It’s no secret that the American health care system is complicated, and getting prescription medications can be particularly bewildering and costly. One option for consumers is GoodRx, a company that aims to make drug pricing more transparent while giving consumers access to discounts on prescription medications.
But what are the pros and cons and how does it work with insurance plans, including Medicare?
What Is GoodRx?
Founded in 2011, GoodRx is a free-to-consumer website and mobile app that tracks prescription drug prices and provides coupons for discounts on medications. GoodRx is not an insurance program, and it operates outside of conventional health insurance programs like Medicare.
Doug Hirsch, co-founder and chief mission officer of GoodRx, says the idea for the company came to him when he was prescribed a medication that was going to cost about $500 at his regular pharmacy. He tried another pharmacy up the road and was quoted $250. A third quoted him $400, for what he thought was a “cheap, generic drug.”
When he refused to pay and left the pharmacy without the medication he needed, the pharmacist chased him into the parking lot and said she wanted to help him get the medicine.
“I started by accident to find out there were these drug discounts that would enable someone who’s purchasing a drug to get it for much, much less,” he says.
[READ: How to Save Money on Prescription Drugs]
How Does GoodRx Work?
With GoodRx, you can more easily access discounts to reduce the costs of prescription medications. GoodRx does this by working closely with pharmaceutical managers and pharmacy benefit managers. (PBMs, Hirsch says, are the “Ticketmaster of health care” who negotiate with pharmacies on behalf of insurance companies and employers to set prices and copays for medications.)
“We’re sort of Switzerland in the middle of trying to work on behalf of the consumer,” Hirsch explains, adding that GoodRx brings together all the various discount programs to find which is the best one for you. “There’s tremendous savings, and often you’ll pay less than you would pay with a copay, or certainly if insurance doesn’t cover it.”
Since it launched, Hirsch says, the company has saved Americans upward of $70 billion.
Using GoodRx
When you search for a specific medication in the app or on the website, you’ll be presented with a list of nearby pharmacies and exactly what they are charging for that prescription. GoodRx currently works at more than 60,000 pharmacies across the United States.
Hirsch also notes that GoodRx discounts medications that may be dispensed for your pet from a regular human pharmacy. Pets don’t qualify for Medicare or human health insurance plans, obviously, but their health care expenses can add up quickly.
For example, my cat Hemingway takes several medications for congestive heart failure, a thyroid problem and kidney issues. We purchase Hemingway’s clopidogrel (that’s the generic for Plavix, a medication that prevents blood clots to reduce our fur baby’s chances of having a stroke or embolism) at our local CVS pharmacy. By presenting our GoodRx card each time we refill the prescription, we get the pills at a steep discount — just a few dollars for each refill instead of the roughly $30 the prescription would cost without that discount.
[READ Pain and OTC Medications: Which Is Best?]
What Is Medicare Part D?
There are several parts of Medicare, the federal health insurance program designed to cover people age 65 and older and some younger individuals with disabilities. Medicare Part D is an elective benefit offered by private insurance companies to cover some or all of the cost of certain prescription drugs.
Each Part D plan has its own list of what’s covered called a formulary. That formulary can change from year to year. Depending on the specifics of your coverage, prices and benefits can also fluctuate. Therefore, it’s important to check the formulary of any Medicare Part D plan you’re looking to purchase during each annual enrollment period to ensure that the medications you need are included.
Whitney Stidom, vice president of Medicare operations with eHealth Inc., a health insurance broker and online resource provider headquartered in Santa Clara, California, encourages all seniors to secure Part D coverage.
“Everyone on Medicare needs prescription drug coverage,” she points out. “It’s no secret that prescription drugs can be costly, especially without insurance. As a Medicare beneficiary, enrolling in drug coverage is one of the best things you can do to shield yourself from medical expenses.”
[READ: What Medicare Does Not Cover.]
Do GoodRx and Medicare Part D Work Together?
GoodRx and Medicare can work together. However, you do not need to use both your Medicare card and GoodRx.
“You use one or the other, but most pharmacists are happy to look at both prices and give you the cheaper one,” Hirsch notes.
GoodRx can help with Medicare coverage gaps
If a medication you need isn’t covered by Part D, you’ll have to pay for it out of pocket, which can get expensive. GoodRx, however, can often reduce the cost if you’re prescribed a medication that’s not included in your coverage plan.
GoodRx can also help reduce costs when you’re in the coverage gap phase, sometimes called the donut hole, of your Medicare plan. That’s the period when you and your drug plan have spent a certain amount for covered drugs. In 2024, that gap starts after you and your plan have spent $5,030 on covered drugs. When you enter the coverage gap, you’ll qualify for a discounted rate to buy prescriptions at the pharmacy or order them through the mail. GoodRx can further reduce those costs.
You can submit claims to your Medicare plan to get credit for spending that’s occurred via GoodRx if you’re trying to meet a certain deductible. You can also use the GoodRx app or website during your annual enrollment period to research drug prices, which may help you make the best selection of Part D plans available to you.
What Are the Downsides of Using GoodRx?
There aren’t many downsides of using GoodRx. However, relying on GoodRx as your sole source of prescription medication coverage is not what it was designed for, and it’s best to purchase prescription drug coverage as part of your health insurance selections.
“I’m not saying to ignore insurance,” Hirsch explains. “You really do need insurance, especially for name brand drugs to find your maximum savings.”
GoodRx can work alongside health insurance prescription benefits to reduce cost and help people become savvier consumers of health care.
“We’re in the information and education business primarily, and we’re offering discounts that hopefully can provide assistance,” Hirsch adds. “You can shop around and actually actively manage your health care budget.”
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How Does GoodRx Work With Medicare? originally appeared on usnews.com
