Roberts: Stung by high prescription prices? You aren't alone (And here's what you can do)

So here I was, thinking it’s unusual for a major chain drug store to charge $198.80 for a prescription you can get for $14.87 elsewhere.

Sure, I’ve heard that it pays to shop around. But $198.80 for a drug that probably costs less than a Big Mac combo meal? In my world, that’s called price gouging.

In the world of medicine, it’s called standard operating procedure.

“Welcome to healthcare finance, where the pricing of any drug or service bears no resemblance to the actual cost,” wrote Holly Cappelletto.

Cappelletto was one of many readers who responded after reading last week’s story of a Phoenix woman’s sticker shock when she went to fill a prescription for her husband, who had just been diagnosed with Alzheimer’s disease.

Even the insured are being gouged

Corinne went to her neighborhood Walgreens and because her husband Ken had no insurance coverage for drugs, paid $198.80 for a 30-day supply of Donepezil.

Later, she found the same drug at Costco, available even to non-members, for $14.87.

Drug stores won’t talk about their pricing strategies. Apparently, it’s akin to revealing a nation’s nuclear launch codes. But others who follow the industry say it’s all about setting the retail price artificially (read: astronomically) high in order to score as much profit as possible when they negotiate discounts with insurance companies that cover the vast majority of their customers.

“The unfortunate side effect is that pharmacies end up soaking the poor,” said Adam J. Fein, president of Philadelphia-based Pembroke Consulting and one of the country’s foremost experts on pharmaceutical economics.

Lest you think you needn’t care because you have insurance, you might want to think again.

More people than ever are encountering the PPG (prescription price gouge), as insurance benefits are slashed and more and more drugs are excluded from coverage.

“More and more, people are outraged that they’re paying $104 for something that costs $5,” said Doug Hirsch, co-founder and co-CEO of GoodRx.

There's something you can do 

After reading my piece on Corinne last week, at least two dozen readers told me about GoodRx. Essentially, it’s the Expedia of prescription drugs, a website where you can compare prices and even find coupons that will dramatically cut the cost – sometimes even below your co-pay if you have insurance.

Hirsch is technology guy who previously worked for Yahoo and Facebook. His only experience with pharmaceuticals was as a “frustrated angry consumer.” In 2011, he needed to get a prescription filled and was shocked at the prices quoted – anywhere from $250 to $400 -- as he went from pharmacy to pharmacy searching for the best deal. One pharmacist even followed him into the parking lot, he said, asking how much he’d be willing to pay.

There wasn’t any information available about what a fair price would be. So he and his friends started scouring various places to find what various pharmacies were charging for various drugs. They put together a database that would allow consumers to comparison shop and GoodRx.com was born. Since then, the Santa Monica-based business has partnered with pharmacy benefit managers to negotiate discounts that are honored by many of the major pharmacies.

These days, five million people a month come to their website. GoodRx is the number one free medical app on Apple and Android, Hirsch said, working with 140,000 doctors.

Blink Health offers a similar service. So does LowestMed. 

What the business lacks: transparency

It’s all about something badly needed in the pharmaceutical biz: transparency.

“Consumers haven’t had the knowledge to be able to actually understand what a fair price is,” Hirsch told me.

Or, in Corinne’s experience, what a fair price isn’t.

Which brings me back to Walgreens and its $198.80 prescription that you can fill at Costco for $14.87.

Or at Sam’s Club for free, provided you’re a member.

Hirsch estimates the actual cost of the drug at around $5.

Scott Goldberg, spokesman for Walgreens, said that the vast majority of its customers have insurance and don’t pay the full retail price. Those who must pay out-of-pocket may qualify for discounts by joining the pharmacy’s Prescriptions Savings Club, he said. Pay $20 to join the club and that $198.80 Donepezil prescription would cost $89.99, he said. However, Corinne’s husband didn’t qualify because he’s on Medicare.

$210.99 - or $11.21 with a coupon

“When choosing a pharmacy, we encourage patients to select one based on overall pricing and the services available – such as participation in government plans, 24/7 convenience and service that can accommodate immediate prescription drug needs,” Goldberg said. “It’s also important for patients to use a single pharmacy so that pharmacists can monitor their medications and avoid potential drug interactions.”

It’s also important that patients don’t go broke because they need medicine to fend off the effects of Alzheimer’s. Or do without because they can’t afford the outrageously inflated prices the drug stores call “usual and customary.”

To be fair, Walgreens isn’t the only one that attaches its drug prices to a rocket ship and launches them skyward. A check this week shows the same prescription at CVS would cost $210.99 if you don’t have insurance.

Interestingly, GoodRx offers a coupon for Donepezil. With that discount, you can get it at Walgreens for $11.21 – a 94 percent savings from the drug store’s retail price.

Apparently, there’s quite the markup on these babies.