Medicare Could Have Saved $3.6B on Generic Drugs

Around 2010 I went freelance and was shopping for medical insurance. I'd been on Blue Shield from a previous employer plan and liked them, so I compared their plans.

I was taking one prescription medication that cost $195/month if you paid full retail price. The two plans I was comparing had a $100/month difference in premiums. They were pretty similar in most ways, but the more expensive plan had full coverage for this medication (minus a $20/month copay), and the cheaper plan did not cover it at all.

This was a no-brainer, right? Obviously the more expensive plan would be the better deal.

Some years later I happened to join Kaiser, and their pharmacy page listed the actual cost of the medication: $23/month without insurance, not $195. And if I bought a 100 day supply the total copay for the three month+ refill was $30.

Out of curiosity I checked Blinkhealth and GoodRx, and yes, they each showed a total cost of about $23/month cash payment with no insurance.

$195 was the retail price for the name brand drug. Even though my doctor had prescribed the generic (which I've taken for many years now - in fact I don't think I've ever taken the name brand), the pharmacies were charging the name brand price for the generic unless you had insurance.

One time when Blue Shield messed up on my premium payment and the pharmacy didn't think I had any coverage, I went ahead and paid the full $195 out of pocket to avoid delaying the refill.

That was what got me curious about checking the actual cost of what I was buying.

Here's how I feel about this:

"Nice prescription you've got there. Be a shame if anything happened to it."

This is completely incorrect and fundamentally misunderstands the drug supply chain. The price cost plus lists as typical are just made up. The price they have is just a markup on top of the acquisition price that every pharmacy gets. And the savings the claim are often comparing brand prices to generic prices. First, the consumer view of a brand price is not the same as the 'net price' paid by medicare (there are 20% to even 90% discounts handed by pharma to medicare directly). And second, brands are only dispensed when argued for by the prescriber.

The waste and high prices in the system is generated by pbms taking massive discounts from pharma (of which they keep a %) for brand drugs that shouldnt be covered or often even sold.

Cost plus pharmacy is vaporware - they are a website which applies a flat markup on top of third party pharmacies that will ship you the med. There are no special discounts, they literally aren't doing anything.

Oh, I know - most likely it will contribute to more death and destruction or as you described, wind up in some corrupt official / warlord / oligarch's pocket. There are no good guys in corrupt and evil wars, yet people love to try and pick one.

If folks new the whole story behind this war and the history of the region and US / NGO intervention in it, before throwing their support blindly behind a cause because their government and media told them to, I believe the sentiment around this war would be much different and no one would be cheering either side on in it.

It's just like Medicare and prescription drugs though - trusting citizens expect their government to enact policy that has their best interests at heart. Then they don't, and they turn around and vote for them again anyway. Then they'll wag the finger across the aisle and find some other virtuous cause to distract from the fact they're being screwed over by the very leaders they voted for, that turned around and lied to their faces. Military industrial complex, big pharma, our state-run media - It doesn't really matter what sector the federal government decides to get in bed with, people complain about it and then go right back to the polls to signal their willingness and intent to go through with another cycle of it all over again.

generics arent the same as the original drug. The level of testing required to get a generics approved is ridiculous (basically just a dissolution profile test) and does not give a full picture at all on how the efficacy and safety profile changes in the body.