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Accumulating Risk

Updated: Oct 6, 2021

PBM Accumulator Adjuster programs already hurt gross-to-net; now CMS wants to count them against Medicaid Best Price


July 2020

By Dave MacDougall, Jamie Sidore & Katie Devane

Executive Summary

On June 19, 2020 HHS published a proposed rule that includes regulations to clarify how manufacturers calculate their Average Manufacturer Price (AMP) and Medicaid Best Price when a PBM Accumulator Adjuster Program is applied to drug manufacturer patient assistance (e.g., coupon) given to patients. CMS is proposing that manufacturer coupon program spend for Accumulator Adjuster programs should be included as a discount in the calculation of AMP and Best Price. Drug Manufacturers with coupon programs that are not already at penny pricing will see their Medicaid and 340B discounts increase substantially if this rule is implemented. Careful consideration is required around coupon program design, enrollment procedures, eligibility & tracking, and program limitations. Even more immediate, is the importance of assessing the impact on Gross-to-Net for FY21 budgets.


Accumulator Adjuster programs are applied by PBMs when a patient uses a manufacturer-sponsored coupon to reduce their prescription drug cost while in their health plan’s deductible. PBMs and payers dislike manufacturer-sponsored coupons because they believe it undermines their benefit designs and formularies used to establish a patient’s cost-sharing burden and to direct a patient’s drug consumption behavior. Accumulator Adjuster programs carve out any portion of a patient’s deductible paid for by a manufacturer-sponsored coupon program so that it does not count towards a patient fulfilling their deductible requirements. Effectively, it ensures that coupon benefits do not “accumulate” towards a patient’s total annual deductible, “adjusting” the deductible so that it remains intact for the patient to eventually pay. Figure 1 illustrates the economics of an Accumulator Adjuster program for key stakeholders. It is clear why PBMs and payers apply these programs – it can substantially reduce their costs while both patients and drug manufacturers pay more.

In 2019 Accumulator Adjuster programs gained attention by HHS, in part, due to patient advocacy groups and individual state legislatures banning the use of such programs (primarily due to the increase in patient cost-sharing resulting from these programs). HHS finalized a rule (84FR 174541) (1) that many understood to prohibit the use of Accumulator Adjuster programs with brands that did not have a generic equivalent. However, implementation of this rule was delayed, and in May 2020 HHS changed course and finalized a new rule (85FR 29164) (2) allowing payers to apply accumulator programs to brands with and without generic equivalents. The change of approach is due, in part, because CMS was concerned that the prior rule conflicted with IRS Notice 2004-50. Essentially, this notice states that if a drug manufacturer has provided a rebate or discount to a patient enrolled in a health plan that allows the beneficiary to set aside pre-tax earnings to save for medical expenses in an HSA, then the “true economic cost to the individual is the net amount incurred”(2). Since the prior rule only allowed Accumulator Adjuster programs for brands where a generic equivalent was available, this IRS conflict arose for remaining brands providing support for patient deductibles.

New Proposed Rule to Include Accumulator Adjuster Spend in Best Price Calculation

The Medicaid Program proposed rule published on June 19, 2020 (“CMS-2842-P”) (3) includes several rule changes that are worth reviewing. Our focus for this article is on the proposed rule associated with Accumulator Adjuster programs. While the final rule in May was a negative blow to patients and drug manufacturers (allowing Accumulator Adjuster programs), the pain may get worse for drug manufacturers with the new proposed rule. HHS is proposing to count the benefit from manufacturer-sponsored coupons utilized under an Accumulator Adjuster program against Medicaid Best Price. Why? HHS explains in the proposed rule that coupon programs exist due to a safe harbor that allows cost-sharing support to patients without breaking anti-kickback statutes. However, that safe harbor is specific to require that “the full value of the coupon is passed on to the consumer, and the pharmacy, agent, or other entity does not receive any price concession”. Based on the approach that PBM/payers take to implement Accumulator Adjuster programs, they are clearly receiving the value from these programs and not the patient (see Figure 2 – in our example, PBMs/payers realize 26%+ savings while the patient cost increases 10X, despite a nearly 4x increase in manufacturer coupon contributions).

Impact to Key Stakeholders

Drug Manufacturers

The exact way Accumulator Adjuster programs would be incorporated into Best Price is not clear in the proposed rule. However, it is not a stretch to believe that a single coupon offset (especially one applied while a patient is in their deductible) could create significant problems for some specialty brands, as Medicaid rebates will increase substantially.

