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Strange Pharma Pricing

marting

Illuminator
marting
Joined
Sep 18, 2003
Messages
4,280
It's been a long time since I had any prescriptions but the doc gave me one for minimum BP meds at my last check. Stopped at CVS to fill it. Clerk said it's $90 and asked if I had an insurance card. I don't have any insurance except Medicare A/B so no. She said wait til the pharmacist gets back in 10 mins. we have a special program for people w/o insurance and it will only cost you $10. That makes no sense. What in hell is going on!
 
marting said:
It's been a long time since I had any prescriptions but the doc gave me one for minimum BP meds at my last check. Stopped at CVS to fill it. Clerk said it's $90 and asked if I had an insurance card. I don't have any insurance except Medicare A/B so no. She said wait til the pharmacist gets back in 10 mins. we have a special program for people w/o insurance and it will only cost you $10. That makes no sense. What in hell is going on!
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There's a number of things going on. Maybe too much salt and/or alcohol in your diet, and not enough exercise, is a part of it. Inflation and tariffs may be another part of it. The expectation that safe and effective blood pressure medication should be cheap may be another part of it.
 
Hospital and Doctor prices are similarly out of whack. I get insurance statements that show insurance paid 10 cents on the dollar and the rest is just written off. It's all part of our wonderful US healthcare "system".

ETA: Here's from an actual clinic bill I just opened:
Charges: $1040.00 Patient Payments: $12.58 Insurance Payment: $236.34 Adjustments $790.87 Patient Balance $1.21
So they charged a grand but had no expectation of receiving more than a quarter of it.
 
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Trebuchet said:
Hospital and Doctor prices are similarly out of whack. I get insurance statements that show insurance paid 10 cents on the dollar and the rest is just written off. It's all part of our wonderful US healthcare "system".

ETA: Here's from an actual clinic bill I just opened:
Charges: $1040.00 Patient Payments: $12.58 Insurance Payment: $236.34 Adjustments $790.87 Patient Balance $1.21
So they charged a grand but had no expectation of receiving more than a quarter of it.
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Wow! Crazy stuff. I've been lucky and it's been so long since I've had a prescription filled I had no idea how the biz has "evolved." I worked in a regular manufacturing biz and we sold stuff for a bit of profit we used to grow the biz and make new products. I have no idea how the Pharma biz works. Seems unreal to me.
 
marting said:
Wow! Crazy stuff. I've been lucky and it's been so long since I've had a prescription filled I had no idea how the biz has "evolved." I worked in a regular manufacturing biz and we sold stuff for a bit of profit we used to grow the biz and make new products. I have no idea how the Pharma biz works. Seems unreal to me.
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That would seem to be the goal of insurance companies entirely. Obscurantism, until you have no idea you are being overcharged.
 
marting said:
It's been a long time since I had any prescriptions but the doc gave me one for minimum BP meds at my last check. Stopped at CVS to fill it. Clerk said it's $90 and asked if I had an insurance card. I don't have any insurance except Medicare A/B so no. She said wait til the pharmacist gets back in 10 mins. we have a special program for people w/o insurance and it will only cost you $10. That makes no sense. What in hell is going on!
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Out of curiosity, and if you don't mind, what meds did they prescribe?
 
Norman Alexander said:
Out of curiosity, and if you don't mind, what meds did they prescribe?
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It was a blood pressure med. Olmesartan Medoxomil 5mg. Smallest dose available and one per day. I've been tracking BP since and it seems to make about a 5 point difference. Now running between 115/75 to 130/85 checking it randomly through the day. Probably pretty typical for my age (77).
 
marting said:
It was a blood pressure med. Olmesartan Medoxomil 5mg. Smallest dose available and one per day. I've been tracking BP since and it seems to make about a 5 point difference. Now running between 115/75 to 130/85 checking it randomly through the day. Probably pretty typical for my age (77).
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Thanks. I'm on daily Perindopril, a similar drug but with a slightly different mechanism. Seems to keep my pressure in check, now I am a reasonably active retired 70yo. Cost to me here in Oz is about AUD$12 per 30 tablet box. Used to be about AUD$10, but inflation and all...
 
marting said:
we have a special program for people w/o insurance and it will only cost you $10. That makes no sense. What in hell is going on!
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So what you're saying is that the meds are actually cheaper for people who don't have insurance than they are for people with health insurance?

