Pain at the Prescription Counter: How to Reduce What You Pay for Drugs

Have you seen the cost of a prescription jump from $3 to $30 when your doctor changed your dosage? Were you ambushed by a $500 copay for a tube of steroidal skin cream? Are you carrying a $300 EpiPen — essential for emergency treatment of deadly allergic reactions — that used to cost $50? Have you discovered that your atorvastatin (generic Lipitor) costs less if you put away your insurance card and pay cash?

Welcome to the drug price maze! More and more, certain peculiarities of the pharmaceutical market are clashing with insurance arrangements that require patients to pay a bigger share for their prescriptions, leading to confusion and sticker shock. “When your insurer paid most of the cost and copays were minimal, no one complained as the prices skyrocketed,” says physician Elisabeth Rosenthal, editor in chief of Kaiser Health News and author of “An American Sickness: How Healthcare Became Big Business and How You Can Take It Back.” Now, she explains, “copays and deductibles are going up, and we’re all feeling those prices in a way that has made everyone sit up and go, ‘Whoa!’ ” There are ways for consumers to reduce what they pay for many drugs, but they must learn how to ask questions and where to look for answers.

Drug pricing has been relatively straightforward until recently, at least for consumers. Branded drugs, patented by their creators, cost a lot, but insurance picked up most of the bill. When the patents expired, manufacturers of generic drugs offered much cheaper versions, and typical copays dropped to just a few dollars. Pharmaceutical companies had an incentive to keep discovering new drugs, and the price burden for underwriting those discoveries was temporary and led to a steady flow of new, inexpensive generics.

[See: 8 Questions to Ask Your Pharmacist.]

It’s still a straight path most of the time. Generic drugs accounted for 90 percent of the more than 5.8 billion U.S. prescriptions written in 2017, according to research firm IQVIA, and more than 97 percent of all prescriptions (both branded and generic) cost patients less than $50 out of pocket. Almost a third of prescriptions written in 2017 were free to the patient, because of regulations or insurance arrangements. (For example, the Affordable Care Act mandates no patient payment for all FDA-approved contraceptives and preventive medications, like cholesterol-lowering drugs and vaccines, and insurance plans may stop charging copays once patients have reached their out-of-pocket limit for the year.) “The vast majority of drugs are inexpensive and are one of the best values in the health care system,” says Brigham and Women’s Hospital’s Aaron Kesselheim, associate professor of medicine at Harvard Medical School, who studies drug pricing.

But he notes that several factors distort the market for pharmaceuticals in general and generics in particular, and they can deliver extreme price blows to people whose prescriptions are in that expensive 3 percent, or to those whose insurance coverage, or lack of it, makes them responsible for a significant chunk of their medication costs. Those factors include:

No standard pricing. Retail pricing for prescription drugs is a black box, says Doug Hirsch, a former Facebook executive who co-founded GoodRx, a drug price comparison app and website, in 2011. He realized there was a need for such a service when he discovered that the cash cost for a month’s supply of the ADHD medication Vyvanse, which wasn’t covered by his insurance, could vary by as much as $150 depending on which pharmacy he went to. “I assumed the guy with the white coat had a master price list, but there isn’t one,” he says.

Most insurers rely on pharmacy benefit managers, or PBMs, to negotiate with drug companies, and those deals vary. If a pharmacist tells you that a drug isn’t “on your formulary,” Hirsch says, it means your insurer’s PBM hasn’t negotiated any savings on it and may not cover it. Sometimes you can make out by skipping your insurer entirely, using discounts available on price comparison websites or “doorbuster” specials offered by some pharmacies. Take the cholesterol drug atorvastatin, for example. In early June 2018, GoodRx showed that the cash price for a month’s supply was $150 at Walgreens but a mere $17 at Costco ($7.84 with a GoodRx coupon). If you check your coverage, you may find that your copay at Walgreens is more than the cash price at Costco.

[See: 10 Lessons From Empowered Patients.]

No competition. A three-month supply of 40-milligram capsules of the popular antidepressant fluoxetine (generic Prozac) costs as little as $10 at Walmart, according to GoodRx, and will rarely trigger more than the minimum copay at most pharmacies. But if your doctor ups your dosage to 60 mg, the cash price can hit $900 at many pharmacies, according to GoodRx, though a store coupon can knock it down by more than one-quarter. Your insurance copay is likely to rise accordingly.

That’s most likely because that particular dosage is available from only one or a small number of sources, Kesselheim says. “If there are eight manufacturers making a 40-mg version of a certain drug, but only one making a 60-mg version, then that manufacturer can charge whatever it wants.” It takes four or more manufacturers of the same product for prices to go down significantly, according to his research. Patients can sometimes avoid the high-priced version by asking their doctors to prescribe a drug in its cheapest form (in the example above, by asking their doctor to prescribe a combination of 40-mg and 20-mg capsules), but that strategy requires knowledge. “Most physicians don’t know anything about costs, or talk about them with their patients,” Kesselheim says.

