Pinpointing savings — an impossible feat
In 2019, 40% of Americans would struggle to afford an unexpected $400 bill.
Now what if that bill was $1,445.29 every 3 months?
Would you pick up this chronic medication that controls your multiple sclerosis? (Could you afford to?)
Yes, healthcare is expensive, and sometimes there’s no way to avoid its high price tag. But many times it does not have to be.
The example price list above is for Dalfampridine ER 10mg tablets, a medication used to help improve walking in multiple sclerosis.
So why does it cost so much?
List prices (those that are crossed out in the screenshot above) are the artificially high prices pharmacies submit to pharmacy benefit managers (PBMs) with the hopes of being paid some percentage of that back. PBMs never pay the full price, but rather are contracted to pay some discounted amount. Therefore, if a pharmacy knows they won’t ever get paid the full amount they ask for, they are incentivized to submit artificially high prices to get some percentage back. A pharmacy is also disincentivized to sell to patients directly (cash, i.e. outside insurance) at a fair price, for fear that PBMs will catch wind of the lower price they are charging cash-paying patients. (Note: it is actually illegal in some instances, such as Medicare, to charge the insurer more than what you charge cash).
Enter Coupons
Coupon cards, the ones you get in the mail, see online, and in every doctor’s office, came into popularity to bring down prices for cash-paying patients without disrupting the price-inflating game outlined above. The problem with coupons is two-fold. First and foremost, they actually perpetuate this broken model. By facilitating a work-around and allowing pharmacies to continue to “charge” inflated list prices, there is no industry incentive to change what makes the system broken in the first place. Second, coupon cards add to the price of a drug. Coupon card companies get paid by PBMs each time the coupon is used. I’ll emphasize that again: PBMs still profit when a patient pays cash with a coupon!
I’ll emphasize that again: PBMs still profit when a patient pays cash with a coupon!
About $5–7 is sent to the PBM for each coupon used. Half of that is then shared with the coupon servicer.
Let’s return to the example we started with. Dalfampridine has a list price of $7,801-$15,251 (please note the variation between CVS pharmacies!). If you use a coupon, you can get it down significantly, e.g. $1,445.29 at Rite Aid. Let’s say you bought this at Rite Aid. Rite Aid gets $1,445.29. Rite Aid gives $7 to the PBM (MedImpact in this case). And then, the PBM gives $3.50 to coupon provider.
Enter Blueberry Pharmacy
Blueberry Pharmacy operates completely outside of this broken system. We use cost-plus pricing to remove all intermediaries. You pay what we pay plus a dispensing fee.
With Blueberry Pharmacy, the math is a lot simpler:
Cost + Dispensing Fee = Patient Copay
$27.54 + $5 (member fee)= $32.54
That’s right, the drug with a $7,000+ list price and $1400+ price after coupon, would only cost $32.54 for a member of Blueberry Pharmacy.
The #MATH is simpler at Blueberry Pharmacy.
Where the math gets trickier is in reporting savings. How much did we save this patient? Coupon companies tout savings based on list prices; but as we learned, that is not a real number. Did we save them $1,412.75 off the coupon price? More likely. However, the truth is that healthcare pricing is so broken that promoting savings means that the cost was too high to begin with. Instead, we’ll just say we gave the patient a fair, transparent price and let them determine savings.
…healthcare pricing is so broken that promoting savings means that the cost was too high to begin with. Instead, we’ll just say we gave the patient a fair, transparent price and let them determine savings.
#WelcometoDifferent
