Los Angeles—Using independent community pharmacies instead of going to large chain stores is more cost-effective for uninsured patients, a new study suggests.
The report in the American Journal of Managed Care points out that patients with no health insurance or with limited prescription drug coverage are better off avoiding big- box, grocery, or chain drug stores. Using discount coupons also helps, according to the University of Southern California-led researchers.
The study team found surprising price variation among pharmacies; they note that the cash price for a commonly prescribed generic antibiotic can vary by an average of $52 within a single ZIP code.
To determine that, the investigators surveyed 535 pharmacies in Los Angeles County’s highest- and lowest-income ZIP codes.
“Consumers typically know the price of a product and have some information about its quality before purchasing. That’s rarely the case in healthcare,” said lead author Geoffrey Joyce, PhD, director of health policy at the USC Schaeffer Center for Health Policy and Economics and associate professor at the USC School of Pharmacy.
The Los Angeles pharmacies were contacted between July and August 2014. Researchers said that they were calling on behalf of an uninsured patient and requested the cash price for two commonly prescribed generic antibiotics, levofloxacin and azithromycin, which treat community-acquired pneumonia.
Prices quoted were analyzed by 82 ZIP codes, as well as by type of pharmacy, including chain drug stores, independent pharmacies, grocery stores, and big-box stores. Prices for the two antibiotics also were searched on GoodRx, an online service that aggregates discounts and coupons.
Results indicate that, in low-income areas, the price for levofloxacin ranged from a low of $4 to a maximum price of $149. In high-income areas, meanwhile, the range was $5 to $229. Researchers found similar patterns—albeit lower costs—for azithromycin, with prices ranging from $2 to $26 in low-income ZIP codes, and $4 to $30 in high-income areas.
The type of pharmacy was found to have a significant effect on price variation. Study authors report that the average price for levofloxacin at an independent pharmacy or purchased with a GoodRx coupon cost less than half the price quoted at a big-box store and less than one-fourth of the discounted price at a chain drug store.
Taking all of that into consideration, the average price difference between the highest- and lowest-cost pharmacies in a ZIP code was more than $100 for levofloxacin and $30 for azithromycin.
“The wide variation in prices shows that pharmacies are exploiting the fact that sick patients do not have the time to shop around for their drugs,” proposed co-author Neeraj Sood, PhD, professor at the USC Price School of Public Policy and director of research at the USC Schaeffer Center. “Our study suggests that consumers can do two things to save money: Shop online at websites like GoodRx or go to your local independent pharmacist.”
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