Let’s get to an example right away. As I write this, antidepressants are the most prescribed drugs in America. (That’s a book in itself!) The most famous of all is Prozac. I bet you’ve never heard of Fluoxetine. It should be famous, too—for being cheap. Fluoxetine is the generic for Prozac. Look what happens if you buy this generic medication instead of the name brand:

Going Generic

Name-brand Prozac	$8,290/year
Generic Fluoxetine	1,940/year
BIG SAVINGS =	$6,350/year

Whoa! You can save $6,350 a year if you buy generic. I feel the depression lifting already. That’s a phenomenal savings—77 percent—for somebody without insurance. And if you are insured, you can see why your insurance company would want to nudge (shove?) you toward the generic drug to save itself money.

It makes you wonder why doctors write prescriptions for brand names at all when they could save their patients a lot of money by specifying a generic. The answer is that there are nearly 6,000 medications on the market, making it impossible for doctors to keep track of them all and when patents expire and generics become available. Plus, name-brand drug company reps make the rounds daily, dropping off free samples to keep their drug’s names in the doctor’s memory. Generic drug makers don’t do that.

Are Generics As Good? There’s a misperception that generic drugs aren’t as good as name-brand drugs. That’s baloney. Here are the facts. The Food and Drug Administration (FDA) requires generic medicines to contain the exact same active ingredient in the same amount as the name-brand med.

The only difference is in the inactive ingredients used to bind the generic pill together. These inactive ingredients can affect how the body absorbs the active ingredient, which could make a generic medication slightly more or less effective than a brand medication for a particular individual. It’s also possible for individuals to have negative reactions to the inactive filler ingredients themselves, like perhaps a dye. (To be fair, your body could also react better to the filler ingredients in a generic than in the original name-brand drug.)

The one time that generics may not be an option is with drugs that have what’s called a narrow therapeutic index. That gobbledygook term means too little of the medication is not effective and too much is toxic. The effective dose must be very precise and differences in the inactive ingredients of a generic could bother sensitive patients. A handful of antiseizure medications, asthma drugs, blood thinners, heart medications, psychiatric drugs and thyroid meds have narrow therapeutic indexes. Ask your doctor and pharmacist for guidance.

Amy D. of Ohio wishes she had known. She discovered she had epilepsy in her early twenties, later than most, which made it particularly terrifying. Amy and her doctor worked hard to find just the right medication to control her seizures. And then a pharmacy, following the requirements of her insurance company, switched her to the generic version of the drug without alerting her. Amy suffered a seizure while riding her bike and broke her leg and fractured her eye socket. Today her doctor, her insurance company, and her pharmacist all know that, for her, taking a particular medicine—in this case, a name brand—is necessary.

Beware of Prescription Drugs that End in ER, CD and, XR

These and other initials stand for extended release and continuous delivery. They are often trumped-up variations of medications that were big moneymakers for the manufacturer but lost their patent. Manufacturers sometimes invent slightly new versions of their biggest blockbusters and patent them in an attempt to keep the dollars flowing. That’s their right. And it’s your right to ask if older, cheaper, generic drugs will work just as well for you.

For the vast majority of people, generics are a life-saving, cost-saving option. Since doctors won’t necessarily tell you about them, you need to ask. One option is to request to start out on a generic drug and see if it works for you. If it’s not effective, then you can try the name brand—or another generic! If you want the generic option, make sure your doctor does not write or check the box that says “Dispense As Written” or “Do Not Substitute” on your prescription form. These words are usually meant to instruct the pharmacist to use a name brand only.

You should be aware of one complexity when you go generic. You might not always get the same generic! For example, there are about a dozen different manufacturers who make generic versions of the sleep aid Ambien. To cut their own costs, pharmacies may switch from one manufacturer to another, depending which one currently offers the best price. So from month to month your pills could look different. To make sure you are just getting a new generic and not the wrong medicine, you can look up a picture of the medicine at DestinationRX.com.

Old Can Be Gold

As I mentioned before, pharmaceutical companies give up exclusive rights to their own medications when the patent expires. For that reason, drug companies try to make as much money as possible off of their medicines when they are new. That means older medicines can be golden—for you!—whether generic or name brand. For example, when Consumer Reports rated diabetes drugs, it named an older drug called Metformin a best buy because it’s quite effective for most patients, yet it’s a lot less expensive than a newer name-brand drug called Avandia. Take a look at the cost difference in these two prescriptions over the course of a year:

Benefit of Using Older Drugs

Avandia	$1,872/year
Metformin	270/year
BIG SAVINGS =	$1,602/year

That $1,602 is a savings worth striving for! Ask your doctor if there are older medicines you can try before resorting to more expensive new ones.