No price regulation. As a generic drug’s price approaches rock bottom, manufacturers may lose interest and leave the field. The last one standing can jack up the price, and patients who need the drug have to pay. That’s how the anti-parasite drug Daraprim went from $1 per pill several years ago to $750 in 2016. Martin Shkreli, who engineered that headline-grabbing increase while at the helm of Turing Pharmaceuticals, recently went to prison, though for securities fraud rather than price-gouging (still widely legal at this writing). But Daraprim still costs about $750 per pill (as of June 2018), leaving patients with life-threatening toxoplasmosis or other parasitic infections to either pay up or resort to less effective medications. This incident and others have prompted a flurry of state-level legislative activities — 357 bills in 47 states in the first five months of 2018 alone — directed at pricing and payment, according to the National Conference of State Legislatures.

No generics. Even if a product goes off patent, generic drug manufacturers may ignore it if it’s hard to duplicate the branded version. Creams, ointments and inhaled medications are especially likely to be available only as branded products, Rosenthal says. In March of 2018, Kaiser Health News’s “Bill of the Month” — a column that deciphers medical bills submitted by readers — featured a $1,500-per-month treatment for toenail fungus that drained the patient’s health savings account without her knowledge when she relied on her insurer’s mail-order pharmacy. “The dermatologist’s office never told her it was expensive,” Rosenthal says. “But it’s the first thing you should ask.” EpiPen supplier Mylan raised its price from about $100 to over $600 for a two-pack between 2007 and 2016. After public outcry and protests from lawmakers, the company started offering coupons and making a generic EpiPen.

You may be able to get your drug costs down with a few simple strategies. Jennifer Spare, of Hanover Park, Illinois, usually saves between $25 and $40 per prescription just by checking local pharmacies for the best prices. She usually skips large chains in favor of a small family-owned pharmacy. “They have the best pricing around, and they’ll mail your prescription to you at no charge,” she says. Spare has also saved as much as $60 just by asking the pharmacy for a discount. Comparison shopping is a little more complicated with electronic prescribing, where the doctor automatically sends the prescription to the patient’s pharmacy of choice. Many states now require e-prescriptions for some or all medications. You might find it a pain to compare costs every time and request that the pharmacy in your electronic medical record be changed once you find the best price, but it should take your doctor under a minute to make the switch, says Los Angeles internist Sharon Orrange, a clinical associate professor of medicine at the University of Southern California’s Keck School of Medicine. She often uses the GoodRx phone app to check local prices with patients before she writes a prescription.

Some patients look abroad to find deals. Consumers can sort through the many foreign sources of medication to find ones that are reputable at The site verifies the credentials, contact information, product quality and pricing for foreign pharmacies, says Gabriel Levitt, president and co-founder. “It is technically against the law to import a medication, but as far as we know the government has never prosecuted anyone as long as it’s for themselves or a family member.” In a 2016 poll by the Kaiser Family Foundation, 8 percent of Americans said they had bought prescription drugs from another country. Rosenthal knows a U.S. asthma patient who buys his inhalers in Paris. With a $200 difference between the U.S. price and the French price, savings on two or three inhalers can cover his airfare.

Patients hit with big drug bills may have to choose between paying the rent or forgoing medications: a choice that can have dire ramifications. One study estimated the U.S. racks up $100 billion to $300 billion in avoidable health care costs annually from people not adhering to their regimen, and high costs accounted for 17 percent of those failures. In a 2016 survey by the Commonwealth Fund, 14 percent of insured Americans didn’t fill a prescription or skimped on their dosage because of cost. For the uninsured, it was 33 percent.

[See: How to Help Aging Parents Manage Medications.]

Orrange, like all doctors, wants her patients to use their medications. If you’re tempted to skimp or pass because of cost, she wants to know immediately — not three months later during a follow-up appointment. She’s happy to go to bat with insurers, especially if her patient does much better on a branded drug than on its generic cousin, or if the insurer suddenly decides not to cover a drug that the patient has been taking for a long time. “Bring it up with me, and I’ll help you find the best price,” she says. “Both of us have a stake in you taking your medications.”

If your doctor isn’t as price-aware as Orrange (and most aren’t), speak up. “Tell your physician about the price of your drugs,” Kesselheim says. “It’s possible there’s another equally effective drug that might be cheaper.” Rosenthal agrees. “Train your doctor,” she says. “If all their patients ask how much their prescriptions will cost, they’re going to have to know.”

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Pain at the Prescription Counter: How to Reduce What You Pay for Drugs originally appeared on

Correction 09/11/18:

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