The Hidden Costs of Healthcare with Dr. Eric Bricker
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🎙 Episodes 6 & 6.2 | Endocrine Matters Podcast
The skyrocketing costs of GLP-1 receptor agonists—medications like Ozempic, Wegovy, Mounjaro, and Zepbound—have left patients, doctors, and employers searching for answers. Why do these life-changing drugs cost significantly more in the U.S. than in other countries? And what role do pharmacy benefit managers (PBMs) play in driving up drug prices?
In this episode of Endocrine Matters, Dr. Arti Thangudu sits down with Dr. Eric Bricker, a physician-turned-healthcare finance expert, to break down the economics behind drug pricing, the impact of PBMs, and what patients and providers can do to navigate this complex system. Dr. Bricker is the founder of A Healthcare Z, where he educates people about the hidden mechanics of the U.S. healthcare system.
If you’ve ever struggled to understand why medications cost what they do—or wondered whether your health insurance is truly working in your best interest—this episode is a must-listen.
Listen to the Full Episode
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Key Topics & Timestamps
Skip to specific parts of the episode:
05:51 – Understanding Drug Pricing and Market Dynamics
12:00 – The Complexity of Copay Cards and Patient Costs
18:13 – Stewardship in Healthcare: A Physician’s Responsibility
23:52 – Final Thoughts and Resources for Patients and Physicians
Episode Highlights
Key Takeaways:
From Physician to Finance Expert – How Dr. Bricker transitioned from clinical practice to healthcare finance.
The True Cost of Medications – How PBMs and drug manufacturers drive up prices—and what that means for patients.
Transparency in Healthcare – Why hidden pricing structures hurt both patients and doctors.
Physicians as Stewards – Why doctors should consider the financial impact of their decisions on patients.
The Consequences of Hospital Consolidation – How healthcare mergers reduce competition and raise costs.
Collaboration is Key – How patients, physicians, and policymakers can work together for a more sustainable system.
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Eric: [00:00:00] The pharmaceutical companies, again, they absolutely will charge, you know, thousands of dollars for medications that only cost pennies to make. And the PBM will absolutely ratchet up the additional cost that, um, that the medication will have because they're adding that transaction fee on top of it. And so when you put the two together, there is Capability to go around.
Arti: Welcome to another episode of Endocrine Matters. I'm your host, Dr. Arthur Thru. Today we're diving into one of the hottest and most contentious topics in healthcare, the pricing of GLP one receptor agonists like semaglutide. You might know them as [00:01:00] Wegovy and Ozempic, and also Tirzepatide branded as Mounjaro and Zep bound.
These groundbreaking medications are transforming the landscape of diabetes and obesity care, but their costs are raising serious questions and challenges for patients, providers, and employers alike. Joining me today to unpack this issue is Dr. Eric Bricker. Dr. Bricker is a physician turned healthcare educator and a renowned expert in dissecting the complexities of the U.S. healthcare system. He's the voice behind the incredibly insightful A Health Care videos. Where he takes the opaque world of healthcare finance and breaks it down into digestible, actionable pieces for all of us. I'm thrilled to have him here today and to help us understand the many layers contributing to these sky high drug prices.
One critical player in this conversation is the Pharmacy Benefit Manager, or PBM. PBMs are third party companies that act as middlemen between insurance providers and pharmaceutical manufacturers. They control [00:02:00] prices and availability and dictate what is on our insurance plan's formulary, a. k. a. what medications are covered by an insurance plan.
This can cause patients and employers to spend more on medications. Recently, PBMs have been in the spotlight due to allegations that they inflate drug prices. In September 2024, the Federal Trade Commission, FTC, filed lawsuits against three of the largest PBMs. CVS Health's Caremark, Cigna's Express Scripts, and United Health Group's OptumRx alleging that they created a perverse drug rebate system that artificially increased the price of insulin and marked up the price of specialty generic drugs at their affiliated pharmacies.
