You could be overpaying for your prescriptions and have no idea. In some cases, pharmacists can't tell you you're paying too much. Even if they wanted to, confidentiality agreements restrict them from notifying consumers of a cheaper price.
This practice is called a clawback and Baltimore County Delegate Eric Bromwell likens it to theft.
“It's absolutely stealing. They're literally taking more than the cost of the drug,” said Maryland State Delegate Eric Bromwell (D-Baltimore County).
The clawback works like this:
The pharmacy benefit manager, or the PBM, is the middleman between the pharmacies, the insurance companies, and the drug manufacturers.
PBMs negotiate with drug manufacturers on a price for a drug. They then negotiate with the insurer for what price the PBM will bill the insurer for that same drug. The PBM has also set the price they will reimburse the pharmacy for that drug in a contract with the pharmacy.
All three of these prices may be different.
“Pharmacy benefit managers put language in their contracts that forbid pharmacists from telling the patient that the cost of the drug is less than the co-pay of the drug,” said Bromwell.
So they charge you more then pocket the difference.
“So it's just a money grab. There's no way to spin this,” said Bromwell.
Bromwell is invested in exposing the practice because it's happened to him.
“I'm a state employee. It's in our contract that it's not supposed to happen but I knew to ask and when I asked, they took $20 off one of my prescriptions,” Bromwell said.
In certain cases, the only way to find out if there's a lower price is if you ask.
Patrick Berryman is the senior vice-president and COO of the National Community Pharmacists Association. He said pharmacists want to say something, but if they did, their business could be at stake. Some PBMs include confidentiality provisions in the pharmacy's contracts with the pharmacy benefit managers that restricts them on what they can say and who they can say it to.
“Pharmacists are very wary of providing information on this situation because there are three big pharmacy benefit managers that control about 80 percent of the marketplace and those contracts are obviously very important to them,” said Berryman.
The hidden practice isn't staying very secret however, pharmacists want this to get out. They want the public to know to ask, so they shared a recent transaction. It happened at a Maryland pharmacy this month.
A patient went to fill their cholesterol-lowering medication. With their insurance, their copay was $30 for a three-month supply. The pharmacy was paid $2.05 for the medication, which means the PBM, or Catamaran in this case, clawed back $27.95.
If the patient were to have asked how much it would’ve cost them to pay without insurance, they would have paid $12 and could have saved $18.
Since this is a daily medication, the patient is overpaying $18 every three months, or $72 a year. Multiply that by five years, and this person is out $360.
“This happens quite often. Pharmacists are seeing it you know 10-15 percent of the time, so it's quite significant, especially on generic products,” said Berryman.
Maryland has a statute banning insurers that provide coverage through PBMs from charging a higher copay than the retail price of the drug.
Delegate Bromwell says most pharmacists are either unaware of the law or are afraid to stand by it. Both instances are reasons why he wants the law strengthened.
“They're more likely to go by the contract that they see in front of them all the time than a law that we have passed in Annapolis,” said Bromwell. “They don't want to do this to their patients but they have to. They're made to by the pharmacy benefit manager.”
Bottom line, the purchaser needs to ask. If there's a copay for your medication, ask the pharmacist, 'how much the drug would be without insurance.' If you find out that you've been overpaying for a medication and for a while, you can file a complaint with the Maryland Insurance Administation.
We asked their office how many complaints they've received on this. They didn't have that information on file but said since we contacted them, they will now begin tracking the number of complaints.
Mallory Sofastaii reached out to multiple PBMs to get a comment on whether they engage in clawbacks. Below are their full responses.
Drug: Generic Crestor 10
- Patient copay $30
- Net pharmacy payment $9
- PBM clawback $21
- Regular cash price $12
Catamaran / October 2017
Drug: Lisinopril 10mg
- Patient Copay $30
- Net pharmacy payment $0.70
- PBM clawback $29.30
- Regular cash price $12
Catamaran / November 2017
ABC2 reached out to Catamaran's parent company, UnitedHealth Group, for comment. This story will be updated with their response.
Our PBM, CVS Caremark’s long standing practice is not to engage in copay clawbacks, and we have no plans to implement clawbacks. If a PBM plan member’s copay for a drug is greater than the dispensing pharmacy’s contracted rate, it is not CVS Caremark’s practice to collect that difference from the pharmacy. If the pharmacy’s cash price is lower than the co-pay, the patient would be charged the lower price.
Mike DeAngelis | CVS Health | Senior Director, Corporate Communications
Express Scripts does not support, or engage in, the anti-patient practice of copay clawbacks. We believe patients should always pay the lowest price possible, whether that is their plan’s copayment, or their pharmacy’s cost for the medication. If a pharmacy’s cost for a member’s medication is lower than the copay, the claim automatically processes at the lower cost. No action is required on behalf of the patient or the pharmacy.
We also believe our members absolutely must have full line of sight as to what a drug will cost them, and should know if there are opportunities to decrease that cost. Express Scripts members always have real-time access to their drug coverage information and copay amounts through our website and mobile app. This information also is available to them during open enrollment. Our members will always know what their specific cost will be for a prescription, based on their individual plan design, copay structure or current deductible status, before they fill their prescription.
We also do not prohibit pharmacies/pharmacists from telling our members when their price for a medication is less than the member’s copay. And we do not require the member to go outside of their benefit to pay the lowest price (i.e. pay cash), meaning they still get the benefits of our real-time clinical safety review of the medication, which we communicate to the pharmacy that fills the medication.
Jennifer Luddy |Express Scripts | Director, Corporate Communications
If you have a Matter for Mallory, email her at Mallory@wmar.com