How GoodRx can get you better prices than insurance on medicines in the US?

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How GoodRx can get you better prices than insurance on medicines in the US?

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Basically, GoodRX has deals with insurance companies that say they can give that insurance company’s prices to the user. GoodRx takes a cut and the pharmacy still makes money so they accept it. The prices of medicine are exorbitant so you are usually charged way more than the actual value of the medicine, pharmacies and insurance companies are fine lowering it a bit if it means you for sure put money in their pockets. At least that’s my understanding of it

A recurring theme in U.S. healthcare is an arms race in prices. That is, insurance only pays a fraction of the charged price and always negotiates down, so whoever is charging for something keeps hiking the claimed “price” every year, and insurance keeps offering a lower fraction, until the price is massively inflated. This can work OK as long as insurance is involved, because only the smaller negotiated rate applies. However, the charger has to charge that massively inflated rate to anyone without insurance, because they’ve sworn that’s the real price. They also have to charge the negotiated rate to anyone with insurance, which may be pretty inflated as well. This is why you see uninsured people get absurd hospital bills, because the hospital has to swear in writing that the price was $50,000 to have any hope of getting $10,000 from insurance.

In the case of generic drugs, this problem gets especially complicated because a lot of middlemen and rules make it hard to shop around accurately. The price a pharmacy is required to charge for a drug is almost totally unrelated to what a pill costs to manufacture (which is usually very cheap), and varies wildly from insurance to insurance. In many cases, the pharmacy would happily charge a lower rate to get the customer’s business and still make a profit, but legally can’t do so.

GoodRx basically acts like an insurance company by negotiating rates and giving the pharmacy a legal way out of this problem. They don’t actually do anything to reduce the costs of making the drug, shipping it, or running a pharmacy. They just help sidestep a bunch of weird economic and legal problems.