Prescription Payment Caps Enacted in California

California’s Affordable Care Act health insurance exchange marketplace is the first in the nation to enact a payment cap policy for expensive specialty drugs.

Set to take effect in 2016, the rules “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 state agency’s executive director said in a press release.

According to a recent report from pharmacy benefits manager Express Scripts, more than 500,000 patients in the United States had treatment costs exceeding $50,000 last year.

Starting in 2016, those enrolled in Covered California’s bronze plans will pay a maximum of $500 per prescription, per month. The silver and platinum plans will have stricter caps of $150 or $250.

These caps will only apply to Californians who buy coverage on the individual market, though a proposed bill in the state legislature would extend the protection to those with employer-based plans.

New hepatitis C virus (HCV) treatments have been at the center of the drug payment controversy. Sovaldi (sofosbuvir) costs $80,000 for 12 weeks of treatment, while Harvoni (sofosbuvir/ledipasavir) costs $1130 per daily tablet for 12 weeks in HCV genotype 1 patients or 24 weeks in HCV genotype 1 patients with cirrhosis.

After calculating that these drugs alone would cost California more than $200 million in the next fiscal year, state Governor Jerry Brown established a task force to address the issue earlier this year.

“While Covered California is doing its part…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,” the agency stated.