Asheville – Just last week, an associate received a phone call from the local Walgreen’s saying his prescription had been filled and it would cost $549.20. He couldn’t remember how much he paid the last time, but it was around $20. He thought that maybe, it being the new year, one of his insurance cards had fallen off the pharmacist’s deck. When he arrived at the counter, he was told he could get the pills by mail order for $38 or he could pay $549.20 for the bottle they had filled.
After phoning in the mail order, he called back. He wanted to know how the same bottle, plus shipping and handling, could cost so much less. Was there a rule simple enough for him to learn so he could plan future purchases? Or was this another crazy, neo-government game of guess-my-rules. After all, there was a time when he had to check online every day to see if he needed to wear a mask. And, not opting for the REAL ID card, he does have to call the airline each time before he flies to find out what the rules are.
The agent with the online pharmacy explained that they could offer extreme undercuts because of their partnership with the insurance company. It wasn’t a matter of being in or out of the network; that is, if you like your pharmacist, you can keep your pharmacist if you don’t mind paying 15 times more. Rather, it was an advantage of vertical integration. The agent explained, “Some medications are limited fill, and after two refills, the copay goes up,” with two more “ups” implicit.
A similar story is told in a blog by Robert H. Shmerling, MD, for Harvard Health Publishing. That Harvard. Shmerling tells of standing in line at a pharmacy when the person in front of him walked away without her $850 bottle of pills. Shmerling then took the opportunity to reference a drugs.com article highlighting “some” of the most expensive drugs on the market. In first place was Hemgenix, which costs $3.5 million for a single dose. Eight other medications mentioned cost over $1 million for a year’s supply.
The late P.J. O’Roarke’s famous quip, “If you think healthcare is expensive now, wait until you see what it costs when it’s free,” made the rounds in the era of impending Obamacare. Now, statistics about rising healthcare costs astound and abound. Investopedia claims pharmaceuticals cost almost four times as much in the United States as they do in other developed countries. A 2019 Gallup poll found that 22.9% of American families had refused to purchase at least one prescription because it cost too much. In the same poll, 13% of American adults surveyed said a friend or family member had died in the last five years because they could not afford “needed medical treatment.”
Shmerling speculates on why drug costs have risen so much. A knee-jerk libertarian response—not his—would be that pharmaceuticals are insulated from market forces by insurance companies. In a free market, the price is always right. If buyer and seller can’t negotiate an acceptable middle ground, there is simply no sale. With insurance companies, you need this pill, pharmaceutical corporations want so much money, and insurance companies hike everybody’s premiums to cover what their tax-funded government subsidies won’t.
A Google search of “pharmaceutical costs” + “United States” showed several reputable sources, including Investopedia, blaming skyrocketing prices on capitalism unmitigated by government. The highest-ranking web page with a sound economic answer, however, belonged to the philanthropic public policy research and advocacy group Arnold Ventures. They summarized, “High launch prices and unjustified price increases, market distortions, and anti-competitive behaviors by drug manufacturers lead to rising drug costs, a lack of price competition, and government-granted monopolies that allow drug manufacturers to set prices at will.” Arnold Ventures claimed drug prices would increase by 62% over the next decade.
In the meantime, Shmerling gave some advice for controlling medication expenditures. One recommendation was to ask your doctor if every medication you take is “truly necessary.” This question, of course, raises more questions, like, “How commonplace are overprescribing physicians?” and, “How likely are overprescribers to tell on themselves?”
Other recommendations are more constructive, like buying pills in the least expensive dose and combining or splitting them to meet your prescribed needs, buying 90-day supplies instead of 30-day supplies, consulting your insurance company’s list of preferred medications, looking into drug discount and mail order programs, shopping for a new pharmacist, and, a new fad, seeing if it costs less to buy drugs without insurance.