Over-the-Counter Sometimes older drugs become so tried-and-true that they can even be converted into over-the-counter medicines. This is another way to SAVE BIG. For example, Prilosec for heartburn is now available as an over-the-counter medicine right at the store in a 20 milligram dose. Yet it’s still possible to purchase it in the same strength as a prescription, too. Crazy, I know, especially when you see the cost difference:

Same Drug Over-the-Counter

Prilosec prescription	$1,997/year
Prilosec over-the-counter	234/year
BIG SAVINGS =	$1,763/year

Isn’t that bizarre? I have no idea why the same drug costs two different prices depending where you get it, but you can exploit irrational pharmaceutical price points like that for your own benefit.

Just Say No to Drugs—Brand-New Ones, That Is

If your doctor offers you free samples of a medication for a chronic condition, you might want to pass. Pharmaceutical reps usually distribute freebies of the newest, most expensive medicines in their collection. If there is a less expensive, older drug, you don’t want to get started on a pricey new one that you will have to pay for once the samples run out. However, if your doc can provide free samples for a brief, acute illness like a sinus infection, go for it.

Different Drug, Same Class

If your doctor recommends a newer drug that has not yet gone generic or over-the-counter, before you swallow the huge cost, you may be able to swallow an alternate pill instead. Ask about a different drug in the same class. In other words, another company’s version of a similar drug. It’s called therapeutic substitution. Certainly, there are times when one manufacturer comes up with a medicine that is uniquely effective. But often the various drugs in a class are quite close and the only reason your doctor has chosen one over another is habit.

The real trick is to switch to a different drug in the same class that is old enough to have gone generic. That’s when this strategy can make all the difference.

Why do drug companies charge such varied prices for medications that do basically the same thing? Because they can. It’s a free-market economy and they can—and should—charge as much as they can get. But you can—and should—pay as little as you can! Of course, you will want to check back with your doctor to make sure that a substitution like this is working for you. If he clears it, then prepare to SAVE BIG.

Let’s use another heartburn example—since prescription drug costs can cause just that—to prove my point. Nexium won’t be available as a generic until 2014, so it’s still pretty pricey. But its competitor cousin, our familiar friend Prilosec, is available as a generic, called Omeprazole. So here’s how substituting could save you money:

Different Drug in the Same Class

Nexium	$2,066
Omeprazole	186
BIG SAVINGS =	$1,880

Hallelujah, $1,880 saved! That’s a whopping 91 percent!

Size Matters

With a title like “Size Matters” in a chapter on pharmaceuticals, you may think this is a special section about Viagra, but it’s not. Sorry to disappoint. But I’m going to show you some sexy savings instead.

Pill Splitting I don’t know why, but many medications cost roughly the same regardless of the number of milligrams in each tablet. I don’t get it. The pharmaceutical company is giving you more, sometimes twice as much, of its prized compound, but doesn’t charge you much—if any—extra for it.

Take Lipitor, the popular cholesterol drug. A 30-day supply of 20-milligram pills costs $127. But a 30-day supply of 40-milligram pills also costs $127. Let’s say your prescription is to take one tablet twice a day. Instead of buying twice as many 20- milligram tablets, you can buy the 40- milligram ones and cut them in half. You may have heard of pill splitting before, but has anybody ever shown you how much this simple trick can save you? Look:

Pill Splitting

Two 20-milligram tablets	$3,066/year
One 40-milligram tablet	1,545/year
BIG SAVINGS =	$1,521/year

Now $1,521 is fantastic, but it’s important to check with your doctor and pharmacist before splitting pills. Some medications, like extended release formulas, should not be split. An easy way to tell if a pill is safe to split is if it is scored along the top for this very purpose. It also helps to get a little $10 gadget at the pharmacy that splits pills neatly and evenly.

