It’s understandable why so many county officials raise a suspicious eye when it comes to joining the National Association of Counties just for a chance to participate in its discount prescription drug card program.
The association’s description of the program – free to counties, saves residents money, good on all prescriptions at all major pharmacies, requires no administrative paperwork – kind of makes it sound like there’s gotta be something wrong with it. It’s that sick horse at the auction, the car that looks pretty but needs a new transmission in the used sales lot, the fine print that tells you exactly what hoops you have to jump through to win that promised gift off the Internet.
There’s no such thing as a free lunch, and only a fool gives away something for nothing, right, so where is the fine print and what’s the catch?
But as the program has caught on in Texas, officials and those familiar with the program are all relaying the same messages: there is no catch, it’s all true, and hop on board.
“We heard about it, we investigated it, we had our assistant attorney look at the contractual obligations and then took it to Commissioners Court,” said Susan Patterson, the treasurer in Comal County, which started passing out the discount prescription drug cards in May 2006. “There is no catch.”
The NACo Prescription Drug Card is a discount card that the National Association of Counties offers to any county that is a member of the association. While there are membership fees for NACo, the prescription drug cards are free, and counties, once they begin participation the program, can hand out an unlimited supply of the cards to their residents, via schools, senior centers, health departments and clinics, pharmacies, non-profit organizations or back pockets.
As far as the county and residents are concerned, once a person has the card, all they have to do is show it the next time they need any prescription drugs filled. For the resident, there is no paperwork, no membership, no age requirements, no income requirements, no medical condition restrictions, no enrollment fees.
Counties fill out a form through NACo to receive their cards, then hand them out to residents. NACo also supplies marketing materials, including posters and pre-written press releases, to help counties publicize the new benefit being offered to residents. Once a month, the county receives a report updating them on how much their residents have saved using their NACo discount cards.
And … that’s just about everything.“We have worked very hard to make this the most turn-key program possible,” said Andrew Goldschmidt, NACo’s director of membership and marketing. “We provide an extensive variety of resources online, including a media kit, power point presentation, frequently asked questions, Q and A, testimonials from around the country, pre-written press releases. I think people are surprised by how little work the county has to invest in this for it to be successful.”
NACo first implemented the prescription drug card program as a pilot project back in 2004, after several county officials from across the country began asking its Board of Directors to investigate the high cost of prescription drugs and see if there was anything the association could do about it.
“When something gets repeated quite frequently, it’s a signal that it’s something people really need,” Goldschmidt said, adding that NACo first started recognizing the need back in 2001, and that it didn’t take long for the board’s directors to determine that it would be a good idea to have the association use counties’ nationwide buying power to lower the cost of prescription drugs for residents.
It did take some time, however, to come up with the best way to implement that idea. “I personally spent about a year researching the prescription drug industry and developing a request for proposals for NACo on behalf of the membership committee,” Goldschmidt said, adding that the RFP resulted in proposals for public-private alliances with five different pharmaceutical services companies. A special task force was created to investigate each of the proposals, using three main criteria: price, ease of use and understanding and size of the participating pharmacy network.
In the end, the Caremark proposal won out. First, Goldschmidt said, because it had the best pricing schedule, meaning the company was constantly renegotiating the discount prices with prescription drug manufacturers and pharmacies. Second, the program was the clear winner in terms of ease of use, because there were no costs, no money changing hands and counties didn’t have to keep track of any records. And third, Caremark’s existing participating pharmacy network includes 59,000 pharmacies, nationwide.
“All the major chains, all inclusive, are a part of the program, no exception, and most of the independent pharmacists also participate in the Caremark program,” Goldschmidt said.
Basically, to work, Caremark uses its own purchasing power to negotiate prices on prescription drugs with both manufacturers and pharmacies. As Caremark’s purchasing power increases, so do the discounts. Manufacturers work with Caremark because it means having one large customer to sell their products to; pharmacies sign on because being a part of the Caremark network can increase foot traffic in their stores, so while they may be losing some profits off of the prescription drugs, they are increasing sales overall.
Theoretically, Goldschmidt admitted, if the program isn’t entirely something for nothing, it’s independent pharmacies who are footing the bill. But many of them do end up supporting the program because they see the benefits for their customers and neighbors who may be struggling to afford the prescription drugs they need.
“Pharmacists are looking to create goodwill and increase business,” Goldschmidt said, adding that participation in the program is up to the independent pharmacies themselves, who negotiate with Caremark.
In turn for its work, Caremark receives money from transaction fees paid by pharmacies and rebates from the drug manufacturers.
The pilot program, which began with 17 counties, was an immediate success. Once NACo expanded the program, participation quickly grew to 635 counties, with another 500 counties currently looking into the program.
As of Jan. 30, residents using the NACo prescription drug had saved around $21 million on 2,000,000 prescription drugs. The average discount savings per prescription when compared to the actual retail price is at 27 percent, Goldschmidt said, though that savings “has risen almost every month,” he added.
