Point shaving - A type of match fixing where the performers try to prevent a team from covering a published point spread. Unlike other forms of match fixing, sports betting invariably motivates point shaving. A point shaving scheme generally involves a sports gambler and one or more players of the sports team favored to win the game. In exchange for a bribe, the player or players agree to ensure that their team will not "cover the spread". The Gamler then wagers against the team.
- Wikipedia (to keep it sinmple)
Point shaving is illegal and it looked at as a form of corruption. It is usually collusion between sports players and bookies to make a great deal of money at the expense of others who are gambling on the game.
This is exactly how pharmacy "discount cards" work!
Think about it for a minute. A person can usually sign up for a pharmacy "discount card" for free or a very small fee. The user then brings the "discount card" to the pharmacy where it is input into the computer as insurance (on the billing end they are treated the same). The "discount card" will usually reduce the price of your medication based on what the pharmacy markup is. Since brand name prescriptions have a lower markup than generics they have a smaller discount. In most cases I have seen it reduces the out of pocket expense of the prescription to the pharmacy cost plus a few dollars as our dispensing fee.
So how is a pharmacy "discount card" like point shaving?
Simple...
The people who make the pharmacy "discount card" charges the pharmacy (in a few cases the patient) a fee for using their discount services. In many cases this fee ranges from $2 - $5, depending largely on which card is used. On average this fee is ~$3 per prescription. This may sound like a nominal fee for such a discount however; many times these cards make more on the medication the pharmacy dispenses than the pharmacy itself!
These "discount card" makers also give distributors (aka the guy who mails the pharmacy the card or is passing them out) a cut of what they make. His profit is usually somewhere around $1 per prescription. Check out this website and tell me this isn't some sort of crazy pyramid scheme! Here is a pic from the website...
That's right, the guy who made this "discount card" makes more money than I do, despite the fact that I have the product that will improve a patient's health, have a doctorate in the field of pharmacy, assume every single aspect of risk and liability in filling your prescription and even offer consultation on how to properly and best use the medication!
Over the long haul these "discount cards” cut into the overall profitability of the pharmacy. This forces pharmacies to have less tech and pharmacist hours which increases the chance of having errors occur due to increased demands on the workers. Also, by cutting into the pharmacies overhead on the prescriptions, it forces the pharmacy to raise its prices on medications to try to recoup the loss of income associated with filling these prescriptions. Eventually this price trickles over to everyone else as well. Granted most insurance companies are protected due to negotiated prices. The person who really gets hammered is the cash paying patient who has no insurance or "discount card". I promote being your own advocate as much as anyone, but this is really a case of punishing the wrong people: The pharmacy workers and the innocent cash paying patient!
So here is the direct comparison:
Player who shaves points = Patient with discount card
Bookie who makes a lot of money = Pharmacy "discount card" supplier and distributor
People who are scammed by betting = Pharmacy staff and other patients.
The main difference here is that the patient with the "discount card" usually does not know how these cards truly work. Therefore, I must say they are not at fault and I am not blaming them. It's just a shame that the person who gives out these discount cards can make so much money! I must say, I have seen some cards that are handed out by a local county that they either don't take that much of a fee or any at all. I have less of an issue with these cards as they appear to be more altruistic.
All of this points at a big issue in the retail pharmacy industry (and healthcare in general), the need for clearer pricing and compensation guidelines. There will be a post to follow on that at some point, however if we had clearer standards the industry would benefit as a whole. Unfortunately, businesses prefer to do whatever it takes to draw patients in so they can sell them items with higher markups than prescriptions such as soda, OTC diet pills and candy bars. This results in many of them taking these discount cards and over working there associates in a cut throat fashion to make and extra dollar while not truly worrying about patient care.
I encourage everyone to do some research and see who is REALLY getting paid when they pick up their prescription...