Still nervous about uneven doses? I have a great resource for you. In his indispensable book, How to Save on Prescription Drugs, Dr. Edward Jardini, a practicing physician, says that he tells his patients to “take the ‘big half’ now and the ‘small half’ next dose” so that things even out. In the book, and on his website, http://HowToSaveOnDrugs.com, Jardini has created a great table he calls the “Expensive Drug Survival Index.” It indicates whether drugs are suitable for splitting as well as other ways to save on different name brands.

Save Not Just by What’s Written But How It’s Written

Ask your doctor to write “Use as directed” instead of detailed dosing instructions if you want to split pills. Some insurance companies don’t allow you to get more than a month’s supply of medicine at a time. If your strategy is to get 30 higher-dose pills and split them so they last two months, that could be a problem. Exactly how you take those pills can be a private matter between you and your doctor. Ask your doctor to explain the pill-splitting protocol during your office visit instead of on the prescription pad.

Pill Growing Don’t worry, I am not going to tell you to plant your pills and water them in hopes that they will sprout little baby pills and save you money. I coined the term pill growing to describe another practice that can help you SAVE BIG on prescriptions—namely, taking one big pill instead of a bunch of little pills. Since many pills cost the same amount, regardless of the actual milligram strength, this concept works in reverse, too.

Often, a doctor will start you on a low dose of a medicine and then ramp up the dosage as your needs become clear. At first, it might make sense to just take more of the tablets you already have, to use them up. But if you keep doing it that way, you are wasting money. Say you are on the antidepressant Celexa. A single 10- milligram pill costs $3.30. A single 40- milligram pill costs $3.60. So if you take four of the 10 milligram pills, you are paying nearly four times as much as if you take one 40- milligram pill! Grow your pills and check out the savings on an annual basis:

Pill Growing

Four 10-milligram pills/day	$4,820
One 40-milligram pill/day	1,314
BIG SAVINGS =	$3,506

Believe it or not, many doctors don’t think of this idea. I can remember swallowing a whole handful of the same pill years ago because a doc didn’t think it through. In five minutes you can research the cost of different strengths of pills at a website like RXaminer.com or DestinationRX.com. The two sites are corporate relatives, but organized differently. Choose the one that makes sense to you.

Pill Counting It’s possible to save yet more money by craftily choosing the count—how many pills you get dispensed at one time. Apparently, pharmacies have their own tipping points—the numbers of pills that are convenient and cost effective for them to dole out. So, for example, the price per pill at one pharmacy may be way lower if you get 90 at a time than if you get 30 at a time. While at another pharmacy, the ideal number could be 120 pills. Thanks to Internet cost comparison websites, it’s easy to check this out. They usually list the price for 30, 60, 90, or 120 days’ worth of pills. Just do the math to figure out the price per pill and ask your doctor to prescribe that amount.

Where to Get Your Medications

Once you’ve straightened out which medications you’re going to take in what strength, the next layer of savings is where you get them. If you are one of those people who drive straight from the doctor’s office to the closest pharmacy to fill your prescription, hold up! That may be fine if it’s a prescription you won’t be taking for long and if you have insurance, but if you take some medicines regularly, it pays to shop around.

Brick-and-Mortar Stores

Consumer Reports did an admirable study in which researchers called around to 163 stores around the country and asked the prices of four popular prescription drugs. They found fascinating—and expensive—differences. A store in Billings, Montana, was charging $257 for a common osteoporosis medicine. The identical drug was just $160 in Omaha, Nebraska, at a store in the same chain! Consumer Reports found a difference of 26 percent between the most expensive chain and the least expensive one in its study.

Clearly, shopping around is worth it, and I have good news! You can shop around without leaving the house. The website DestinationRX.com lists prices at both online pharmacies and brick-and-mortar pharmacies. Just watch for occasional notices saying the prices are not guaranteed. In that case you will want to call the pharmacy to confirm.

The big players in the pharmacy world are able to pass their bulk discounts on to consumers. Here’s a look at some specific chains and how you can take advantage of what they have to offer.

Costco I’ll tell you right now, the least expensive pharmacy in the Consumer Reports study was Costco. And here’s a nifty secret: You don’t have to be a Costco club member to buy prescriptions at the warehouse store! You just march right up, and when the employee at the entrance asks for your membership card, explain that you are going to the pharmacy. You can also purchase prescriptions at www.Costco.com, which seems to have very competitive Web prices.