Yeah. I do kind of agree that that seems to make no sense on the face of it.

As an aside, as someone who also takes blood pressure medication, it is actually generally inexpensive here in Japan. I don't have the price in front of me right now so this isn't exact, but I seem to recall it being roughly between 10 and 20 yen per daily dose. I think that's just my own share of the price, which is 30%, while 70% is covered by insurance. So perhaps the total cost is as much as 60 yen per pill (I take one a day). IOW, about 40 cents per dose in a country where the pharma companies aren't allowed to price gouge like they are in the USA.

The United States spends more than twice what Japan does, and this is even adjusted for PPP:

www.healthsystemtracker.org

How does health spending in the U.S. compare to other countries? - Peterson-KFF Health System Tracker

This chart collection examines how U.S. health spending compares to health spending in other similarly large, wealthy OECD countries using the OECD Health Statistics database.
www.healthsystemtracker.org www.healthsystemtracker.org
 
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Pharmaceutical companies in the UK are allowed to "price gouge" as much as they want but the most you will pay for a NHS prescribed drug is £9.90, depending where in the UK you live and other factors such as age you may pay nothing.
 
Darat said:
Pharmaceutical companies in the UK are allowed to "price gouge" as much as they want but the most you will pay for a NHS prescribed drug is £9.90, depending where in the UK you live and other factors such as age you may pay nothing.
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That's pithy, but could you explain what that means with respect to more expensive drugs? The NHS pays any amount in excess of £9.90? The NHS won't write you a prescription for a drug the costs more? Is there any incentive for Pharmaceutical companies to set reasonable prices?

ETA: also, is £9.90 the price for a single dose, a daily dose, a weekly or monthly dose? A single course of prescription? For things like blood pressure medication that is taken daily, does that mean that (in theory) you could pay up to £9.90 per day?
 
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Puppycow said:
That's pithy, but could you explain what that means with respect to more expensive drugs? The NHS pays any amount in excess of £9.90? The NHS won't write you a prescription for a drug the costs more? Is there any incentive for Pharmaceutical companies to set reasonable prices?

ETA: also, is £9.90 the price for a single dose, a daily dose, a weekly or monthly dose? A single course of prescription? For things like blood pressure medication that is taken daily, does that mean that (in theory) you could pay up to £9.90 per day?
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In England it's £9.90 per item on the prescription, so a pack of 28 one-a-day 2.5mg ramipril: cost to patient £9.90 - about 35p per day.
In Scotland, Wales and Northern Ireland it's free to the patient.
 
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For reference, this is how drug prices are set in Japan:
The price of drugs that are covered by public medical insurance is determined by the government (the Minister of Health, Labor and Welfare), and pharmaceutical companies cannot freely determine the prices of drugs used in hospitals or clinics. The list that summarizes the official prices, known as the “YAKKA KIJUN” (price standard), plays the role of both a product catalog and a price list. Medical institutions and pharmacies bill patients for the cost of drugs prescribed or dispensed based on the official prices set by the price standard (Co-payment rate for a patient is basically 30%). A revision of the official prices called “YAKKA KAITEI” is conducted once every two years, usually in conjunction with the April revision of medical fee schedules.
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Notice the last sentence: medical fee schedules are also set by the government; not just the prices of pharmaceuticals.
 
Also there is no charge in England if the patient is under 16, 16-18 and in full-time education, or over 60. There are other exceptions and exemptions that I can't remember off the top of my head.

