Prescription card mailings raise concern
Reno residents are receiving them, and though they're apparently legit, caution is urged on discount and privacy assurances.
A free prescription discount card from a company with United States in its name and a Washington, D.C., mailing address began arriving in mailboxes in Reno County this week.
The mailing, emblazoned in several places with the phrase "Form 1013" and containing a "resident code" rather than a recipient's address, looks like an official government notice, opined Reno County Department of Aging Director Barbara Lilyhorn, who is familiar through her job with government forms. Nowhere in the literature is there a claim of government sponsorship or an affiliation with federal health programs. But that doesn't make Lilyhorn feel any better about the mailing, arriving during a period when qualifying seniors must enroll or re-enroll for Medicare prescription coverage.
A bit of Internet research into the company and discussion with local and state pharmacy reps indicate the company is apparently legitimate - insofar as it offers a prescription discount via a contract with a large drug management corporation.
But it also raises a number of red flags consumers should be aware of before taking the card to their local pharmacist.
In many cases, advised Don Kaufman at Fraese Drug, using the card may actually cost consumers more.
And it may also open the user to a barrage of targeted marketing by other companies.
"Most discount cards, in our estimation, are worthless," Kaufman said. "Ninety-nine percent of the time, when we run those through, our cash price is less than what the discount price is. If a customer brings one in and wants us to run it through to save money, we do that. We want to keep our customers happy. It does guarantee a price, but it's usually not as low as you can get if you shop around. Nine out of 10 times, our price is lower."
Who?
The company, United States Prescription Discounts, is a subsidiary of New York-based Script Relief LLC, which itself is a subsidiary of LOEB Enterprises. LOEB formed the LLC in October 2011. The company's D.C. address listed in the mailing is actually just a Post Office box.
Other names used by the company for its discount prescription cards, according to the Better Business Bureau of New York, include Alternate Help Rx, National Prescription Savings Network, RxRelief and The Healthcare Alliance.
Better Business Bureaus in several states have received complaints about the company's literature, which promises on the discount card itself savings "up to 75 percent on all FDA-approved drugs at pharmacies everywhere," and in the enclosed literature, "an average 50 percent on all your prescription medicines."
On its website, and in information in a booklet in the mailing, however, the company advises that the card is intended for people who are uninsured, underinsured, in the Medicare "doughnut hole," or for purchasing a prescription not covered by their insurer's formulary.
Also, the discounts, the company responded in a BBB complaint, are off the manufacturer's suggested price.
"Our program is not designed to add discounts to discounts you are already receiving from your current provider, nor is it designed to reduce your co-pay," the website for Script Relief advises.
And while it may be used to discount drugs for patients in the Medicare Part D supplement gap or "doughnut hole," drugs purchased using the discount card can't be counted toward the Medicare deductible to get out of that doughnut hole.
The payoff?
The card is free and it doesn't require that users register with the company to use it or fill out any forms or paperwork. So what does the company gain when a consumer uses the card?
Apparently two things: The company acts as a middleman between the pharmacy and the company actually purchasing drugs in bulk - Catamaran - and it collects a fee from the pharmacy for each transaction submitted; and when the card is used, Kaufman noted, the personal information attached to the purchase is forwarded to the company in order to complete the transaction.
Scrip Relief promises in literature in its mailing that "Your privacy is protected by the Health Insurance Portability and Accountability Act," and that it "will never sell or rent any personal information with a third party."
Within the privacy policy on it website, however, the company states that use of its services doesn't create a "... confidential, or privileged, relationship, or any other relationship that would give rise to any (HIPPA privacy) duties on the part of the Script Relief."
Elsewhere the site offers the caveat that it's not responsible for the privacy practices of websites linked to or integrated into its sites, "including the sites of our partners," and it states: "We may contact you from time to time about our website, or other affiliated Script Relief services we believe may be of interest to you."
In other words, the personal information may be given to related marketing companies, a.k.a. LOEB Enterprises, owned by Michael Loeb, which identifies itself on its website as "experts at influencing consumer behavior. We combine sophisticated targeting and segmentation with a deep understanding of market dynamics."
The company has been involved in three different ventures since it was formed in 1992, its website says: the Synapse Group Inc., which developed a process of automatically renewing annual magazine subscriptions, rather than soliciting renewals every year; Priceline, conceived by partner Jay Walker in 1995, as a means of offering consumers discounted airfares and travel accommodations via a "name your own price" auction model on the Internet; and Script Relief.
Buyer beware
"There are a variety of (discount cards) out there," said Chellie Ortiz, vice president of operations for the Kansas Independent Pharmacy Service Corporation. "There's no way somebody is going to say, 'I don't do anything but offer these fabulous cards.' There's got to be a financial benefit, whether its value-added, to make what they're selling look better, or they're charging patients $20 a month, or it's an outside vendor collecting data from the prescriptions and reselling it."
Like Kaufman, Ortiz noted that a pharmacy's discounted price is often less than offered by the discount card, and some pharmacies offer their own discount card.
"We encourage patients to talk to their pharmacist, to see what options they recommend," Ortiz said. "And look at generics. If a generic can be used, it's often much less expensive than with a discount card."
And remember the adage, said both Ortiz and Natalie Goertzen, assistant director at the Reno County Department of Aging: "If it looks too good to be true, it probably is."
"If people have questions about mail they receive, they can bring the info in and we'll look at it," Goertzen said. "If we're in doubt about its legitimacy, it goes to the police."
Source found here.