Walmart When Walmart announced it would sell nearly 300 of the most common generic prescriptions for just $4, it rocked the pharmacy world. I did more than one story for Good Morning America exploring the news. Walmart has now expanded the list to nearly 350 medications. The mega chain was able to do this because of its tremendous buying power. And that gives you some buying power. It’s always worth checking to see if a medication you take is on the magic list.

Walmart’s move even upended people’s expectations about insurance! Suddenly, you could get many prescriptions at Walmart for $4, which is less than the average copay of close to $13. Can you imagine? Skipping your insurance and paying cash for medicine? I now recommend checking exactly that for every prescription you fill regularly. Which is cheaper, the $4 Walmart price or your copay?

Many other stores have now matched Walmart’s bold move. Archrival Target is one of them. Kroger is another. Kmart offers $5 generic prescriptions. Some Kmart locations also match the prices of competitor pharmacies within a certain radius. So if Walmart is not convenient for you, you have other options. Ask or they won’t tell.

Look into Drug Discount Cards

Drug discount cards allow you to purchase approved drugs for 15 to 40 percent off. The Together RX Access card is the broadest, offering close to 300 brand-name meds plus a pile of generics from several different manufacturers. To qualify, you must not be eligible for Medicare. For more information, visit www.TogetherRXAccess.com. Medical manufacturers, who do not participate in this discount card, may have others of their own.

Online Pharmacies

Don’t discount online pharmacies as a place to fill your prescriptions because boy, can they discount for you! I’m a little creeped out by the idea of ordering medications over the Internet, but there is a way to scope out the legitimate online pharmacies. The National Association of Boards of Pharmacy (NABP) developed an accreditation program for them. Look for the VIPPS seal on the site, which stands for “Verified Internet Pharmacy Practice Site.” If you click on the seal, you should be linked to the NABP for verification. This designation assures that the online pharmacy complies with the licensing and inspection requirements of the state where it is located.

If you’re still not comfortable with an online pharmacy you’ve never heard of, consider the cyber arm of a brick-and-mortar retailer you already know. CVS, Eckerd, Walgreens, Rite Aid, and others have websites where prices are often lower than at their own stores.

Once you are comfortable that you have found some legitimate online pharmacies, go one step further and compare prices among them. I used a pharmacy comparison website just now to search for the blood pressure medicine Verapamil HCL. I found broad differences in price. Check it out:

Shopping around for Verapamil HCL Online

Highest-priced online pharmacy	$569/year
Lowest-priced online pharmacy	40/year
Dollar savings	$529/year
BIG SAVINGS =	93%

So if you spend an extra five minutes you can save $500 and 93 percent? That’s worth doing!

Mail-Order Pharmacies

Don’t forget about the mail-order pharmacies that many insurance companies provide for their clients. The insurance company execs aren’t doing it out of the goodness of their hearts. They steer you to mail-order pharmacies to save their companies money. But it can save you money too. For insurance companies, mail-order pharmacies are cheaper because they deal in large volumes, don’t have to pay rent for a bunch of retail stores, and don’t spend much time counseling patients.

For you, mail-order pharmacies are often cheaper for the same reasons and because you can have your doctor write a 90-day prescription and only make one copayment for it. I think this was originally allowed because it takes a while for mail to arrive, so patients needed an ample supply so they wouldn’t run out before the next shipment. Whatever the history, if you take multiple meds, this adds up. Let’s say your usual copay is $25 and you take five different medications because you have a cluster of related conditions like high cholesterol, high blood pressure, and diabetes. Here’s how much even a person with insurance could save per year:

Getting a 90-Day Prescription via Mail Order

Making copayment every 30 days	$1,500
Making copayment every 90 days	500
BIG SAVINGS =	$1,000

Not everybody takes that many meds regularly, so consider the percentage saved: 66 percent. Two-thirds. Very helpful.

Pharmaceutical Assistance Programs

The only thing better than getting your prescriptions for the 66 to 93 percent discounts that I have been showing you is getting them for free. That, too, is possible, thanks to pharmaceutical companies that want to help people out—and maybe burnish their reputations a little in the process. The biggest pharmaceutical companies each give away more than $200 million worth of medicine every year, according to Pharmaceutical Research and Manufacturers of America (PhRMA), a trade group.

Beware of Companies That Charge You for Free Medicine

Whenever somebody tries to do good, bad guys will piggyback on the cause and try to make some money for themselves. I first heard about pharmaceutical assistance programs when I investigated a crooked company that was pretending to have special connections to the big drug companies and was charging people $200 a month to process their free pharmaceutical assistance program applications. Please! There are a few legitimate outfits that help people with this paperwork, but they charge one-time fees of $5 to $25.

