Covered California imposes price caps for specialty drugs

Health exchange Covered California said it is the first in the United States to adopt benefit design changes to improve access to high-cost specialty drugs.

The vast majority of Covered California consumers will see their specialty drugs capped at $250 per month, per prescription. Overall, the caps will range from $150 to $500, and, because of Covered California’s standard benefit design, they must be offered by every health plan in the individual market as well as by all plans offered by the exchange.

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The cap will reduce the monthly out-of-pocket costs for consumers so that enrollees pay less each month. Before the changes, consumers who needed these medications were forced to spend their entire maximum out-of-pocket costs - sometimes thousands of dollars - in their first few months of coverage, according to a statement from Covered California.

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“This is the first time that an exchange has ensured that all of its consumers have access to the medications they need,” said Covered California Executive Director Peter V. Lee. “These new policies strike a balance between ensuring Covered California consumers can afford the medication they need to treat chronic and life-threatening conditions, while keeping premiums affordable for all.”

The changes will take effect in 2016.

Despite the healthcare exchange’s policy changes, a broader solution is needed to “curtail the explosion in specialty drug costs, so that consumers get the care they need without driving up insurance costs so much that consumers can no longer afford coverage,” Lee said.

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