Private Pharmaceutical Assistance Programs

Some private pharmaceutical companies offer their products to low-income individuals for free or reduced prices through pharmaceutical assistance programs (PAPs) and drug discount programs. These programs have also been called "indigent patient programs." Due to Medicare Part D coverage, many of these programs either no longer offer their services to Medicare beneficiaries who are eligible for or enrolled in a Medicare Part D plan, or they require some attempts to have the Part D plan pay for a medication before they will assist a beneficiary. There is a separate application process for each individual medication that varies between each company.

PAPs are not comprehensive insurance plans and therefore are not considered creditable coverage. Some programs may only provide one free sample or supply of a medication; others may provide ongoing assistance. The application process requires the participation of a physician who will receive and administer or deliver the drug to her patient.

It is important to know that the total cost of the drug that a PAP provides to a beneficiary in the coverage gap does not count towards True Out-of-Pocket Costs (TrOOP). Therefore, assistance from a PAP extends the time that a beneficiary spends in the coverage gap, and, hence, delays the Part D catastrophic benefit. However, if a beneficiary must pay a co-pay or co-insurance amount to receive a PAP-provided medication, the co-pay or co-insurance amount count towards TrOOP if the medication is on the plan’s formulary.

Other sources that count towards TrOOP include all payments made by the beneficiary, relatives, friends, or charitable foundation contributions, qualified SPAPs, and waivers or reductions by in-network pharmacists and formulary medications. To learn more about TrOOP, please refer to "Costs and Prices" in HAP's Medicare Part D SHIP Resource Guide.

To streamline the application process, CMS created a dedicated website that compiles detailed information about all of the PAPs available through every drug manufacturer. The site lists medications by name to find out whether the companies offer it free or at low cost: http://www.medicare.gov/pap/.