Wednesday, June 12, 2013

Once upon a time

Wirth-Liss Phramaceuticals makes a hideously expensive drug that has to be administered once a month at the doctor's office. The patient co-pay on most plans is anywhere from $50 a month and up (granted, that's cheap compared to what the insurance company is paying for the rest).

So Wirth-Liss came up with a patient assistance program, where the patient gets $600/year covered by the insurance company, to help lessen the cost burden. Their idea was that this way more patients could afford the drug, so more doctors would order it. I can see the logic.

But the implementation left much to be desired.

Some company genius, with apparently no grasp of reality or human nature, decided the best way to do this was to send every person who qualified for the plan a prepaid credit card with $600 on it. The idea was that Mr. Patient would hand it to the doctor's staff at each visit, it would be swiped for $50 each time, and at the end of the year the card would be empty.

Unfortunately, it didn't occur to them to lock-out the accounts so that they could only be used at a doctor's office...

Basically, they sent patients pre-paid giftcards with $600 on them.

Of course, given human nature, most patients saw this as a windfall, and went on spending sprees. They bought groceries, beer, clothes, toys, a tank of gas, whatever.

Then, when it was time to go to the doctor, they didn't have any money left for the drug. So they opted not to receive it. So the drug wasn't given, and Wirth-Liss Pharmaceuticals, Inc. wasn't able to bill an insurance company for it. And, in fact, they now had a new corporate loss of $600 per irresponsible patient.

Of course, the patients thought this was grossly unfair. They couldn't understand why they couldn't have the drug, when, after all, they'd qualified for the assistance program. The fact that they'd blown their co-pay was beside the point. They also didn't see why they now had to pay cash for the co-pay, since the program person told them they wouldn't have to.

And, of course, they wanted another card.

When the above was explained to them, suddenly they remembered they'd never received the $600 drug card, or it had been stolen, or they hadn't seen it since an alien abduction on the way home from Las Vegas.

The program has since been replaced with one where the card can only be used at a specific doctor's office.

The executive behind it, I hope, has been canned.

The drug reps have the difficult job of explaining the program changes, and why they were made, to doctors and their staffs. Who are laughing hysterically.

17 comments:

Anonymous said...

I bet the executive behind the program blamed an underling, fired her, and was promoted for his decisive role in fixing the problem.

Leslie said...

A blank check - oh that's funny!

Officer Cynical said...

No. of patients per month requiring discount = X

Total monthly cost of discount to pharmaceutical company = Y

Y/X = Discounted price per dose

bunkywise said...

Thanks for rendering me dizzy this morning from shaking my head in disbelief over that story. The idiot exec reminds me a lot of my idiot (former)boss. Heeeeeyyyy....?

Jennifer McHugh said...

Having worked a brief stink with my current employer in a customer "retention" / collection role, I heard sob stories, ad nauseum, about their prepay cards being rejected for soooo many reasons, none of which involve taking personal responsibility for their own actions and finances. In short, it's always the debtors fault they could not pay their bills. (Countless of those people couldn't get a bank account. Gee, I wonder why.)

Packer said...

RX me Doc I need some fast cash.

Anonymous said...

Separate question- independent of anything really-

just how much is the usual co-pay on stupid-pills?

BizzyMomma said...

I had to reply only because my authentic code to 'verify I am not a robot' below was
'confidence thief'! Seems appropriate for the above story!

Mrs. Solanaceae said...

And you expect me to trust THEM with what I put in my body? I'll take the people who came up with Joe Camel any day.

Anonymous said...

Amazing stupidity on the part of the executive.

Amazing sense of entitlement on the part of the patients.

Crazy RxMan said...

If you're going to charge a co-pay and then give money to people to pay for the co-pay, doesn't it make more sense to just not charge a co-pay?

Am I missing something here?

Marc Cabot said...

The drug company has no control over the co-pay, CRM. That's in the insurance plans, and it's established by various rules. What the drug company did was try to give a cash subsidy so that at least *part* of the co-pay would be covered.

The reason this makes sense goes as follows:

A dose of Tohellwithitoll (the advanced extended-release 1.65% version of that hoary old off-patent Fukitoll) costs $1,000 retail, and must be administered monthly.

Purple Pentagon Insurance, a representative insurance company with tentacl... I mean, subsidiaries in most states, will pay $800 for the drug, and requires co-pays on a sliding scale up to a maximum of $50 per prescription. (Which is actually quite low, but for the sake of the argument.)

Wirth-less sees that a major insurer, with millions of covered insureds, is going to make them pay $50/mo for their Tohellwithitoll, in exchange for which Wirth-less will get approximately $800 ($750 from the insurer, $50 from the patient, less some ungodly small amount for the pharmacy/dispenser. No, seriously, ask DrugMonkey, it's ridiculous.) Most big insurers will copy each other's formulary and co-pays, so they can be relatively certain that it's going to cost the average insured about $50/mo out of pocket (today's insurance acronym: "OOP") to gain what would otherwise be the priceless benefits of Tohellwithitoll.

Wirth-less, afraid that the $50/month OOP will prevent people from buying their $800 drug which has a gross profit of $600/dose or so (and that's being pessimistic, it's probably higher) says, "How can we get more people to use Tohellwithitoll? We know! Let's give them their fifty dollars back in advance so they can use it to pay their OOP for the drug, and we'll still make $550/dose, which will buy a lot of hookers and blow at the annual APA convention. Now, how best to do that?"

After that, you get the situation Dr. Grumpy described, where they decided to give them a year's worth of co-pays, in advance, in cash, and were stunned to learn that people will often not use cash for the purpose you intended.

clairesmum said...

"Sum dood musta took my card it's not my fault you gotta get me another one, I gotta have this shit and I don't got no money."
That "sum dood" Is everywhere!

The Bus Driver said...

Entitlement at its best.

That being said, there's nothing wrong with offering a co-pay assistance plan, but the way it was administered was definitely faulty.

Anonymous said...

@clairesmum,

Be careful when discussing Sumdood! He is Legion!

http://ambulancedriverfiles.com/2007/05/30/sumdood-evil-criminal-mastermind/

Crazy RxMan said...

One thing for sure... Sum Dood is all for more hookers and blow.

At Goofmart pharmacy, some drugs (Crestor, for example) will come back at adjudication with a message that the company has paid $XX toward the co-pay for the patient. I don't know if they do this with all insurers or specific ones, but it sure beats the heck out of the pharmacist/tech having to do split billing or the dumb cash up front idea Dr. Grumpy mentioned in this blog post.

Maybe they should have limited the card for specific meds, hookers, and/or blow.

Abigail Cashelle said...

What I want to know is why they were only able to purchase one tank of gas with this card...

 
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