014 that Humana, Cigna, and others were placing single-tablet HIV medications–the current standard of care demonstrated to be superior than “cocktails” of many individual pills, in the highest formulary tiers. This tier placement greatly increased the out of pocket costs to patients seeking the standard of care to which they were entitled. HIV patients argued that they were being unfairly discriminated against in access to medication, which was explicitly outlawed under the Affordable Care Act (Obamacare) for insurance plans sold on marketplace exchanges.

After the lawsuits were filed (but before any trial or ruling on the merits), the insurance companies relented and agreed to change their practices. Humana lowered its copay for the highest tier HIV medicines from 50% to 10%, and Cigna and Coventry reached similar agreements. While these examples are not legally binding, they do suggest that the plaintiffs’ underlying complaints had merit.


If you are affected by this issue, I think it is worth consulting with a lawyer who has experience litigating against health insurance companies. Come to your meeting armed with your full insurance contract and the details of your specific circumstances (your diagnosis, your required medications, the costs, whether this has been a problem before, what attempts you have already made to resolve the issue with the insurance company, etc.). Most attorneys will offer an initial consultation for free. Most respectable attorneys will, if they believe your claim has merit, take your case or refer you to another law firm with the resources and experience to handle your claim.

Who knows: You could start the next class action lawsuit on this issue.

*As I mentioned before, nothing in this article should be relied on as legal advice. I am providing information that may help you in when seeking your own attorney to discuss the specific details of your case.

Copay Coupons and Deductibles: Is Litigation a Possibility?

6 thoughts on “Copay Coupons and Deductibles: Is Litigation a Possibility?

  • Pingback: WARNING: Your copay assistance card may not count toward your deductible | The PozLawyer Blog

  • February 10, 2018 at 5:38 pm

    I think there may be another avenue for litigation on this issue. I agree that where the money comes from to meet the patient’s annual deductible and out of pocket maximum is none of the insurance company’s business. To carry their argument to an absurd extreme, if one had a wealthy uncle who was paying the bill, they can’t turn around and say the patient now has to make up an equal amount.

    I ALWAYS read my entire plan document every year, and I know exactly how my plan works. Knowing the information better than they do is the only way to have a fighting chance against these greedy bastards. You want to look for more than just mention of copay card or coupon. You also want to look for coordination of benefits, meaning are they getting into it if you happen to have secondary coverage. My plan does not coordinate benefits for prescription drugs, so if my plan were secondary, they would pay nothing. It’s not relevant in my case, since my coverage through my job is primary, as it’s the only coverage I have, and the copay card is not insurance.

    The idea that the insurance company would take this benefit from the patient is VERY problematic for another reason. The company that manages the copay card collects all sorts of data about YOU, the PATIENT. You have essentially SOLD your information in exchange for the money in question, and you FULLY CONSENTED to this, whether you knew you did or not. Your insurance company DOES NOT get to SELL your personal PROTECTED HEALTH INFORMATION for its benefit, and the insurance company is going to have to pay for 100% of your healthcare costs over and above the deductible and out of pocket maximum. That is what the contract says. Now, by taking YOUR copay assistance, the insurance company is not paying what it is supposed to. See, this little argument works both ways.

    I really think the best way to deal with this is to disengage, and I honestly believe this is better than pursuing litigation, which will be costly and time consuming. In the short term, litigation will not solve your problem. So, check with your copay assistance program, and see if you can pay the deductible and out of pocket maximum and then get reimbursed later. I know ViiV who makes Tivicay doesn’t allow this, but Gilead does. Clearly, I am more familiar with the HIV medication copay cards. If you can get reimbursed, insist on using a retail pharmacy. Under the ACA, an insurer CANNOT require you to use its mail order (read: specialty pharmacy) as of 2017 UNLESS the drug in question REQUIRES special handling. This is not the case for the vast majority of HIV and Hepatitis C drugs; I do not know about drugs for other conditions. Biologic agents may require special handling, for example.

    Beware– the insurance company will try to argue with you and say your medication is “specialty” based only on the cost. DO NOT accept this. The law is clear. File complaints with the DHHS if necessary. If they require you to use their mail order pharmacy, they are in violation of Federal law. I am aware of a case where CVS was mailing prescriptions from their mail order outfit to a retail loacation and then said they were not requiring mail order. I really believe this was an attempt to circumvent the law, but the patient in question didn’t feel like fighting it, and fortunately no longer has to deal with them. They can charge you more to use a retail pharmacy, but who cares? People with serious chronic conditions are going to pay the maximum regardless. It is a nonissue in the long run.

    Also be advised, you should avoid mail order whenever possible. Express Scripts, for example, will not take responsibility if a prescription is lost in the mail. It’s YOUR problem. Personally, I cannot afford to replace a $3,500+ prescription that gets lost in the mail and that my employer already paid for. Because the PBMs all refuse to take responsibility for the prescription once it enters the USPS, I’ve never used mail order since being on HIV treatment. I decided long ago I would do without treatment rather than put up with that crap.

