According to a study published on Monday in the journal Annals of Internal Medicine, patients might save millions of dollars by purchasing prescription medications through online pharmacy discount programs rather than through conventional insurance policies.
Online pharmacies, like Mark Cuban Cost Plus Drug Co., have grown in popularity in the U.S. because they frequently offer generic medications at lower costs than retail pharmacy chains and insurance plans. For those buying with cash, several online pharmacies, including Amazon Pharmacy and GoodRx, even provide prescription discount cards that cover all or virtually all of the cost.
Medications for heart failure, antidepressants, and statins were among the 20 generic pharmaceuticals examined by researchers at the University of Toledo College of Pharmacy & Pharmaceutical Sciences in Ohio. They then made a comparison between the costs that consumers paid out of pocket for these medications in 2020 and the prices that Amazon and GoodRx’s discount pharmacy card programs advertised this year.
The analysis took into account both insured and uninsured individuals, as well as those with private and public health insurance plans like Medicare.
They discovered that, compared to what patients really spent for the medications out of pocket, at least one out of every five prescriptions were less expensive when purchased using an Amazon or GoodRx discount card.
For customers of Amazon Pharmacy and GoodRx, the potential savings were anticipated to be significant: $969 million and $1.83 billion, respectively.
“The takeaway really is the fact that these discount cards programs are possibly a tool for lowering the out-of-pocket burden for Americans,” said lead author Pranav Patel, who was an analyst in research at the University of Toledo while he conducted the study.
The results are consistent with other research, such as a paper from last year that appeared in Annals of Internal Medicine and revealed that Medicare might have saved billions of dollars by buying generic medications at the same costs as those charged by Mark Cuban Cost Plus Drug Co.
According to the Rand Corp., a public policy think organization, Americans pay up to 10 times more for prescription pharmaceuticals than people in other nations of comparable size and affluence. Prescription drugs are exorbitantly expensive in the U.S.
The Inflation Reduction Act, which was enacted last year, contained a number of features aimed at bringing down the price of prescription drugs for senior citizens, including allowing Medicare to bargain directly with pharmaceutical companies. The first 10 prescription medications that would be subject to Medicare negotiations for prices under the terms of the federal law were disclosed by the Centers for Medicare and Medicaid Services last week. In 2026, the agreed-upon pricing will become effective.
However, Patel pointed out that there can be negative aspects to the discount card schemes.
Some programs might charge a monthly price for prescriptions, which might end up being the same as or more expensive than what someone might spend with insurance.
They can also be related to “pharmacy shopping,” where patients purchase various drugs from various pharmacies in an effort to find the best deals. According to Patel, this practice raises the risk of drug interactions because the pharmacist at one pharmacy might not be aware of all of the drugs a patient is taking.
He added, “It might be a case of penny wise, pound foolish.”
Pharmacist Mike Koelzer of Grand Rapids, Michigan, stated that “the value of talking face-to-face with a health care professional shouldn’t be underestimated.”
However, he pointed out that online pharmacy discount programs can offer significant cost reductions, particularly for those without insurance, as the businesses frequently engage in direct negotiations with drug manufacturers and sell medicines to clients at the price they paid for them plus a tiny markup.
That contrasts with insurance plans, which often have a predetermined cost or fee for a drug. (A specific medicine might cost $5, but the set copay might be $10.)
The ability of these platforms to negotiate better costs, according to Koelzer, is where the true potential advantage lies.
The survey also discovered that patients without insurance or those who had insurance but had not yet met their plan’s deductible frequently paid extra out of pocket for their prescription drugs. According to Patel, it’s probable that these people had so-called high-deductible plans, which often have lower monthly premiums but need substantially higher out-of-pocket expenses before coverage begins.
These online savings schemes can give “terrific deals” on generic medications for some patients, according to Larry Levitt, senior vice president for health policy at KFF; however, they are unlikely to offer much for those with strong insurance coverage.
The study found that out-of-pocket expenses were frequently equivalent to or less than the costs claimed by the drugstore discount programs when insurance did pay some or all of the cost of the prescription.
He claimed that drug pricing had previously been a “black box,” but these disruptors had opened it up. But it’s still unclear how far they can advance beyond the obvious opportunities.