As most people taking prescription drugs know, even with insurance coverage, out-of-pocket costs can be extraordinarily high. GoodRx lowers people’s drug costs on some drugs. In the process, GoodRx also helps itself quite a bit, profiting because Congress still hasn’t reined in drug prices and insurers don’t see a need to get their members the best possible price for their drugs.
A story in Fortune explains that even generic drugs can end up costing people with health insurance coverage a considerable amount out of pocket. Where you get your drugs matters. According to Kaiser Health News, chain pharmacies, like CVS, tend to charge more than other pharmacies. Millions of people buy their drugs from abroad to save a lot of money.
The generic version of Nexium, esomeprazole, cost one Texan man $490 for a three-month supply, with insurance. Instead of taking it, he googled to try to find it at a lower cost. He found it for $17 out of pocket without insurance at Kroger, through GoodRx, with the coupon it offers.
GoodRx also helped this Texan man fill a different prescription that would have cost him $36 for a month’s supply. Through GoodRx, he could get it for less than half that cost, $16,60. Of course, using this method of getting drugs, keeps him from meeting his drug deductible and insurance out-of-pocket cap.
GoodRx fills an enormous need in the US, helping to make drugs affordable for people who otherwise might not take them. As it is, one Gallup poll suggests that 58 million people forgo needed medicines every year because of the cost.
GoodRx also profits handsomely from its business, which brings together literally more than 200 million price points every day. It had $550 million in revenue in 2020. Its profits were about $55 million in the first six months of 2020.
GoodRx works through Pharmacy Benefit Managers (PBMs), the middlemen that determine which drugs are on an insurer’s formulary and what you must pay out of pocket for them. The PBMs and GoodRx generate revenue whenever you fill a prescription.
GoodRx makes most of its money and gives people the greatest savings on low-cost generic drugs. Different PBMs benefit from providing GoodRx these deals and pay GoodRx for each referral it gives a customer filling a prescription.
Patients with insurance can benefit in any number of ways. If the insurer denies them coverage for a drug, for example, they can use GoodRx to get the drug at less cost than they would have to pay at the pharmacy. As many as half of older adults with low incomes have been told by their health plans that a drug their doctor prescribed was not covered.
But, the fact that people need GoodRx to supply them coupons so that they can afford their drugs, with or without insurance, is positively insane. What about all the people who don’t know about GoodRx? Why shouldn’t Americans be able to get their drugs for free or at a very low cost directly at their pharmacies, as they can in virtually all other wealthy nations? And, since they can’t, why aren’t insurers responsible for ensuring people pay the lowest price for their drugs? Instead, they’re profiting from this system while taking people’s money for coverage people can’t afford.
And GoodRx is driving up costs at the same time it is making drugs available to people at lower cost. People pay a little more for their drugs with the GoodRx coupon so that GoodRx benefits. Why should we have so many layers of profit-taking in the system, so much waste? Why hasn’t Congress simply lowered prescription drug prices for everyone?
A 2018 study published in the Journal of the American Medical Association found that, when people fill prescriptions, more than one in five times (22 percent) their copays are more than the cost of the drugs. That is a travesty. It’s a way PBMs maximize their profits. And the PBMs are owned by the insurers.
And, as much as it helps people, GoodRx is part of the PBM problem. One independent pharmacist claims that GoodRx gives a discount that is sometimes still higher than the pharmacy’s cash price. But, people don’t know. That’s how GoodRx profits. And, all it does is use its algorithms to steer people to lower cost drugs.
Here’s more from Just Care:
- To save money on drugs, avoid chain pharmacies
- With drug prices soaring, millions buy drugs abroad
- Pharmacy benefit managers can drive up your drug costs
- Medicare Part D drug coverage in 2021
- Housing options for older adults
