Anybody Selling These Drug Plans?

Jan 11, 2009

  1. policy doctor
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    INFLATED DRUG PRICES

    January 8, 2009 · Volume 9, Iss[SIZE=+2]u[/SIZE][SIZE=+2]e[/SIZE][SIZE=+1]1

    Switching to generic medicines can be a smart way to save money. People with Medicare, however, have to be careful that their Part D drug plan is not padding the bill for generic drugs.

    Under the Silver Script Value plan, a Cleveland resident taking two heart medicines, a drug to lower cholesterol, an antidepressant, a medicine for a gastrointestinal disorder, and a drug to treat pain from shingles would spend $2,252 over the course of 2009, entering the Part D coverage gap in September. Once in the coverage gap (or doughnut hole), a SilverScript enrollee would pay the plan's full price for these generic medicines--over $300 per month--for the rest of the year.

    For the savvy consumer, there are five drug plans in Cleveland that cost less than $700 for the year for the very same drugs, less than a third of what a SilverScript member would pay. Enrollees in these plans never hit the coverage gap.

    What explains the huge difference in drug prices?

    Express Scripts, the pharmacy benefit manager that offers the SilverScript plans, is jacking up the cost of these and other generic medicines. Instead of using the price SilverScript pays the pharmacy for these drugs, it charges enrollees an inflated price that it pays itself for administering the benefit. Carvedilol, a heart medicine, costs over $44 dollars under SilverScript, more than twice the price in other plans that charge enrollees the real pharmacy price. Gabapentin, for shingles pain, costs over $100 under SilverScript; it costs under $40 under competing plans. These high prices push SilverScript enrollees into the doughnut hole and stick them with higher prices once they have fallen into the coverage gap.

    This pricing scam, which is also employed by other drug plans and Medicare private health plans that offer drug coverage, has been going on since the start of the Part D benefit in 2006, and it will continue throughout 2009. In 2010, however, thanks to regulation issued by the Centers for Medicare & Medicaid Services (CMS) this week, the scam will come to an end. Medicare private health and drug plans will no longer be allowed to charge members drug prices that are higher than the rate they pay pharmacies.

    Problem solved?

    Not entirely. Consumers can still be victimized by this pricing scam when they use mail order pharmacies, many of which are owned by these pharmacy benefit managers or are partners in offering Part D drug plans.

    WellCare Classic, one of the cheapest drug plans for a Cleveland resident with Medicare who takes these 7 drugs, would cost $444 for the year using retail pharmacies but $1,997 using mail order. Consumers who use WellCare's mail order pharmacy, whose prices average twice the rate at retail pharmacies, get pushed into the doughnut hole in July. They never get out.

    CMS says in the recent regulation that it will keep an eye on such price discrepancies. They should. Such inflated prices are not just a bad deal for consumers; they cost taxpayers more money too.

    [email protected][/SIZE][FONT=Verdana][SIZE=+1]a[/SIZE][/FONT][SIZE=+1]rerights.org
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    I don't write too many PDP plans but it's a shame that they can't standardize the pricing of drugs with these carriers. As usual the American consumer is always ripped off.
     
    Last edited: Jan 11, 2009
  2. midwestbroker
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    The problem with drug pricing is that it all depends on where you buy them. They could go off a national average cost for the drug. However, CMS cannot track what they are doing right now, I can only assume that this would just add more headache to the mix.

    In KC, the rule of thumb is Costco is the cheapest place (and you do not need a membership to use the pharmacy).
     
  3. Russ
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    Thanks for the information. I wasn't aware of that. I haven't written Silver Script, but I've replaced it before.
     
    Russ, Jan 11, 2009
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  4. retread
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    retread, Jan 11, 2009
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  5. MedSuppPro
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    Isn’t it amazing that this rule reversal surfaces now? Could it be someone had a guilty conscious? :skeptical:
     
  6. retread
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    Well if he were conscious, maybe his conscience would bother him:laugh:!

    (In the words of Chumps... this post spell checked!!):D:D:D
     
    retread, Jan 11, 2009
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  7. MedSuppPro
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    [FONT=&quot]Good thing we got a Harvard graduate running this joint. :twitchy::twitchy::twitchy:
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  8. retread
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    I suppose Harvard beets Yale...:nah::D
     
    retread, Jan 12, 2009
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