A couple of weeks ago I wrote about the fact that many of us are encountering serious sticker shock at our local pharmacies. This is most apparent when a low-cost generic you’ve taken for years suddenly skyrockets in price, not uncommonly on the order of several hundred percent. I’ve written about the machinations behind this thievery several times, including this Health Tip on Big Pharma CEO Martin Shkreli.
Perhaps you’ve experienced one of these moments of prescription panic:
- You discover a medication (brand-name or generic) you’ve been taking is now completely denied by your insurer, which has removed it from its drug formulary. Your doctor is told to write an rx for an alternative drug, which you discover either doesn’t work as well as your old med or makes you ill with side effects. When you go to the pharmacy for the drug you’ve been taking for years (but is now off formulary), you’ll be told to pay for it yourself. You can appeal this and ask for something called a “formulary exception,” but don’t hold your breath. Exceptions are hard to come by and require several forms for you and your doctor to fill out. At the thought of paying cash, many patients panic and walk out of the store. Keep reading to learn how paying cash can be turned into real savings.
- You were compelled to change insurers and your new health insurance doesn’t cover the drug you’ve been on for years. Again, the suggested alternatives don’t cut it for you. For a brief moment, you wonder if the drug you’ve been taking has kept you alive all these years and whether now that you can’t have it you’ll need to get your affairs in order.
- You were given some samples of a new drug by your doctor, and it works really nicely for your problem, but when you go to fill the prescription either the price is astronomical (even with insurance) or the drug isn’t covered at all.
At this point, you can wring your hands and curse your fate (I get emails from my patients expressing this all the time) or you can do something about the situation.
Unless you know for certain that the recommended generic replacements either don’t work or have caused side effects, try them. Yes, I’ve written Health Tips about some generics not being as potent as the original brand versions, but fortunately this is rarely the case.
If you find your generic isn’t working, look on the label for the manufacturer’s name and then go online for other manufacturers of that generic. For example, at least 12 different companies make generic Ambien (zolpidem). Call a couple of pharmacies until you find one carrying a zolpidem different from yours. Most likely you’ll find that a different generic is effective without having to refinance your condo to buy the reliable branded version.
Drug discount cards
Always, but always, whether or not you have insurance, check one of several online drug pricing guides to see if you’ll save money by not using your insurance and instead paying cash and using what’s called a drug discount card. In the US, brand-name drug prices are set in stone. When the patent expires, other companies can make the drug, but the brand-name price remains the same. Trying to get a discount on a brand-name drug in the US is an exercise in futility (more about this below).
I’m sure you’ve seen the ubiquitous drug discount cards in display racks in virtually every medical office. There are now dozens of companies finagling discounts. Personally, I’ve found GoodRx and AmericasDrugCard to be very reliable.
When using a discount card, you might experience reverse sticker shock, a very pleasant tingly sensation as something turns out to be far less expensive than you thought. You have to admit that a price drop for 30 tablets of the sleep aid Lunesta, from $446.30 to $22.52, is undeniably impressive and you might wonder how all this works. Well, as a start, don’t expect the Walgreen’s pharmacist who just swiped your credit card for the $446 to volunteer this information. She’d get fired on the spot. How these discount drug cards work is a little complicated, but if you’re interested, keep reading. (If not, scroll down and start reading about purchasing Canadian drugs.)
How discount cards work Depending on your particular health insurance drug plan, your prescriptions are all under the supervision of an entity called a pharmacy benefit manager (PBM). You probably know some of these: ExpressScripts, Prime Therapeutics, CVS Health. The PBM works with your insurer to get the best possible prices for your drugs (not necessarily the best drugs, but definitely the best prices). A PBM negotiates prices with pharmacy chains who, in turn, negotiate prices with generic drug manufacturers. The PBM creates drug formularies for insurance companies that guide patients and physicians on what’s covered and what’s not.
