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Discount drug cards aren't always a prescription for savings

This article first appeared in the St. Louis Beacon, May 19, 2011 - Illinois consumers are being flooded this week with offers of a free program that is supposed to help them save money at the pharmacy. Called the Illinois Rx Card, the program promises savings of 30 percent on average for generics and 14 percent for brand-name drugs. The card is available to all residents, regardless of income.

That doesn't mean this card offers the cheapest option. A Schnucks in St. Louis recently charged a customer nothing for 30 tablets of amoxicillin, an antibiotic. But Rx Card's website shows that the same 30 pills of the same strength sell for $18.50 at Schnucks and $19.48 at Walgreens, both in East St. Louis. The website adds that the amount is an estimate, and that the price is subject to change.

Mike Rogers, program director for Illinois Rx Card, says the program offers an advantage over many other cards by discounting all drugs. The program is part of United Networks of America, which calls itself the nation's largest provider of value-added managed-care products and services. It is not a state-run program.

Illinois Rx Card claims consumers have saved about $815 million through its network of services ranging from dental and vision care to cosmetic surgery and smoking cessation programs.

Mike Patton, executive director of the Illinois Pharmacists Association in Springfield, says he has heard plenty of hype over the years about discount cards.

"There are many such programs out there. They get a lot of publicity, and people go out and get their cards. Unfortunately, they are somewhat short-lived."

Patton says the association has identified about 300 patient assistant programs in Illinois, including discount cards and programs online. The programs usually make their money by helping pharmaceutical companies increase their sales, Patton says. In some instances, he says a pharmacy benefit manager or PBM might earn money through rebates for helping a prescription drug company increase its market share. PBMs administer prescription drug plans and negotiate discounts and rebates.

"It's the PBM that benefits from these discount cards," Patton says. He adds that the losers usually are independent pharmacists in Illinois because "much of the cost will probably fall on their shoulders. They are going out of business because Illinois (Medicaid) isn't paying them (enough) and reimbursement levels by insurance companies are depressed."

So why do pharmacists accept the cards?

"They need people walking in the door," Patton says. "The business is so competitive these days when you have stores like Walmart that might provide a prescription drug for $4, and some stores are literally giving away antibiotics." While discount cards offer some savings to consumers, Patton says the hype can be misleading.

"The thing that's not pointed out in most of these plans is that if I have a $20 co-pay on my drug plan, it doesn't mean the discount card is going to reduce the co-pay."

He says that co-pay is often pocketed by the PBM rather than the pharmacy.

Funding for the Beacon's health reporting is provided in part by the Missouri Foundation for Health, a philanthropic organization that aims to improve the health of the people in the communities it serves.