The FTC report found that these big three PBMs control about 80 percent of U. S. prescription drug sales. These PBMs are not standalone entities. OptumRx is part of United Health Group, Express Script is part of Cigna, and CVS Caremark is part of Aetna. While the [00:03:00] Pharmaceutical Care Management Association, the trade group representing PBMs, has denied these allegations, the lawsuits highlight just how significant a role PBMs play in determining drug costs.
A January 2025 report from the FTC added even more insight, revealing that the Big 3 PBMs generated over 7. 3 billion in revenue by significantly marking up specialty generic drugs. The FTC analyzed 51 specialty generic drugs from 2017 to 2022 and found that PBM affiliated pharmacies charged prices substantially higher.
the national average drug acquisition cost which estimates the cost for pharmacies to acquire a drug. For example, the multiple sclerosis drug dimethyl fumarate, which costs pharmacies approximately 177 day supply was billed at nearly 4, 000 on average by PBM affiliated pharmacies. Oncology drugs were sometimes marked up [00:04:00] more than 1, 000 percent, while HIV and transplant drugs saw markups between 100 to 1, 000 percent.
These findings highlight how PBM practices significantly increase drug costs for patients and the healthcare system as a whole. We'll cover key questions that I know are on many of your minds. Why are these drugs so expensive in the United States compared to other countries? What role do pharmacy benefit managers, or PBMs, play in driving up costs?
Is it the pharmaceutical companies, the insurers, or someone else entirely who's responsible? And most importantly, what can we do as providers Patients and employees to be good stewards of our employer sponsored health insurance plan. This episode is especially relevant for those of you who are clinicians navigating how to balance cutting edge care with the financial realities your patients face.
And for employers and HR leaders listening in, we'll touch on balancing benefit structures that maximize access to these life changing therapies without breaking the bank. So [00:05:00] buckle up friends and let's get into it.
Today we have Dr. Eric Bricker, one of the most amazing people in healthcare finance. I think today I have learned so much from him and his YouTube videos. They are crisp, short, and to the point and, um, are so, so educational on this very, very important space that more people in general, but definitely physicians and patients and employers need to, to learn about.
Um, so Dr. Bricker is a healthcare finance expert, but first he's a physician and I think he marries the two very, very well. And Dr. Bricker. Before, uh, before I go on and on and rave about you, can you tell us a little bit about yourself and your story and kind of how you got into this space?
Eric: Well, that was a, it was a super [00:06:00] nice introduction.
And thank you for having me on Endocrine Matters and thank you to everybody, uh, for, for listening. Uh, I'm not sure I can live up to that superlative at the beginning, but I'll try. Um, but I'm a, as you, as you said, I'm a, I'm a doctor, I'm an internist. And I originally Um, initially out of college, started out as a hospital, uh, finance consultant, because I don't have any doctors in my family, and this was back in the 90s, and every doctor I talked to said, whatever you do, don't become a doctor, because the billing and the government, the insurance companies, they've ruined the practice of medicine, so I wanted to learn about that, and so, um, then decided I still wanted to be a doctor, so went on to the University of Illinois at Chicago for medical school, and, you know, wanted to somehow combine Uh, what I had learned during my, uh, hospital, uh, finance consulting with the practice of medicine.
So I, I wasn't exactly sure how that was going to happen. But then I went on to Johns Hopkins in Baltimore for a residency in internal medicine because Hopkins does a ton of like policy work. And I'm like, okay, well, maybe I'll be [00:07:00] academic physician and, and work on healthcare policy. But it turned out that my, my, uh, I'm a little too impatient.
for healthcare policy research. I needed to see the fruits of my labor a little faster, so I actually started a healthcare navigation company with one of my consulting colleagues while I was in residency. And, uh, and he was based in Dallas, so I moved from Baltimore down to Dallas as soon as I was done with my residency.
And this was during the Great Financial Crisis. So we tried to raise venture capital and failed miserably. So we're like, well, we're just going to keep our job. So I was working as a hospitalist and, um, and then, you know, nights, weekends, you know, we were, we were working on growing this business with a third partner.
