Cost Plus Drugs Might Save Medicare Members Money — With a Catch

Invoice Hearn’s remedy to deal with his delicate power obstructive pulmonary illness, or COPD, would price him $275 per 30 days from CVS Pharmacy by his Medicare Half D prescription drug plan. However the 69-year-old retiree dwelling in Knoxville, Tennessee, will get a generic model delivered from a brand new on-line pharmacy, as a substitute. It prices tons of of {dollars} much less.

“I’d learn some about Costplusdrugs.com on Twitter, so I made a decision to test it out,” Hearn stated in an e mail. “Their web site may be very straightforward to make use of to examine availability and costs, and I used to be shocked to discover a $75 per 30 days value for a similar remedy (as a generic). The worth was lowered to $60.50 final 12 months.”

Price Plus Medication can supply important financial savings on sure prescribed drugs, however there are some downsides, too — significantly for individuals with Medicare. Right here’s what Medicare beneficiaries ought to find out about this on-line pharmacy.

The Mark Cuban Price Plus Drug Co., or Price Plus Medication, is a web based pharmacy for generic medicines. The corporate, which launched in January 2022, takes its title from investor Mark Cuban, a billionaire entrepreneur and philanthropist.

Price Plus Medication says it sells “greater than 700 of probably the most generally prescribed generic medicines.” It doesn’t promote any brand-name medication or specialty medication.

Price Plus Medication is notable for providing low-cost medicines with clear pricing. “Each product we promote is priced precisely the identical manner: our price plus 15%, plus the pharmacy charge, if any,” the corporate’s web site says about its pricing mannequin.

Price Plus Medication provides this instance for a 30-count provide of 400 milligrams of Imatinib, a most cancers drug:

• Manufacturing price: $31.20.

• 15% markup: $4.80 (rounded per tablet).

• Pharmacy labor (the “pharmacy charge”): $3.

Together with the transport, that might be $44 per 30 days.

This value provides financial savings of greater than $9,600 versus different firms’ retail costs, the corporate says. That comparability might be primarily based on brand-name Gleevec, which may price $10,000 or extra per 30 days at retail. Generic Imatinib is less expensive, however it will possibly nonetheless be properly over $100 per 30 days from main retail pharmacies with a Medicare prescription drug plan.

“We’re cheaper than Medicare copays, so we’re an important place for Medicare recipients to purchase medicines,” Mark Cuban wrote in a Twitter direct message.

If you wish to purchase these lower-cost medicines from Price Plus Medication, your Medicare plan gained’t be concerned. Price Plus Medication doesn’t invoice Medicare, whether or not you’ve gotten a stand-alone Medicare Half D plan or a Medicare Benefit plan with prescription drug protection. You’d must pay for medicines from Price Plus Medication out of your personal pocket, however it might be properly price doing.

You don’t get any credit score towards your Half D deductible if you fill a prescription by Price Plus Medication. You solely meet the Half D deductible by paying for medication your plan is protecting, and Price Plus Medication doesn’t invoice Medicare Half D plans.

You may nonetheless meet your Medicare Half D deductible by paying for different medication your plan covers. For instance, Price Plus Medication doesn’t promote brand-name medication, so you can fill brand-name prescriptions by your Half D plan and meet the deductible that manner.

If you happen to fill most or all your prescriptions by Price Plus Medication, although, you’re doubtlessly lacking out on loads of credit score towards your deductible. You continue to must pay your premiums, however till you hit the deductible, your Medicare Half D plan doesn’t pay in your medication.

If you happen to take largely or fully generic medication, it could be tempting to make use of Price Plus Medication and go with out Medicare Half D protection. Nevertheless, you can face the Medicare Half D late enrollment penalty. You’ll must have both Medicare Half D or one other sort of creditable protection (reminiscent of an employer plan) that’s at the least pretty much as good as Medicare Half D to keep away from being penalized.

Even if you happen to might get monetary savings through the use of Price Plus Medication and skipping Medicare Half D, you’d face the Half D penalty if you happen to ever join (or signal again up) for Medicare Half D.

The Medicare Half D late enrollment penalty is 1% of the nationwide base beneficiary premium — $32.74 per 30 days in 2023 — for every full month that you just didn’t have qualifying prescription drug protection, rounded to the closest 10 cents.

For instance, if you happen to went with out protection for 2 years, or 24 months, your month-to-month penalty can be 24% of $32.74, or $7.90 (rounded to the closest 10 cents), in 2023. That quantity is added to your premiums each month. It will go up or down in subsequent years primarily based on the nationwide base beneficiary premium, nevertheless it doesn’t ever go away.

Price Plus Medication isn’t fully against working with insurance coverage firms. As of February 2023, Price Plus Medication solely works with one insurance coverage plan — Capital Blue Cross — however the firm’s web site says “we will likely be including extra insurance coverage within the coming months.”

Cuban described the corporate in a Twitter direct message as “prepared and in a position to combine” with authorities applications like Medicare, and added “however now we have not had these discussions but.”

If Medicare or Medicare Benefit firms made agreements with Price Plus Medication, it might critically shake up drug pricing. “If we might promote to Medicare, we might save taxpayers tens of billions of {dollars},” Cuban wrote.

A 2022 research revealed within the Annals of Inside Medication estimates that Medicare might have saved about $3.3 billion in 2020 if it had purchased a subset of medicine out there from Price Plus Medication on the firm’s charges. (For context, the whole Medicare Half D price range for fiscal 12 months 2020 was about $89 billion, in keeping with the Congressional Price range Workplace.)

Medicare beneficiaries had a mean of 54 prescriptions per 12 months as of 2018, in keeping with information evaluation by the Congressional Price range Workplace. Within the information, one prescription equals a 30-day provide, in order that’s about 4.5 prescription fills per 30 days. Saving cash on even a portion of these could possibly be a giant deal for Medicare beneficiaries.

Price Plus Medication could possibly be a superb possibility for potential financial savings on generic medication, even for individuals who already produce other Medicare prescription drug protection.

Nevertheless, there are additionally some Medicare-specific downsides to Price Plus Medication. Notice these further concerns:

• Prescriptions stuffed by Price Plus Medication don’t depend towards the Medicare Half D deductible.

• Price Plus Medication doesn’t promote brand-name medication (which are typically the most costly).

• You’d owe steep and everlasting penalties for going with out Medicare Half D protection, so it’s not a good suggestion to drop your Half D plan, even when you may get cheaper remedy from Price Plus Medication.

Briefly, if you happen to take a drug with a generic model, it’s price checking the value on Price Plus Medication to see whether or not you can doubtlessly get monetary savings. However Price Plus Medication isn’t a alternative for Medicare Half D, so take care to not run afoul of penalties that might add as much as greater than you save on prescriptions.