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Drug distributors secretly skimming billions from the public


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2018 Sep 12, 7:59am   1,138 views  3 comments

by Patrick   ➕follow (55)   💰tip   ignore  

https://www.bloomberg.com/graphics/2018-drug-spread-pricing/

Not everybody reads the legal notices inside the Ottumwa Courier. But in January, Iowa pharmacist Mark Frahm noticed something unusual in the paper.

For years, Frahm’s South Side Drug bought pills from distributors, and dispensed prescriptions to the Wapello County jail. In turn, the pharmacy got reimbursed for the drugs by CVS Health Corp., which managed the county’s drug benefits plan.

As he compared the newspaper notice with his own records, and then with the county’s, Frahm saw that for a bottle of generic antipsychotic pills, CVS had billed Wapello County $198.22. But South Side Drug was reimbursed just $5.73.

So why was CVS charging almost $200 for a bottle of pills that it told the pharmacy was worth less than $6? And what was the company doing with the other $192.49?

Frahm had stumbled across what’s known as spread pricing, where companies like CVS mark up—sometimes dramatically—the difference between the amount they reimburse pharmacies for a drug and the amount they charge their clients.

It’s where pharmacy benefit managers (PBMs) like CVS make a part of their profit. But Frahm says he didn’t think the spread could be thousands of percent.

“Middlemen have to make some money, but we didn’t expect it to be this extreme,” said Frahm, who said his pharmacy lost money in the jail account last year because CVS paid so little. “We figured everyone was playing fair.”

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1   Goran_K   2018 Sep 12, 8:41am  

Don't worry Single payer ....... supressed laughter will save......... dying of laughter ....... people money ........ tearing up .............like it has in other countries.
2   bob2356   2018 Sep 12, 11:27am  

Goran_K says

Don't worry Single payer ....... supressed laughter will save......... dying of laughter ....... people money ........ tearing up .............like it has in other countries.


How is this single payer? It's a contract to a private company. Free market at it's best. There wouldn't be tens of thousands of contacts to be managed by every podunk rinky dink government under single payer.
3   Goran_K   2018 Sep 12, 11:44am  

bob2356 says
How is this single payer? It's a contract to a private company. Free market at it's best. There wouldn't be tens of thousands of contacts to be managed by every podunk rinky dink government under single payer.


No, it would just be the government engaging in price setting and market regulation which has always lead to lower costs and more efficient distribution of services, because governments are not corrupt, totally efficient, and are great at price discovery, right?

Fucking hell man.

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