And eventually it got to the point where. Uh, we, we would sell to employers to help their employees and their family members navigate their health insurance and health care, um, sort of think of like a, like a travel agent, except for health care, we would make zero clinical decisions, but when it came to all the paperwork, whether it was the prior authorization or the scheduling, Or if you got a problem, bill, then we [00:08:00] would help, uh, resolve all that for you.
So sort of your, your healthcare ninja, if you will, we call them health pros. And we drew that to about 2000 employer clients, about 1. 8 million people that we supported had McDonald's, Southwest Airlines, T Mobile, a whole bunch of large corporate clients. And then we sold that business in 2018. And then I wasn't beholden to anybody.
So I started making these A Health Care Z videos because I'd seen kind of the doc and the hospital and the insurance side. And I could kind of, you know, shoot people straight in terms of what I had seen. And that's what that's what the A Health Care Z videos are. So anyway, that's much more of an answer than you wanted.
But I'll, I'll, I'll pause there.
Arti: No, that was amazing. And I think one thing to take away from that is That you ran with this curiosity and you went further to to engage with that curiosity and it wasn't just like you're like, Oh, I wonder what this is like, and then you stopped. And I think that's something that is so important for us to [00:09:00] see.
How that can change not only your life, but, but many individuals lives, you said one point, what, 1. 8 million people. Um, so, so that's incredible. The other thing that I think is crazy about that is. I think, I think we're past this now, especially given the state of, of the country and the news cycle, but many people think that insurance is there to help them health insurance.
And then here you were creating a company to help. A people understand or navigate a system that was actually that they think is supposed to be there to help them when they are in their most vulnerable stages in their life when, when they're sick and, and their family's members are sick. Have, have you thought about that in a way, or have you thought about how that's a little.
I don't know, a little crazy or not crazy, not that you're crazy, but it's kind of crazy that this system that's [00:10:00] supposed to be helping needs another entity to come help people navigate that system.
Eric: Oh yeah. And to make it even crazier, one of our competitors was this company called Health Advocate out of Philadelphia.
And the founders of Health Advocate were the executives from a former health insurance company called US Healthcare. So, way back in the 90s, Aetna bought U. S. healthcare, and those executives then left. And they're like, oh yeah, it's so messed up, we know exactly how to help people, so we're gonna start a separate company to help people solve the problems that, in part, we created.
So, we were, we were not the only people to come up with this idea. And, it is, um, and interestingly, uh, All of the, I shouldn't say all, a lot of the health insurance carriers have then subsequently started their own navigation and [00:11:00] advocacy services because most health insurance carriers don't want employers using outside vendors.
They're like, well, just come to us and we'll provide you all their services. So you can actually buy additional navigation services from a health insurance carrier to help. Um, solve to your point, many of the problems that they themselves create.
Arti: It's an incredible business strategy. Really? Let's create a bunch of problems for people and then help them solve it.
Um, so one thing that I really wanted to dive in and just so you know, a lot of our listeners will not know that much about the healthcare system as far as what a PBM is and, and those. So with your answers, just be mindful of that and I might ask you to backtrack and say, wait, define that. But I would love to talk about why the heck are these GLP 1 receptor agonists, Ozempic, Mounjaro, ZepBound, Wigovi, why are they so expensive in the U.
S.? And [00:12:00] as a comparison in other countries, they may not be so.
Eric: Yes. So, um, in America, we obviously have Uh, patent protection so that once you create a new medication, you have a, you have the exclusivity in terms of being able to, to sell it on the market. So essentially you're sort of given a monopoly for that particular drug.
Now in, now. On the opposite. Now I'm gonna, I'm gonna use one fancy economic terms and then I promise I won't use a fancy economic term ever again. But the opposite of a monopoly is a monopsony. Monopsony. And a monopsony is not when there's one supplier, but there's one buyer. And so in places like Europe or any country that has a universal or a state run healthcare system, then they have a monopsony.
There's only one buyer of healthcare. It's the government of. of [00:13:00] the UK or it's the government of France. And so there, if a pharmaceutical company is the sole maker and distributor of a particular drug, well, then the people in the UK or France or whatever other country are going to be like, fine, if you want to sell it in the UK.