As we consider the game theory that arises if this proposed rule is finalized, it is interesting to think of the variable impact this would have from brand-to-brand. For example, mature products often are at “penny pricing” with Medicaid rebates because of many years of commercial discounts in the market plus the CPI penalty associated with the Medicaid Unit Rebate Amount calculation. As a result, the proposed rule adds no additional rebate spend for the brand, only administrative burden. However, brands not at penny pricing, particularly new launches, could find this a competitive disadvantage as their accumulator spend quickly results in substantially higher Medicaid rebates (potentially penny pricing) even if only one patient is subject to an accumulator program and used a coupon. In markets where established brands already have incumbency advantages by virtue of a “rebate wall,” (the result of established brands paying high rebates to payers which make it difficult for new products to gain access), this may compound the issue and mean newly launched products can never achieve affordability for patients – an unintended consequence to the proposed rule.

In addition, the proposed rule will increase the discount provided to 340B Covered Entities since Best Price is used to calculate both 340B discounts and Medicaid rebates. HHS states “in order to provide consistency between the AMP and best price sections, where applicable, and to help with streamlining and clarifying a manufacturer’s price reporting responsibilities, the same methodology is applied to AMP (81 FR 5253), and for the same reasons already discussed above, we are making a corresponding proposal with respect to these exclusions in the context of AMP”. This is another blow to brands. Discounts to eligible organizations (e.g., safety net hospitals) through the 340B program has been growing substantially over time and this change will only exacerbate the pressure this program has on a brand’s gross-to-net.

It is also interesting that HHS comments in the proposed rule that they “believe manufacturers have the ability to establish coverage criteria around their manufacturer assistance programs to ensure the benefit goes exclusively to the consumer or patient”. HHS provides no further commentary as to how this can be done. PBMs have intentionally tried to hide Accumulator Adjuster and Maximizer programs from manufacturers and, in many cases, patients.

Drug manufacturers struggle to understand these programs and do not have a proactive approach to know if a patient is subject to an Accumulator Adjuster program prior to the patient receiving a coupon benefit (due to the lack of PBM transparency – see Figure 3). In issuing the final rule in May regarding Accumulator Adjuster programs (2), HHS has stated that payers need to be more transparent, but it remains to be seen how much progress will be made.

This leaves manufacturers with a difficult challenge of how to manage their coupon benefit, patient affordability, and Best Price/340B calculations considering the implications of this proposed rule. This gets only more complex when we consider the competitive dynamics within a class of treatments. As previously mentioned, brands already at penny pricing will see little impact from the proposed rule; however, other competitive brands in the market (particularly launch brands) may be at a disadvantage as Medicaid and 340B rebates will increase substantially. The access and gross-to-net impact could be severe and favor more established brands that will realize less (or no) change.


Patients continue to suffer from Accumulator Adjuster programs today and could be inadvertently impacted by HHS’ proposed ruling. The proposed rule mentions that “the manufacturer assistance does not accrue towards a patient’s deductible and the patient sometimes does not realize this until the manufacturer copayment assistance runs out and the patient receives a significantly larger bill for the drug.” Although, this proposed rule (i.e., impacting the calculation of Best Price) will not directly impact patients, the pressure it creates on drug manufacturers could result in reduced coupon support, exclusion of these Accumulator patients from support, and/or a reduction of other services that are highly valued by patients (e.g., education, adherence programs, etc.). Manufacturer patient support programs enable higher treatment rates and compliance with drug therapy, both of which has been proven to decrease overall medical spend and quality of life for patients in a variety of therapeutic areas (4,5,6,7). This is especially true for brands with no generic equivalent.

In addition, we expect patient advocacy groups will continue to push-back against Accumulator Adjuster programs and additional state-based policy will go into effect in response to the rule that was finalized in May 2020.

Payers & Pharmaceutical Benefit Managers:

The final rule in May was a win for payers who administer Accumulator Adjuster programs. The more recent proposed rule provides little direct value to them but may warrant a change by manufacturers that will impact PBM/payer revenue (e.g., reduction in coupon benefit). In addition, this will likely create an administrative burden on PBMs because they will need to provide drug manufacturers with detailed reporting on Accumulator Adjuster patient coupon use to support Best Price calculations. While this creates additional cost for the PBMs, more importantly, it increases the transparency of these programs and allows manufacturers to see the full extent (and cost) of Accumulator Adjuster programs. Manufacturers armed with this new information (along with current payer rebate spend and admin fees) are likely to push back on the total discount being paid to PBMs/payers (accumulator + rebates).

To avoid reporting and administrative burden, and to protect themselves if the manufacturers subsequently reduce the benefits of coupon programs, PBMs are likely to use this proposed rule as an impetus to move from Accumulator Adjuster programs to Maximizer programs with their employer and health plan customers. We expect that they will migrate more patients to Maximizer programs that continue to fall within the safe harbor for coupon programs but maintain the PBM revenue stream that Accumulators Adjusters have been supporting. By moving to more Maximizer programs, PBMs can avoid providing transparency of Accumulator Adjuster programs.

