Mail-order pharmacies have become a new competitor for local pharmacies
By Jennifer Prohov and Whitney Matewe
Feb. 11, 2016
This story was originally created for the Missouri School of Journalism.
Health insurance companies have pushed their patients towards having their prescriptions filled by mail-order. They’re often cheaper, offering customers three months worth of drugs for the price of two.
But pharmacist and owner of Kinkead Pharmacy Mike Kinkead said it has come at a cost.
“The frustration for customers is when we look at them and say ‘Hey, you have to use mail-order, your insurance company will not allow us to fill your prescription anymore,” Kinkead said. “You either have to go to one of these chains or go to mail-order, and we don’t have a choice.”
Kinkead’s father opened up the pharmacy in the 1960s. It’s been a family-run business ever since, but the intricacies of the business have changed. Kinkead said it’s difficult to turn away customers he’s worked with his entire life, but that that’s now the nature of the business.
“It’s very upsetting when you’ve had a customer that you’ve dealt with for years and years and now they cannot do business with you anymore because they’re on a fixed income and they have to do what their insurance says,” he said. “Otherwise, they won’t be able to afford their medication.”
Kinkead explained that insurance companies were prompted by profit when they decided to shift to mail-order pharmacies.
“It’s money, it’s all profit, it’s all dollars,” he said.
Insurance companies have created their own mail-order services, which allow them to keep any amount they make filling a prescription.
Charles Coté, the Vice President of Strategic Communications at the Pharmaceutical Care Management Association, explained that mail-order pharmacies are able to lower costs because they are extremely efficient.
“Mail service pharmacies are able to use a scaling cloud and get over all the lower costs and then that's passed on to consumers,” Coté said. “These are highly technical, 21st century advanced pharmacies, these are robotic. There are numerous checks put in place all along the process to make sure that it's the right drug, the right dosage, going to the right person.”
He said he understands that a customer may have a strong relationship with their local pharmacist, but it often comes down to the difference in dollars.
“While they may have a relationship with a pharmacist down the road, they also really want to save money,” he said. “If someone's looking to save money, they’re going to take a long hard look at that and pick the option that works best for them.”
But Kinkead said he sees it as the best option for insurance companies, not consumers.
“If they can sign a contract with a mail-order company that’s their mail-order company normally, they get the profit off their prescriptions,” he said. “They are saving pennies and dimes on each patient times however many thousand patients they have. It adds up, so it’s all driven by dollars.”