TPIR Ep 141 Full Show.mp3: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.
Speaker 1:
Well, if you have prescription drugs that you take on a regular basis, you sometimes know that you know the same drug by maybe a different manufacturer can cost a very different price and can really mean a big hit to your budget. And that's especially true for certain medications.
Speaker 2:
Welcome to Take Pride in Retirement, the podcast dedicated to helping members of the Lgbtq+ community protect and grow their hard earned money, get set for a show full of education and insights with your host and advisor, Matt McClure. We recognize every family is unique. The goal of the show is to help you achieve financial freedom, so you and your loved ones can have the retirement you've always dreamed of, a retirement you can take pride in, no matter who you are, where you're from, or who you love. So now let's start the show. Here's Matt McClure.
Speaker 1:
There's a big new study about this and I want to talk to the man who knows all about it. Antonio Ciaccia, who is president of 46 Brooklyn. Antonio, thank you so much for being here. Really appreciate your time.
Speaker 3:
Hey, thanks for having me.
Speaker 1:
You know, most people, I think as a kind of start off here, would assume that if there's kind of a newer drug on the market. Obviously the newer drugs are going to be more expensive, but then a generic comes to market and that means the price is going to fall. But what did the research actually show when you sort of dug into it here?
Speaker 3:
Yeah. The reality is, is that while generic competition usually works, you could see drugs that could be $300 a pill and within a two year period could actually be acquired by pharmacies for less than a dollar per pill. That means the marketplace is working. Unfortunately, we don't pay based upon what the pharmacy buys the drug for. We pay based upon whatever the sticker price is going to be or whatever our insurance company and pharmacy benefit manager negotiate on our behalf. Most people assume that the insurance company and that PBM, that pharmacy benefit manager are actively working on our behalf. But much like everybody else in the supply chain, they're part of publicly traded companies that work on their own behalf. They work for shareholders, and they too, have their proverbial hand in the cookie jar. So despite the fact that the marketplace is working and generic competition is really lowering the underlying cost of medicines, that doesn't stop the intermediaries in the supply chain from buying low and selling high and making sure that we ended up, or we end up overpaying for medicines that are actually very cheap.
Speaker 1:
Yeah, you're beholden to shareholders. You've got to return a profit. And that's, that's what, um, that's what will happen in, in those particular scenarios. And the study also found, you know, that Medicare actually paid an average of was it almost, almost $2,800 for one prescription in particular, this was I'm probably going to butcher the name of it, but it's abiraterone, I guess is maybe how you pronounce it. The generics always get me. But anyway, pharmacies could acquire this is about $2,800 for Medicare paying that. But pharmacies can actually acquire that for about 188 bucks. So it's crazy that discrepancy. How can such a big pricing gap exist within Medicare Part D?
Speaker 3:
Well, most people think that we're operating in a free market. The reality is it's a free for all. Uh, at the end of the day, every publicly traded company wants to make more money off the prices of medicines, understandably so. It's it's just it is inherent in their nature. But the problem is, is that we just trust that the same companies that are pricing medicines that also profit from the pricing of that they set are going to essentially just give us a great deal. It's not it's not the truth. You know, what happens is, is that every, every opportunity there is to markup a a drug knowing full well that we, the consumers, don't understand what a fair price is. Most of the time the true prices of drugs are are under lock and key. So our ability to shop around is very much compromised in this marketplace. So you can imagine how strange it is to somebody who looks at drug prices all day, every day to find that there are medicines that some people will sell for $200 or $100, but are being sold for thousands. So that doesn't just impact our Medicare program and senior citizens. It impacts government programs in Medicaid. It impacts employers. It impacts other government programs outside the military. In our study, we found that despite the fact that Mark Cuban Cost Plus Drug Company would sell this drug abiraterone for less than $100, despite the fact that pharmacies could acquire this drug for around $100. These pharmacy benefit managers that are operating on behalf of our Medicare, Medicaid and employer programs are finding or selling this drug to patients and the plans for over $10,000 in some instances. So while $2,000 and change might be the average in the Medicare program, everyone knows what an average is, right? It's going to be a story of the middle between bookends of lower and higher, and this drug, which could be clipping at 100 bucks. We've seen it sold for as much as $12,000.