What Should a Drug Manufacturer Do?

We are advising our clients to prioritize this issue internally as it will have substantial impact on gross-to-net for many specialty brands. In many cases senior management will need to be educated on the details of how Accumulator Adjuster programs work, the current financial impact for a Brand, and be provided a legal perspective on CMS’ proposed rule, to gain the buy-in needed to garner the cross-functional resources required to manage this issue.

Manufacturers should:

  • Provide comments to CMS against this proposed rule…but hurry, comments are due by July 20th.

  • Quantify the forecast and Gross-to-Net impact of the proposed rule, and how devastating it will be to FY21 budgets

  • Evaluate options for mitigating this issue and conduct detailed financial modeling on various potential alternative scenarios

- If solutions include changing patient benefits, then understanding the impact of

patient cost sensitivity on patient utilization is critical to assess the effect of the


  • Conduct stakeholder analysis to understand the impact of each scenario on the Brand, PBMs/payer, patients, and CMS (e.g., follow the money)

  • Determine how Accumulator Adjuster spend would be incorporated into Best Price

  • Finally, it is important to note that the proposed rule also speaks to changes to calculating Best Price to allow for more value-based contracting. While not covered in this summary it is also worth time to review as it creates an opportunity to potentially lower a Brand’s Best Price.


Hayden Consulting Group

HaydenCG is the life sciences industry's premier Market Access and Commercialization strategic consultancy. Our focus is to deliver game-changing strategic guidance and analytical vision to transform the commercial trajectory of therapies, portfolios, and entire companies. Our services are designed to create competitive advantages, establish strong analytical foundations, build growth plans, and address BioPharma’s most pressing Access, Reimbursement, Policy, and Commercialization challenges. Follow us on LinkedIn.

Our Contributors:

Dave MacDougall, Managing Director

Jamie Sidore, Managing Director

Katie Devane, Principal

Follow Hayden Consulting Group on LinkedIn


Hayden Consulting Group and Riparian have partnered to create this Whitepaper series around the Proposed Final Rule for “Medicaid Drug Rebates and Third-Party Liability Requirements”

July 2020: The Proposed Rule and Medicaid Best Price

· Hayden Consulting Group - Accumulating Risk

· Riparian LLC - Patient Assistance Programs Off-Limits?

August 2020: Impact on Value-Based Contracts

· Hayden Consulting Group - Valuing Outcomes

· Riparian LLC - Multiple Best Price Points Contemplated

Proposed Rule…

TBD: Final Rule Publication

· Riparian LLC - Pending Publication

· Hayden Consulting Group - Pending Publication

Download this white paper (pdf)

Accumulating Risk_HaydenCG_July 2020
Download PDF • 573KB


  1. Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2020, 84 FR 17454, April 25, 2019, pages 17454-17568

  2. Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2021; Notice Requirement for Non-Federal Governmental Plans, 85 FR 29164, May 14, 2020, pages 29164-29262

  3. Medicaid Program; Establishing Minimum Standards in Medicaid State Drug Utilization Review (DUR) and Supporting Value-Based Purchasing (VBP) for Drugs Covered in Medicaid, Revising Medicaid Drug Rebate and Third Party Liability (TPL) Requirements, CMS-2482-P, June 19, 2020, pages 37286-37322

  4. Chernew, Michael E., Mayur R. Shah, Arnold Wegh, Stephen N. Rosenberg, Iver A. Juster, Allison B. Rosen, Michael C. Sokol, Kristina Yu-Isenberg, and A. Mark Fendrick. “Impact of Decreasing Copayments on Medication Adherence within a Disease Management Environment.” Health Affairs 27 (2008): 103–112.

  5. Roebuck, M. Christopher, Joshua N. Liberman, Marin Gemmill-Toyama and Troyen A. Brennan. “Medication Adherence Leads to Lower Health Care Use and Costs Despite Increased Drug Spending.” Health Affairs 30 (2011): 91-99.

  6. Gaynor, Martin, Jian Li, and William B. Vogt. “Substitution, Spending Offsets, and Prescription Drug Benefit Design.” Forum for Health Economics & Policy 10 (2007): 1-31.

  7. Rubin DT, Mittal M, Davis M, Johnson S, Chao J, Skup M. Impact of a Patient Support Program on Patient Adherence to Adalimumab and Direct Medical Costs in Crohn's Disease, Ulcerative Colitis, Rheumatoid Arthritis, Psoriasis, Psoriatic Arthritis, and Ankylosing Spondylitis. J Manag Care Spec Pharm. 2017;23(8):859-867. doi:10.18553/jmcp.2017.16272

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