People love to complain about drug companies, but here’s an example of how they sometimes help people. Veronica W. of Kentucky was one of the nation’s first female truck drivers. She loved the freedom of the road—and the solid income. But then, one day while she was taking a break at a truck stop, she had a serious stroke. She couldn’t drive anymore and eventually lost her insurance. Thanks to drug company assistance programs, she is able to get about $600 worth of crucial medications for free every month.

Nearly every pharmaceutical company offers such a program. Some come with fairly easy paperwork, others are more complicated. These programs are typically only extended to people with no health insurance or at least no prescription drug coverage. To that point, some companies require extensive proof that you are unable to afford the medications on your own. Other companies allow you to join the program even if you have a decent-size income, as long as you are able to prove that the medications are a hardship for you. Once you have qualified, the pharmaceutical company sends the meds to your doctor or pharmacy for you to pick up.

PhRMA, the trade organization for the pharmaceutical industry, has a great clearinghouse service called the Partnership for Prescription Assistance (PPA). This program will link you with the maker of your drug. Go to http://Pparx.org for access to more than 475 different assistance programs. The site is easy to use and will give you a great starting point.

Pharmaceutical Company Websites Can Be Sources of Freebies and Discounts

The more commercialized prescription drugs have gotten, the more drug companies have borrowed pages from more common products’ playbooks. So figure out who makes the medicines you take routinely and check out their sites. You may see coupons for discounts or even free samples. You then work through your doctor and pharmacy to take advantage of these offers.

Medical Tests Are Prescriptions, Too!

When you go to get an MRI or a blood test, you get a prescription for that, too. So guess what? Some of the same savings principles that I discussed earlier in this chapter apply to medical tests: shopping around and going online. If you are uninsured or are insured but have to make a substantial coinsurance payment, it’s worth it to shop around for medical tests. Members of Medical Billing Advocates of America say the difference in price from one facility to another could be 20 to 60 percent.

Shopping Around for Tests

Ingrid C. of California had tried everything to relieve shooting sciatic pain that started when she was pregnant. Acupuncture. Massage. Medications. But that singular pain that starts in the base of your spine and then shoots down your leg continued. No fun. Ingrid needed an MRI to determine if she had a ruptured disk or if something else was causing her sciatic pain. Her doctor gave her a prescription for the precise type of MRI she needed. Since she’s a shopper by nature, this beautiful, brilliant woman decided to shop around. Why not for an MRI? Here’s what Ingrid encountered:

Shopping Around for an MRI

Top price	$4,000
Bottom price	1,500
BIG SAVINGS =	$2,500

By shopping around for an MRI, Ingrid was able to save $2,500, which is 63 percent. That’s even more than the experts promised!

Get Help Estimating Healthcare Costs

The website www.HealthProponent.com offers a service called “Health Cost Estimator.” The service helps you shop around for medical procedures. Health Advocate, parent of Health Proponent, says common medical procedures like colonoscopies can vary in price by as much as 100 percent. You can call around on your own or get help from a service like this.

Going to an Online Lab

I know it sounds weird, but you can save money on lab tests by using an online lab. No, you don’t have to bleed (or worse) on your computer. You go to a local facility to have blood drawn or give a urine sample and then the vials are sent to the online lab for analysis. These services are available direct to consumers, so you can even opt to get testing done privately and then share it with your doctor when and if you choose to.

The website www.MyMedLab.com claims it can save customers up to 75 percent off of regular lab prices. Another online lab with a high Better Business Bureau rating as of this writing is http://PrivateMDLabs.com. You can check the reputations of other online businesses by going to www.BBB.org.

BIG TIPS

• Take the insurance company formulary to your appointment.

• Research drug prices online, then have your doctor phone in a prescription.

• Go generic to save the most money of all.

• Ask for old drugs instead of new ones, including those that are now over-the-counter.

• Split, grow, and count pills.

• Shop around among brick-and-mortar and online pharmacies.

• Fill a 90-day prescription through your insurance company’s mail order pharmacy for a single copay.

• Tap into free pharmaceutical industry prescription programs at Pparx.org.

• Shop around for medical tests and lab tests, too.