A friend recently shared this personal story with me, in the hopes that it will inspire people to demand price controls on drugs, as well as an end to the Rx profiteering by insurance companies. This is a story about a commonly-prescribed generic drug, levothyroxine, used for hypothyroidism and other thyroid conditions. The fact that this is a common and generic drug is significant. Since it is a widely used drug, the following story gives perspectives on the scope and amount of profit being made on just this one medicine. And in turn, this small story can help increase understanding of the magnitude of the Rx pricing problem.
Now for the story. My friend recently retired from nursing at not quite age 65, and had been paying costly COBRA premiums until she could enroll in Medicare. The hospital where she had worked offered a comprehensive plan through one of the big insurers in Washington state, including a $7 co-pay for drugs on the plan’s formulary. Levothyroxine was one of these.
After retirement, my friend planned an extended out-of-area trip, so she wanted to purchase a full 3-month supply of her medicine to take with her. She had coverage via COBRA for October, but could not get benefits from Medicare Part D until her Medicare activation date the following month. So she planned to pay the $7 co-pay for her medicine for October, plus the out-of-pocket price for the supply for the next 2 months. She had checked the Rx price look-up feature of the insurance company’s website, and learned that the retail price of levothyroxine was listed as $24-$28 for a 30-day supply. My friend then took her script for 90 days of levothyroxine to be filled at the community pharmacy she had always used, and got a big surprise.
This time, the surprise wasn’t the sticker shock we have come to expect all too frequently, but just the opposite, and equally problematic. The pharmacy told her that while she was welcome to apply her co-pay to 30-days worth of the medicine, they could sell her the entire 90-days worth for a total of $10!!!!!
While this was good for her pocketbook, she was astounded to think about how much this basic generic drug had been marked up to benefit the insurance company and the manufacturer who set the price reported to the insurer. While the pharmacy was undoubtedly making a modest return on this Rx, it was presumably not out to gouge its customers, quite remarkable these days. And this is not even a one of the costly drugs, even at the retail price listed by the insurer. When one figures how many scripts are written for levothyroxine across the country each month, the dollar amounts are staggering.
The lesson to individual consumers is that while we must continue to push for price controls on Rx drugs, we also need to shop around for prices, even if insured. And it’s good to remember that even for those with Rx insurance coverage, there is no requirement that an Rx benefit be used, if a better cash price is found. It can be difficult to check medicine prices, but well worth the time spent doing research over the phone and via the Internet. Plus there are resources for some states and communities that offer Rx price-comparison tools that include commercial pharmacies. For example. folks in Illinois can check prices for drugs and medical procedures, on Leslies List, an independent website created by primary care physician Leslie Ramirez, to help improve access to care. In my state, there is a price-checker tool for drugs on the formulary of the Washington Prescription Drug Program. BTW, all WA state residents can request a free WPDP card to use at participating pharmacies. I have found in some cases, the WPDP price for certain medicines is less than the co-pay charged by my insurance company. It pays to compare prices between big box stores, supermarket pharmacies, and community pharmacies. The “$4 generics” that have been so widely promoted may not always be the best deal, nor actually sold at that price. Another resource for helpful tips on shopping for drugs and their prices is Consumer Reports.