    I feel for parents who have extremely ill children and must constantly fight to receive adequate care for their child. It is unconscionable. God bless Natalie Weaver for all her work, not just for her child, but ultimately for all of us.

    I am not an attorney, and I too cannot give legal advice. I can only share what I have learned in the process of dealing with my own issues.

    • February 10, 2018 at 6:13 pm

      I agree with everything in this comment. I neglected to mention the coordination of benefits language with respect to prescriptions. But I’m also not sure that would help the insurance company. The copay cards are essentially insurance, and they are designed to be secondary only. That’s why copay coupons are not available to people without insurance, and why they also require the claim to be run first through the primary insurance which then responds with the patient responsibility. The coupon pays only the amount given by the primary insurer after it adjudicated the claim (not the other way around). A COB provision in the health insurance contract making it secondary to copay assistance seems like it would still result in primary insurer liability because the copay card (per its own policy) would deny the claim,
      leaving the health insurance to process the claim at full value anyway without copay assistance. Now that I think about it, if health were secondary to copay coupon, there should be no way around crediting the patient responsibility to the deductible, since the copay card will literally never pay.

      From what I understand (anecdotally), this applies mainly to health insurance companies that also own or contract with the pharmacy (typically a specialty or mail order pharmacy). Think: ExpresScripts. That’s how they know about the copay card—the information is stored on file with the pharmacy that the carrier owns.

      Also my sense, anecdotally, is that this mostly affects fully insured rather than employer self funded plans. If you read the UHC comments that I linked to in my other post, you will notice that the “program” is locked in for fully insured plans and “available” for self funded plans to elect.

      Fully insured vs. self funded is a whole separate conversation beyond the scope of this post. In a nutshell: most large employers pool employee premiums and employer contributions into a trust that pays for claims, and contracts with one of the Humana’s, Aetna’s, etc. of the world to simply administer claims. It is not insurance. If the employer runs out of money, claims do not get paid. The employer bears the full risk of loss. Fully insured plans are what people think of as traditional insurance. The employer pays premiums to the insurance company, and the insurance company bears the risk of loss. Because fully insured programs put the insurance company’s money at risk, they can make these programs mandatory. For self funded programs, the employer’s money, rather than the insurance company’s money, is the one at risk and the employer gets to decide the policy.

      I’m fortunate because my employer’s plan is self funded and has not chosen to follow this new model. But I am nervous about the future.

      • February 10, 2018 at 8:10 pm

        Yes, Bradley. You raise other issues that demonstrate just how complicated this all is. I work for the State; we are fully self-insured. The problem (or benefit in my case) is State law establishes the medical coverage, and they have to figure out how to pay for it and thus are responsible for managing it effectively, versus say a large airline that is self-insured where the funds could be exhausted.

        All of this speaks to why we need single payor healthcare in the United States. I do not mean to sound condescending but most poor souls are unable to understand all of this and get victimized by the system. It’s simply unfair. Not to mention immoral. Healthcare. Is. A. Right.

  • February 13, 2018 at 12:16 pm

    I just spoke to my benefits consultant and they said this is the way it was always supposed to work and there was not specific language in the contract pertaining to co-pay cards. She pointed me to the definition in the plan document that states the deductible is “the amount you must pay each year for covered health care and prescription drugs before the Plan begins to share eligible health care costs with you.”.

    She said that because the definition says paid by “you” they should not count the co-pay assistance payment toward your deductible. They said that they have just had systems limitations to do it correctly in the past. Does that fit the legal definition of being in the contract?

    • February 13, 2018 at 9:24 pm

      My God! There I is no limit to the sleaze of these people, or their lack of integrity. They LIE like RUGS! They cannot make you give up your private information in order to reduce the amount they are paying for your medical care. If they already have your copay card information on file, I would call the company that manages the copay card benefit and tell them you no longer want to participate but ask if you can come back later. Then when your insurance company’s pharmacy tries to take the money from the program, it will show declined.

      If you end up having to pay the out of pocket maximum, go for every medical procedure and test you can. You may as well. If they are going to put you in this uncomfortable position, there is really no reason for you to conserve. They’re trying to hold you accountable for the full amount they believe you should be paying, so you respond in kind by holding them to what they should be paying and then some.

      Now, I am obviously (I hope) only talking about copay cards where there is no available generic medication. If there are those alternatives, then using copay cards is unnecessarily wasteful. Though I have to say looking at the HIV medication tenofovir in the TDF form, there’s only about $200 difference per month, and the generic is still over $900. That is shameful, and it is doubtful a person will be motivated to take the generic form. They’d just switch to a totally different regimen that’s composed of brand drugs.

      I’m sure these insurance companies are searching the internet to see what we are all saying about this….


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