March 29 (UPI) -- Copay discount programs offered by prescription drug manufacturers reduce consumers' out-of-pocket costs by nearly 90%, but fail to target those most in need, according to an analysis published Monday by JAMA Internal Medicine.
Although these financial assistance initiatives trim about $50, on average, from any costs incurred by users above what is covered by private insurance or what they would pay out of pocket if they lack insurance, the data showed.
Of the more than 630,000 people who took advantage of these copay "offsets," however, fewer than 1% lived in counties in which the uninsured population was 25% or more, the researchers said.
"Our findings show that offsets reduce patient out-of-pocket costs substantially, which is of course a benefit to patients," study co-author Aditi P. Sen told UPI in an email
"Our concern is that these offsets do not appear to be targeted to patients who may benefit from them most and also are used only for a small subset of drugs," said Sen, an assistant professor of health policy and management at Johns Hopkins Bloomberg School of Public Health in Baltimore.
Copayment offsets provide out-of-pocket cost discounts on prescription drugs, or even free prescriptions, to consumers, according to Sen and her colleagues.
Billed as financial assistance for those who need it, these discounts, which are offered by drug companies, help offset the "increasing cost" of branded prescription medications.
However, they also are designed to counteract efforts on the part of insurers to direct enrollees to lower-priced generic products, with the goal of limiting drug spending, they said.
For this study, Sen and her colleagues analyzed data on roughly 33 million prescription drug transactions involving more than 630,000 people made between Oct. 1, 2017, and Sept. 30, 2019.
Just under 13% of these transactions, or 4.2 million, involved the use of copay offsets, just over half of which originated with the drug manufacturer, with the rest coming from insurers' pharmacy benefit managers or state assistance programs, the data showed.
Just over 88% of the manufacturer offsets were for branded products, while 91% of the pharmacy benefit manager-based offsets were for generic products.
About 80% of manufacturer-sponsored offsets applied to 6% of prescription medications sold to study participants, while a similar percentage of pharmacy benefit manager-based offsets were linked to about 5% of the products sold.
"We find that manufacturer-sponsored offsets largely apply to branded products," Sen said.
"While we do not directly examine downstream costs in this paper, other evidence has shown that use of coupons for branded products raises drug costs overall," she said.