Nothing makes anything less affordable than a government promise to make something more affordable, and a Texas pharmacist revealed this week how an $18 generic antibiotic gets listed for $2,500. But from there, things get so seriously stupid that you just know there must be a government program involved.
Brad Hart, along with his wife Glenda, own Forest Park Pharmacy in Fort Worth, so he knows a thing or two about how the system works — and just how dysfunctional it is.
“A family came in wanting to transfer their kid’s antibiotic to us,” he posted to X earlier this week. “The child had already STARTED the course. Then, mid-treatment, the insurance company decided the last 14 tablets suddenly needed a ‘prior authorization’ before the other pharmacy could hand them over.”
All this for Linezolid, a generic antibiotic that costs Forest Park $18.
Why all the fuss for something so inexpensive?
Hart explained, “Insurance and the PBMs [Pharmacy Benefit Manager] behind them price drugs off a number called AWP — ‘Average Wholesale Price.’ People in my industry have another name for it: ‘Ain’t What’s Paid.’ It’s a benchmark number, not a real-world cost. On paper, the AWP for just those last 14 tablets is about $2,500.”
“The system that’s supposedly ‘protecting’ this family from cost is the same system that inflated an $18 medication into a $2,500 line item, then slapped a prior auth on it to “review the expense” THEY invented,” Hart continued. “They manufactured the problem, then billed everyone for the privilege of solving it.”
PBMs and AWPs were unfamiliar to me, so I asked Grok to explain how they work and why they exist.
The short version is that Washington’s tax incentives and Affordable Care Act (thanks, Obama!) mandates push everything into third-party insurance, disconnecting patients from real costs. Medicare Part D (thanks, W!) and weak transparency rules empower PBM middlemen (another Washington creation) to profit from fictional AWP benchmarks, delaying care and sucking up tax dollars while also overcharging sick people.
You get robbed coming and going.
Really, what the insurance companies do here is play arbitrage games enabled by government meddling in the name of affordability. That’s why Forest Park Pharmacy doesn’t take insurance and just sells medications at a market-rate markup from their wholesale cost.
One solution — and this is exactly what I used to do — is to buy bare-bones high-deductible health plans with catastrophic coverage and pay cash for everything else. But I can’t do that anymore because Obamacare made those plans mostly illegal or unobtainable.
Why, it’s almost as though the entire system were geared for price-gouging.
Hellbound and Down 