We're the only people who are going to buy it. Nobody else is going to buy it. And in America, we don't have that. And not only do we have lots of individual purchasers of healthcare, but up until just recently, it was actually the law in America that the huge purchasing power that Medicare has cannot afford.
set pharmaceutical prices. In other words, the federal government in America cannot act as a monopsony and the Biden administration has started to change that a little bit where there's just a handful of drugs where they have [00:14:00] actually, um, done price fixing on and it hasn't even taken effect. And you know, all these GLP one medications are not on the list of these medications that the, that the government has set the price on.
And so, um, Anyway, I'll try to keep the answer short, but that's why the GLP 1s are so much more expensive in America than they are in other countries.
Arti: So do you think it's the pharmaceutical companies, or do you think it's middle people like PBMs? Um, why do you think that Here in America, there seems to be no, no limit to how much these medications can cost.
Eric: So it's a good question. And so you got to understand, um, the, um, the, the, the motivation and the responsibility of a, a pharmaceutical company. So, uh, the, the. Eli Lilly and Novo Nordisk, the two pharmaceutical companies that make these GLP 1s [00:15:00] are publicly traded companies and they have, you know, what is, you know, quote unquote, a responsibility to their shareholders to make as much money as humanly possible.
So they are profit maximizing machines and all their shareholders are like, and their shareholders are, you know, maybe, you know, Joe and Jane. But it's also large pension funds and insurance companies and those, uh, investors are like, look, this is true for any stock, whether it's stock in Walmart or stock in anything.
It's like, look, your job as a company is to make as much profit as humanly possible. And so when those companies sell, uh, pharmaceuticals in America where they have Patent protection and exclusivity, then frankly, it is their responsibility to their shareholders to charge as much as humanly possible.
Because if they didn't charge as much humanly possible in America, their shareholders would be like, what gives? You know, you said you were going to do, you know, maximize [00:16:00] your profit here. And here you have a country like America that is not a monopsony and does not do price controls. So you better jack up the price.
Otherwise there's no way I'm going to own your stock and I'm going to sell it. And so it's, at the end of the day, that then becomes the issue of, okay, if you're going to have publicly traded, uh, pharmaceutical companies whose sole purpose is to maximize shareholder returns, then all, all you're going to do is expect them to act within the rules and the confines that they have been acting.
So any rational person. within a pharmaceutical company is going to charge as much as humanly possible in America.
Arti: And what's the role of PBMs? And could you start by telling us what a PBM is?
Eric: Yeah, so in order for The, the third party, the insurance company, the employer, or the government, to pay the claim, then there's actually claim payment companies that [00:17:00] process those transactions.
You can think of them like Visa or MasterCard, right? So, it, you know, the, the, the, the government and the insurance companies aren't going to go around, like, literally with, like, trucks full of cash to the pharmaceutical company, right? It's going to be an electronic transaction. And pharmacy transactions.
are the reason why historically health insurance companies haven't, uh, processed pharmaceutical claims is because pharmaceutical claims are, are very, uh, high volume, right? You think about all, I think, I think it's, it's two thirds of Americans are on some sort of a medication, right? So it's just. You know, gobs and gobs of, um, of, of transactions.
And so historically there were separate companies, these PBMs, that were very good at processing these, this very high volume of transactions. They would have essentially all like the Visa terminals, like the credit card terminals, and all the different pharmacies. And they would be able to process all those transactions and then take all the money from the pharmaceutical [00:18:00] companies and then give it to the, the pharmacies who then would take that money and, and, uh, and buy the pharmaceuticals from the drug makers.
It is purely a, um, a transaction, a financial transaction service similar to Visa and Mastercard. Now, those used to be separate businesses from the health insurance companies, but those PBMs would take, uh, uh, just like Visa and Mastercard take a fee, those PBMs would take a fee. And that fee was so lucrative that the, the big insurance companies, so like Optum bought a PBM, or excuse me, United bought a PBM called Catamaran.