The card can go to any resident in the county, though the discount is only good on a prescription drug’s retail price, meaning that it probably won’t benefit people with good prescription drug coverage whose co-pay is less than the discounted price negotiated by Caremark.
However, the card does cover prescription drugs that may not be covered by a person’s insurance company, as well as prescriptions for pets, so anyone with a dog, cat, horse or goat could benefit.
“What I liked about it so much is that this is a tool to go out into your county and say, ‘This is something your county government is providing you.’ You can distinguish yourself from city government, from state government. County judges, commissioners, clerks, whomever, can carry it along with them and hand it out to residents and say, ‘This is what county government is doing for you,’” said Patterson.
Savings in the Texas counties participating in the program have shown potential, even in areas that are just getting started, though the savings varies greatly from county to county.
Bandera County residents, for instance, saved $16,867.20 from January 2006 through January 2007 on their prescription drugs. In an average month, 42 residents use the card on 99 different prescription
drugs, meaning that many of the residents using the card are using
it to purchase more than one drug. The average savings for those residents was about 21 percent, which figures out to be about $12 or $13 per prescription. For the uninsured and underinsured whom the cards are designed to benefit most, being able to save money on those drugs, even if it’s only $10, is a big deal.
Bandera County Treasurer Kay Welch is one of the program’s biggest supporters. Along with Patterson, Welch has given presentations about the discount card at conferences and is at least partly responsible for the momentum the program gained during the last year in Texas.
“They were really touting it and explaining that it’s a real win-win situation and that people that are uninsured or underinsured really do benefit from this,” said Hays County Treasurer Michelle Tuttle, whose county signed up for the program after she heard about it at a treasurers’ conference.
From May 2006 through January 2007, Comal County residents saved a total of $70,181.71, and the amount saved has increased each month. In Tarrant County, residents saved $48,668.35 in just five months.
In Austin County, which just started the program in December, the few residents already using the discount card saved between 26.6 percent and 54.1 percent off their prescription drugs. Counties with larger participatory programs that had high average percentage savings as of February include Leon at 25.2 percent, Marion at 32.9 percent, Panola at 32.1 percent, San Augustine at 39.7 percent and Zapata at 32.9 percent.
Comal County resident Karen Schwind, a nurse at Carl Schurz Elementary School in New Braunfuls, said the discount card has helped several families at the school.
“With a lot of the Medicaid and (Children’s Health Insurance Program) CHIP changes that occurred right at the end of the year, there are a lot of people that have changes with their insurance. It’s probably a weekly conversation that I have with parents that have lost their insurance for one reason or another,” Schwind said.
Whenever parents come to her office and state that they are without prescription drug coverage, she gives them a discount card. “We distributed them to the whole school, but I also have some on hand here because some people, when we distributed them, didn’t think they would need it,” she said. “But I’ve had several families who have used the card who have really decreased the cost of their prescription drugs, especially on inhalers and medications for asthma.
Some of those medicines are very costly, and I’ve had a family that was able to use the cards and decrease the costs of the medications for their kid.”
Reports show that some counties have struggled with promoting the card and with getting residents to remember to use it when purchasing their prescription drugs.
“At first the participation was slow, and it goes in a cycle, from when people start talking about it to when they start needing to have a prescription filled,” said Gillespie County Treasurer Laura Lundquist, who said she’s proud her county is offering the benefit.
“In different places I’ve been, people have actually come up to me and said they really appreciate it. They have actually seen cost savings with it.”
Tuttle, in Hays County, said she has placed cards in senior citizens centers, churches, libraries and the city hall, as well as the county’s health department, jail, tax office and justice center. In all, she estimates about 4,000 to 5,000 cards have been distributed
throughout the county, but only a few residents appear to be taking advantage of the possible savings.
“We did have some articles in the paper,” she said, “but it may be time to do our own PR article and remind people, ‘hey, this is a benefit, if you need any information, please call,’ something. Just to get the word back out there again. You know how sometimes
you hear about something and then you don’t hear about it any more and you forget?”
She added that she “absolutely” thought that the card was worth the effort in promoting it.
“I’ve gone through and talked to all of our employees. I’ve been trying to give them some extras to help their friends and family members too,” Tuttle said. “How many times do you know that your next door neighbor needs some help, or you have a family member that needs some help? … We are all one big family so I just feel like we need to help each other.”
Approximately 35 Texas counties are already participating in the program; about 95 other Texas counties are eligible for the program because they are already NACo members. There are 124 Texas counties that are not members of NACo, but counties can join the association at any time to receive the prescription drug card benefit, as well as other membership benefits.
“You get the benefit of knowing what is going on nationwide, you network with other counties nationwide and that way, you don’t have to reinvent the wheel,” Tuttle said about the other benefits of joining NACo. “They do have a newspaper that comes out on a regular basis and they have some amazing articles in there on what different counties around the country are doing. It may have something to do with HR, or what other health departments are doing with their indigents. Plus, they are trying to group counties together to help create federal legislation that helps counties.”