The discount card company, a totally separate entity, steps in, goes to the PBM, and says something like, “Let us have access to that super-low price you just negotiated at Walgreen’s. Every time one of our cardholders pays cash, it’s one less prescription that your boss, the health insurer you work for, has to pay. If we get access to those prices, your boss will save a bundle.”
The PBM thinks, “Sounds real good. Let me ask my boss.”
The PBM then explains the discount card to the health insurance company. It takes about two seconds for them to agree. Any time the enrollee (that’s you) pays for something out of pocket that could be covered by insurance, there are immediate bottom line benefits.
So who loses? Well, naturally the pharmacy, now having to extend that painfully negotiated discount not only to the PBM, but also to the customer with the plastic discount card. However, don’t expect a tag day in support of Walgreen’s, because as you wander up and down the aisles waiting for your now-discounted prescription, you are buying stuff. Sure, Walgreen’s would prefer if you’d pay $446 for your Lunesta instead of $22, but if during your half hour of waiting you buy a couple of bags of circus peanuts, hearing aid batteries, a couple packs of Marlboro Lights, and a fifth of Gordon’s gin, they’re okay with that. Remember, most of that $446 goes to the Big Pharma manufacturer. Most of the profit on circus peanuts goes to Walgreen’s.
Finally, how does the discount card company make money? You need to know that a major income stream for the PBM is a negotiated “filling fee” for every prescription. The fee is paid by the insurance company to the pharmacy, but now the discount card company takes a small sliver of that. Apparently the card companies also make money selling “aggregate” (as opposed to personal) data to any companies that find such information useful.
Important note: Even if you have insurance drug coverage, always check the cash price (not using insurance) on the discount card websites. It will take you about 60 seconds. PBMs have different negotiating skills and patients frequently find that paying with a discount card is substantially less than using their insurance. You’ll also discover astonishing differences among pharmacies. The $22 for Lunesta is at Jewel-Osco. Take the same prescription and the same discount card to Walgreen’s and you’ll pay $140. By the way, if you’ve not yet discovered, overall both Walgreen’s and CVS are much more expensive than Jewel-Osco.
If you come across an expensive brand-name drug or a seriously overpriced generic for which Big Pharma has simply refused to negotiate with a PBM, check the price in Canada. I’ve recommended Universal Drugstore and Canada Drugs for years.
The Canadian government (like the UK and most of Europe) is one big PBM and simply doesn’t take any crap from Big Pharma. If a drug is egregiously overpriced, Canada tells its Big Pharma producer to get lost. Here in the US, on the other hand, Big Pharma actually managed to bribe (sorry, I meant lobby) Congressmen to pass a law making it illegal for the government to negotiate Medicare D drug pricing.
Some examples of Canadian prices:
• Xifaxan 550-mg tablet (an antibiotic) is $36 a pill in the US and $3.10 a pill in Canada.
• Viagra 100 mg is $60 a pill in the US and $3 in Canada.
• Alinia is an anti-parasite med, $83 a pill in the US and $1.10 in Canada.
Before you get too excited about the money you’ll save, you need to know that Big Pharma bought off your congressman (both parties) to try to prevent you from doing this. George W. signed it into law and Obama, in an effort to push through the Affordable Care Act, did not reverse it. Trump has no intention of changing it either.
Since hundreds of thousands of prescriptions are filled in Canada and mailed to happy patients in the US, you can see that the law is enforced to about the same degree as driving while texting. About one customer in a hundred will receive a letter from the US government saying the drug they attempted to purchase has been returned to the Canadian pharmacy. Place the order again and it will likely go through.
The Canadian pharmacies all work the same way: you open an account, give your credit card info, fax your signed prescription, and wait three to four weeks for delivery. They’ll send you email reminders for refills.
One irony about using Canadian pharmacies is that somehow Big Pharma convinced Congress that Canadian drugs could be unsafe or counterfeit. If you look at the Canadian drug, however, it’s the same as the one you’re getting at your local US pharmacy.
The power of money.
David Edelberg, MD