Also also, you can get a discount if you get a prepayment certificate - very useful if you have a chronic condition that requires several items per prescription.
 
Anyway, getting back to the OP:

How does it make sense to charge people who have health insurance $90 but only $10 for people who don't have health insurance? I think I know why: It is simply a way for pharmaceutical companies to increase their profits. Blood pressure medication is not strictly necessary for people like marting who has "pretty typical" blood pressure for his age. If forced to pay $90 per period (monthly or bi-monthly) many people without insurance would simply elect to do without. High blood pressure is a health risk, but usually not an urgent medical emergency or a big inconvenience in daily life. They charge what they know the market will bear for people paying out of their own pocket, and charge more to people for whom their health insurance pays most of the cost.
 
Puppycow said:
That's pithy, but could you explain what that means with respect to more expensive drugs? The NHS pays any amount in excess of £9.90? The NHS won't write you a prescription for a drug the costs more?
Is there any incentive for Pharmaceutical companies to set reasonable prices?...snip...
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The £9.90 is the maximum the patient will pay even if for example the cost of the drug would be £99,000.

To the highlighted If they want their drug to be prescribed by the NHSs then yes, the NHS won't prescribe drugs if they are deemed too expensive for the benefit they offer. There are also voluntary agreements between NHS England and the pharmaceutical companies that "regulate" the pricing. There is a really good short summary here:


I
 
Puppycow said:
Anyway, getting back to the OP:

How does it make sense to charge people who have health insurance $90 but only $10 for people who don't have health insurance? I think I know why: It is simply a way for pharmaceutical companies to increase their profits. Blood pressure medication is not strictly necessary for people like marting who has "pretty typical" blood pressure for his age. If forced to pay $90 per period (monthly or bi-monthly) many people without insurance would simply elect to do without. High blood pressure is a health risk, but usually not an urgent medical emergency or a big inconvenience in daily life. They charge what they know the market will bear for people paying out of their own pocket, and charge more to people for whom their health insurance pays most of the cost.
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That's basically accurate, but there's layers of grift going on that are hard to separate.

See, hospitals in America cannot deny treatment for life threatening conditions. That's the only hippocratical concession they are forced to make: they won't sit and watch someone die because that person can't pay. Go us. What they can do is treat them and charge them anyway, and when they don't pay, sell the debt to a collection agency for a fraction of the total. So that fraction (plus the people who do pay) needs to cover their costs, which is why the upfront price for everything is absurdly high. If you don't have insurance, you can't pay that, so you just don't get treatment or preventative care until problems are life threatening and far more expensive to treat than if they had been addressed in time, then there's going to be a collections agency trying to repossess anything they can. Sucks to be poor.

Insurance companies are mostly there to negotiate. When you get an $ treatment, they bill your insurance for $$$, insurance says no ◊◊◊◊ you, we'll pay $$, but you'll only get $ from us get the other $ from the patient. To do all that they need the costs at $$$ because representing a massive discount to made up numbers is how they justify their rent-seeking existence, and that everyone knows the numbers are bs is why no one wept for the health insurance CEO who got Luigi'd the other month.

So the uninsured cost is CVS saying look it's ten bucks.
 
Beelzebuddy said:
Insurance companies are mostly there to negotiate. When you get an $ treatment, they bill your insurance for $$$, insurance says no ◊◊◊◊ you, we'll pay $$, but you'll only get $ from us get the other $ from the patient. To do all that they need the costs at $$$ because representing a massive discount to made up numbers is how they justify their rent-seeking existence, and that everyone knows the numbers are bs is why no one wept for the health insurance CEO who got Luigi'd the other month.
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There's an entire industry dedicated to 'repricing' US hospital invoices. They go through line by line and apply sensible prices to the vastly inflated, initial, cost quoted.

Of course, the money funding that entire aspect of the healthcare industry has to come from somewhere...
 
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