Speaker 1:
Wow. I mean, that that's just a crazy, crazy discrepancy there. And, you know, I mean, a lot of times I think in, you know, when I was looking at this, this study, a lot of times it just has to do with sort of the label that you put on the drug or the category that the particular drug is in. If you categorize it as a specialty drug that can keep those prices artificially high, what does that categorization actually mean?
Speaker 3:
Yeah. Imagine as though you were to buy, you know, a very old Toyota Corolla and essentially take the entirety of the inside of the car and then put a Lamborghini over top of it, right? I would say that is the equivalent of what's happening in the drug supply chain, where we take very cheap generic drugs. And for whatever reason, the PBMs will name them or call them specialty drugs. And so all of a sudden you hear that, you're like, oh my goodness, a special drug. Well, of course it's expensive. Well, it's essentially just labeling something. The truth is, is that many of these drugs are sitting on the same pharmacy shelves with the cheap drugs that are worth a dollar or two, but because they slap a label on them that says special, that gives them the ability to price it higher and force the patient to get that drug at the specialty pharmacy that's owned by the same parent, PBM Corporation. So think of it this way. As soon as a PBM slaps that label on it and says it's special, now they can force you to get it at a specialty pharmacy that they own. So when they overcharge you for that drug, their own pharmacies are the ones that benefit from that obscene markup.
Speaker 1:
It's just it's crazy. Well, and so we've we've laid out the problem, I think, here pretty thoroughly. What about, I guess, some semblance of a solution anyway? Or even maybe a workaround for people who are approaching Medicare eligibility age, getting close to that 65 years of age? What sort of practical steps can people take when comparing part D plans, or maybe filling out, uh, or filling an expensive prescription that is to avoid paying more than necessary?
Speaker 3:
Well, so we have our own tools at 46 brooklyn.com, where we take Medicare formulary and pricing files and parse them out so that you can actually go in and look at what the prevailing prices are for every medicine under any benefit plan. Now, be clear that data isn't perfect, but it gives you a good sense as to what you might expect from a given plan from one to another. And because every plan prices drugs differently from one to the next, your specific cocktail of drugs that you might be on could be cheaper in one plan versus another. Whereas if you were on other medicines, the opposite could be true. So as a consumer, I implore you to try and shop around as best as possible. Beyond the part D plans, remember that sometimes getting your medicine through your insurance company is not the best thing. So don't be afraid to shop around. Talk to your pharmacist. First and foremost. Look online to see if there are cash. Pay pharmacies that are offering your drugs at a cheaper price than what your insurance plan are offering. And then again, make sure you're talking to your pharmacist because your pharmacist knows everything there is to know about the drug and hopefully can navigate you to more affordable options as well.
Speaker 1:
All right. Very good. Well, Antonio Ciaccia with 46 Brooklyn, we're going to send folks to that website as well. 46 brooklyn.com. It's the number for the number six. Brooklyn.com is the website there. And you can find out. I'm sure a lot of great information and access some of those tools. Antonio, thank you so much. Really appreciate it and hope to talk to you again soon.
Speaker 4:
Hey, thanks for having me.
Speaker 2:
Thanks for listening. To Take Pride in Retirement, members of the Lgbtq+ community deserve to work with a fiduciary financial advisor who puts their needs first. To schedule a free, no obligation consultation with Matt McClure and the team at Active Wealth Management, call (855) 246-9211 or go online to take pride in retirement.com. Investment advisory services offered through Brookstone Capital Management, LLC, a registered investment advisor. Bcm and Active Wealth Management Incorporated are independent of each other. Insurance products and services are not offered through BCM but are offered in sold through individually licensed and appointed agents.
Speaker 1:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment, and is not a solicitation or recommendation of any investment strategy.
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