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Drug Coupon Ban States

States that restrict or ban manufacturer copay coupons and drug discount cards, typically Massachusetts and California with narrower restrictions, to combat high drug costs.

How It Works

Massachusetts was historically the only state with a broad coupon ban, enacted 1988 and lifted in 2012 with limitations (prohibition on coupons for drugs with AB-rated generic equivalents). Under current Massachusetts law (MGL Chapter 175H), manufacturer copay coupons are prohibited for any brand-name drug that has an AB-rated generic equivalent available, and coupons cannot be used in Medicare or Medicaid. California enacted AB 265 in 2017, effective 2018, prohibiting coupons for brand-name drugs with lower-cost therapeutically equivalent alternatives (not just AB-rated generics, but including other therapeutically equivalent products). These state restrictions operate alongside federal Anti-Kickback Statute prohibitions on coupons for Medicare/Medicaid, creating complex eligibility logic at the pharmacy counter. Other states have considered but not enacted broad coupon bans, though many have implemented narrower reforms: restrictions on manipulation of coupons within PBM accumulator programs, disclosure requirements for coupon terms, and bans on couponing for specific drug classes. Industry groups have challenged state coupon laws on preemption and dormant commerce clause grounds with mixed results. The policy debate: proponents argue coupons mask true drug costs, distort prescribing toward expensive brands, and inflate premium costs; opponents argue coupons are essential patient access tools given high deductibles and that banning coupons reduces patient affordability. Drug Coupon bans should be distinguished from Prescription Drug Affordability Boards (Colorado, Maryland, Oregon, Washington, Minnesota, Maine, New Hampshire), which set upper payment limits on specific drugs.

Related Terms

  • Copay Card (Copay Coupon), A manufacturer-provided discount card that reduces or eliminates a patient's out-of-pocket copay for a brand-name drug, effectively making the drug free for patients with commercial insurance.
  • Copay Assistance, Financial help from manufacturers, foundations, or pharmacies that reduces a patient's out-of-pocket cost for a specific drug, typically via copay cards, coupons, or charitable grants.
  • Copay Accumulator, An insurance policy that does not count manufacturer copay assistance toward the patient's annual deductible or out-of-pocket maximum, shifting costs back to the patient once assistance runs out.

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About This Definition

This definition is part of the DrugPrice Drug Pricing Glossary, 49 terms explaining how prescription drug pricing works in the United States. All definitions are written in plain language for patients, caregivers, journalists, and healthcare professionals.

this entity is one of the U.S. Medicare prescription-drug pricing concepts that recurs across this site. The definition above is the technical answer; the paragraphs below add the practical context for how the concept connects to the CMS Medicare Part D Drug Spending data data behind every per-entity page on the site.

In the CMS Medicare Part D Drug Spending data data, this concept shapes one or more of the fields that drive the per-entity grades and rankings on this site. The methodology page describes which fields feed into which output; this glossary entry documents the underlying term.

Source: CMS Medicare Part D Spending, 2026.