Unmasking the Real Price of Prescription Medicine through data tracking
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You hand over the prescription to the pharmacist after waiting in line at the drop-off window. It’ll be ready in twenty minutes, he says. So you go and read a magazine, do a couple laps around the store, and then wander back. Finally your pills are ready. Here’s a question. Do you have any idea what the bill will be?
If you’re like me you don’t know if it’s going to be $5 or $175. If the former, there’s a sigh of relief. If the latter, hopefully insurance will step up. If insurance denies payment, you can always wait a few more days to see if the problem goes away on its own.
There are few transactions more byzantine than those at the pharmacy counter. And what makes it more frustrating is that pharmacists and doctors rarely help. When prescribing an eye drop or filling a statin prescription, they offer little information on what it will cost. If you ask they’ll say that it depends on your insurance. That’s true, but not helpful.
Leslie Ramirez, an internist working in Chicago, decided to build an simple and elegant Web solution. Ramirez has a practice with lots of uninsured and under-insured patients who would incur out-of-pocket prescription expenses. “It’s sad and it’s frustrating to hear patients say, ‘I didn’t get my blood pressure medicine because it was $100, even though you told me I was about to get a stroke’,” she says.
Two years ago Ramirez spent $20,000 of her own money to build the first version of a Web site that lists actual pharmacy prices. She got the data by calling around to pharmacies in Chicago and getting price quotes for common pills. The list grew to include 550 different drugs and she had to hire helpers to make the calls, though as the site grew in popularity, pharmacies began sending in their own updated price lists.
What she found surprised her. There was no rhyme or reason to any of the pricing. Take Glucophage, a common treatment for diabetes. In Chicago Walgreens charges 4 cents a pill if you buy 270 while CVS charges 38 cents a pill in groups of 60. What other industry has 9x variance?
Another of Ramirez’s discoveries was that Arimidex, which women take after breast cancer surgery, can be had for $25 for 30 pills at Costco. The same 30 pills cost $340 at Walgreens. So it’s not safe to assume that one pharmacy chain always has the best prices. Independent pharmacies, likewise, also range in affordability.
Ramirez also had a bad experience trying to help her mother find a low-priced mammogram. So she added prices for labs and imaging procedures to her site. Those pricing surveys also revealed all sorts of differentials.
Digital Bread Crumbs?