Wal-Mart rolls out nationwide prescription discounts

I had an item on my desktop from a couple of months ago about Wal-Mart's pilot program in Florida to offer 30 day fills of generic prescription drugs for $4. I had mixed feelings about it. On the one hand, it could help the uninsured, underinsured, and those without prescription benefits on their insurance. On the other hand, you have to wonder if this is a loss leader that will also put competitive pressure on locally owned and operated independent drug stores.

Wal-Mart announced yesterday that they are rolling out the program in Tennessee and ten other states ahead of schedule:

Today's announcement brought 11 new states with a total of 811 pharmacies into the $4 generics program. Along with Tennessee, the new states are California, Colorado, Connecticut, Hawaii, Louisiana, Minnesota, Montana, Pennsylvania, Wisconsin and Wyoming. The program kicked off in Florida in September, with plans to spread outside the state in January 2007. However, customer demand led Wal-Mart to accelerate the rollout of the program - now available in all 3,810 pharmacies in 49 states.

According to the press release, the only state not covered is North Dakota, because Wal-Mart does not operate pharmacies there.

Wal-Mart is getting rave reviews for the program in newspapers and other media outlets across the country. In that respect they appear to have scored a public relations coup.

Wal-Mart's pricing prompted other national retailers, including Target, to offer similar discounts. Perhaps this news from a week ago was a factor in Wal-Mart's decision to accelerate the rollout:

Target Corp. expanded its $4 generic drug program to all of its U.S. pharmacies Monday, moving beyond states where it was matching a plan offered by rival Wal-Mart Stores Inc.

Target said all of its 1,287 pharmacies across the United States would offer some generic versions of drugs at $4 for a 30-day supply. The discount retailer had previously matched the list of drugs being sold for $4 at Wal-Mart, but only in states where Wal-Mart was offering the plan.

Now, Target is selling $4 generic drugs in nine states where Wal-Mart has not yet rolled out its program: California, Colorado, Connecticut, Louisiana, Minnesota, Montana, Pennsylvania, Tennessee and Wisconsin.

Note the list of states mentioned by Target and the list of states mentioned in the Wal-Mart press release.

At any rate, this is how free markets are supposed work, and the competition benefits consumers, right? Well, maybe not. According to this article in the Akron Ohio Beacon Journal, drug specials are not a cure-all:

Only a fraction of all medicines are covered, said Carol Risaliti, executive director of the Stark Prescription Assistance Network, which helps Stark County residents who can't afford their medicines.

[..]It's not unusual for large retailers to sell select products at a loss as a way to lure more customers and attempt to boost overall store profits, as is the case with the $4 promotion.

Large mass merchants rely on pharmacy sales for only 5 to 10 percent of revenue, compared to 60 to 70 percent for chain drugstores and 90 percent or more for independent pharmacies, [Ernie Boyd, executive director of the Ohio Pharmacists Association] said.

[..]Patients also put themselves at risk if they fill prescriptions at numerous pharmacies, he said.

"If you start scattering your scripts all over, we can't do a good job looking for drug interactions, mistakes and wrong doses," Boyd said. "We catch three mistakes per day per pharmacist. That's 30,000 per day in Ohio, one-third of which would have injured the patients had we not caught them."

Further, the Knoxville News Sentinel here in Tennessee talked to some local pharmacists, and found that $4 prescriptions aren't necessarily all that new:

But Knoxville pharmacist Hank Peck said he's been selling $4 generic drugs to his customers long before big-box retailers Wal-Mart and Target announced their new low-price prescription programs.

Peck, the owner of Long's Drug Store on Kingston Pike, said a lot of generics sell for even less and he isn't sure why the retailers are making a big fuss.

"They're creating an awareness that's not anything new," Peck said. "A lot of things on their list are not different from what we're charging already."

Bob Boyd, a pharmacist and owner of Norwood Pharmacy off Merchants Drive, called the move "kind of misleading."

"There are a lot of $4 drugs out there already," Boyd said.

At Belew Drugs on Broadway, many customers are on TennCare. Most of the $4 drugs being offered by Wal-Mart and Target already are on a short list of medications that TennCare recipients get for free.

The National Community Pharmacists Association says that Wal-Mart's discount prescription plan is a "PR stunt" and a "Bait and Switch" tactic. From their "PR stunt" press release:

The National Community Pharmacists Association (NCPA) today said Wal-Mart's widely publicized generic drug program will provide minimal benefit to most patients because of the very limited number of medications included on the list of drugs that are covered.

[..]"If you look at the list of medications they are offering for $4, it represents about one percent of the total number of drugs available," said NCPA Executive Vice President and CEO Bruce Roberts, RPh. "The question people should be asking Wal-Mart is, 'What will you be charging for the other 99 percent of the medications that people need?'"

There are more than 11,000 drugs listed by the Food and Drug Administration, and while the Wal-Mart program claims to offer more than 300 medicines, its list actually includes fewer than 150 different drugs.

For example, 12 different versions of the antibiotic amoxicillin are included on the list.

Many older medications are on the list, and newer, replacement medications that often work better or have fewer side effects are not included.

"Wal-Mart's original list included none of the generic statins used to treat high cholesterol," Roberts said. "After much criticism, the company added the oldest and weakest one and with one of the worst profiles for side effects. Patients deserve good care. Instead they are being used by Wal-Mart just to drive traffic to their stores."

In addition to concerns about patient safety, the NCPA is concerned about "the anti-competitive aspects of Wal-Mart's action":

Wal-Mart is known for driving small-town businesses out of business through deceptive and predatory pricing practices and then raising prices on prescription drugs and other health-related products.

"Prescription medicines are not a commodity like T-shirts and DVDs," Roberts said. "Community pharmacists are in the health care business and provide a value to patients no matter what medications they are taking. We are concerned that patients will be both misled and disappointed by the limited number of medicines in this new program."

Independent community pharmacists are clearly biased, but perhaps rightly so. If you share their concerns, there are alternatives.

United Networks of America, a benefit management company, offers anyone a free, no-strings-attached prescription discount card just for entering your name and e-mail address at their website. You get their pharmacy benefit management negotiated discounts at thousands of retailers nationwide.

I have one of these cards obtained through a local affiliate, Advantage Wellness of America, who had the innovative idea to partner with local county governments to sponsor the discount program in Knox County and Blount County. The county governments get fifty cents for their general fund from every prescription filled by a cardholder, and cardholders get discounts up to 70% on prescriptions, with the average being around 32%.

You can check prices at your local pharmacy from any of the above links to see how much you could save. You might also want to check to see if there's a similar county-sponsored program in your area. If not, the UNARxCard link above is available to anyone in the U.S. The discounts are the same. I've been using the county sponsored card for a while, and it's great for those of us who don't have a pharmacy benefit with their health insurance plan.