When a physician prescribes medication I always ask if there is a generic and I watch carefully when a brand name drug becomes available generically, often changing a $50+ co-pay to $5 or less. But if we fill prescriptions on cruise control that is without asking the right questions, we can wind up with much larger co-pays.
These guidelines are typical “there may be cost-sharing implications for choosing non-preferred brand medications when generics are available. Your cost share depends on which of the three generic substitution coverage levels you have — voluntary, mandatory or restrictive. Refer to your benefit summary or enrollment materials for more information.” “ (A)
“Consumers have grown accustomed to being told by insurers — and middlemen known as pharmacy benefit managers — that they must give up their brand-name drugs in favor of cheaper generics. But some are finding the opposite is true, as pharmaceutical companies squeeze the last profits from products that are facing cheaper generic competition.
Out of public view, corporations are cutting deals that give consumers little choice but to buy brand-name drugs — and sometimes pay more at the pharmacy counter than they would for generics.
The practice is not easy to track, and has been going on sporadically for years. But several clues suggest it is becoming more common.
In recent months, some insurers and benefit managers have insisted that patients forgo generics and buy brand-name drugs such as the cholesterol treatment Zetia, the stroke-prevention drug Aggrenox and the pain-relieving gel Voltaren, along with about a dozen others, according to memos and prescription drug claims that pharmacies shared with ProPublica and The New York Times. At the same time, consumers are sounding off on social media. (B)
“Success is when you get doctors selling the product for you,” said former pharmaceutical representative Michael Oldani, now an associate professor of medical anthropology at the University of Wisconsin-Whitewater.
The patients present the card to the pharmacist when they’re having a prescription filled. The card cues the pharmacist to fill the prescription using the brand-name drug, even though it can cost much more than the generic version.
At one Toronto pharmacy, brand-name Lipitor (10mg/90 pills) sold for $168.83 while the generic version, atorvastatin, cost $28.24.
“The pharmaceutical companies are not making a charitable donation when they hand out cards. They’re definitely planning to turn a profit. It’s part of a marketing strategy.”
In theory, the drug company is supposed to pay that cost difference.
But in practice, sometimes the drug company never gets the bill, because some company insurance plans pay the full cost of the more expensive brand-name drug if a doctor specifies its use.
In reaction to the cards, many insurance companies now refuse to reimburse patients for brand-name drugs when there is a generic alternative.
To get around that rule, doctors are encouraged by drug company sales representatives to write “no substitutions” (C)
“Having health insurance is supposed to save you money on your prescriptions. But increasingly, consumers are finding that isn’t the case….
In an era when drug prices have ignited public outrage and insurers are requiring consumers to shoulder more of the costs, people are shocked to discover they can sometimes get better deals than their own insurers. Behind the seemingly simple act of buying a bottle of pills, a host of players — drug companies, pharmacies, insurers and pharmacy benefit managers — are taking a cut of the profits, even as consumers are left to fend for themselves, critics say.
Although there are no nationwide figures to track how often consumers could have gotten a better deal on their own, one industry expert estimated that up to 10 percent of drug transactions involve such situations. If true nationwide, that figure could total as many 400 million prescriptions a year…
Pharmacy benefit managers, the companies that deal with drug benefits on behalf of insurers, often do negotiate better prices for consumers, particularly for brand-name medications, …, but that’s not necessarily true for some generic drugs. Insurers’ clients are frequently employers overseeing large numbers of workers, and the companies are focused on overall costs. So when insurers seek deals for generic drugs, they do so in batches, reaching agreements for groups of different drugs rather than getting the lowest price on every drug.
As a result of these complicated layers of negotiation — which are not made public — different insurers end up paying different prices for individual drugs. Further compounding confusion for consumers, some insurers require a set co-payment for each prescription — say, $15 or $20 — even when the insurer reimburses the pharmacy at a much cheaper rate.” (D)
(A) Is Grassley Concern Over DAW Penalty Much Ado About Nothing?, by Angela Maas, https://aishealth.com/archive/ndbn050117-04
(B) Take the Generic, Patients Are Told. Until They Are Not, by CHARLES ORNSTEIN and KATIE THOMAS, https://www.nytimes.com/2017/08/06/health/prescription-drugs-brand-name-generic.html
(C) ‘Success is when you get doctors selling the product for you’, by Kelly Crowe, http://www.cbc.ca/news/health/drug-companies-using-doctors-discount-cards-to-skirt-generic-substitutions-1.3042773
(D) Prescription Drugs May Cost More With Insurance Than Without It, by CHARLES ORNSTEIN and KATIE THOMAS, https://www.nytimes.com/2017/12/09/health/drug-prices-generics-insurance.html