And then they changed it to Optum, so now United owns a PBM, and CVS bought a PBM called Caremark, and that's called CVS Caremark. And Cigna bought a PBM called Express Scripts, and so now Express Scripts is part, so all the health insurance companies actually own the PBMs. And Blue Cross was like, hey, we need [00:19:00] to get in on this PBM stuff.
So they actually even started their own PBM that a lot of the Blue Cross plans share that's called Prime Therapeutics. So today, You don't, there are no, there are no large, in those top four PBMs that I just mentioned, they control about 70 80 percent of all PBM transactions, and all of them are owned by large health insurance companies.
So, it's important, so we use this term PBM, like it's this separate thing, but it's really not. It's just part of the health insurance company that processes the transaction, and when they do, they take an additional. Fee for chart for for processing that transaction and you know, typically visa and um, MasterCard have Uh, you know, it's like, I think three to five percent is what they're charging, is sort of that extra fee.
And sometimes the PBM is charging a lot more, as in, uh, you know, 30, 40, 50 percent. For, [00:20:00] depending upon the drug, um, they're charging a lot more for that transaction. Which is why oftentimes the PBMs also get blamed for expensive, uh, drug costs in America. Because for some of those medications, they're only adding an additional, like, penny transaction fee.
But for others, they're adding hundreds or even thousands of dollars.
Arti: So are PBMs supposed to be responsible for figuring out what is on a formulary for a certain insurance plan and for negotiating drug
Eric: Yeah, that's a great question. And the short answer is the PBM actually determines the formulary. So when they, um, when you, to, to continue the analogy, you can think of like Visa or MasterCard as like. Being responsible for negotiating the prices at like [00:21:00] Walmart and Macy's Okay, so instead of you as instead of Walmart and Macy's just setting their prices.
However, they want it's like the credit card companies went out I'm like, okay Walmart. What are you gonna charge and Macy's? What are you gonna charge? And so and also it's like, okay The formulary is, is okay, well there's only certain things that you're going to be able to buy, you're only going to be able to get shoes, and this brand of milk, and this brand of blankets, and this brand of cereal, and so that, that the PBM is actually negotiating not only the prices, but they're also negotiating what you can or cannot buy From Macy's or Walmart and in this case you replace Macy's and Walmart with the pharmaceutical company Merck or AstraZeneca or Eli Lilly or Pfizer and so not only is the PBM charging the transaction but they're using that leverage that they have to be like, okay, if you want to even, you know, let's say Walmart really wants to [00:22:00] sell their milk.
Be like, okay, fine. Walmart. If you want to sell your milk, like, I don't know, there's lots of other places we could get milk. We could get milk from Kroger. We could get milk from Safeway. Why should we have Walmart milk? And we're like, okay. We'll give you a good deal on the milk. We'll sell it to you for X amount.
And they're like, okay, but then we need to add on an extra, you know, the milk you're selling for five bucks and we're going to add an extra three dollars onto that milk in order for you. But like, Walmart's like, well, we don't want our milk to be expensive. We want to sell our milk for two dollars and we want you to only add 50 cents.
And they're like, look, if you want to be on our formulary, you're going to Sell your milk for 5 and we're going to add 3 to it. And there's going to be 8 milk. And so people like, well, no, eight, but 8 is a lot of money for milk, right? And so the pharmaceutical companies blame the PBM and be like, Look, we wanted to sell the milk for 2, but you wouldn't let us sell the milk for 2, because you wanted to jack up the price and take 3 for yourself.[00:23:00]
So there's a whole bunch of finger pointing, okay? Now, the, um, the pharmaceutical companies, again, they absolutely will charge, you know, thousands of dollars for medications that only cost pennies to make. And the PBM will absolutely ratchet up the additional cost that, um, that the medication will have because they're adding that transaction fee on top of it.
And so when you put the two together, there is coopability to go around.
Arti: Do you happen to know, and you may not, but, um, what the cost to make Ozempic or Manjaro is?
Eric: Well, to a certain extent you can use, um, you can use the compounding prices. As a proxy, but it is, um, it is a single digit dollar amounts, if not lower, and the pharmaceutical companies freely admit this.
They're like, look, it's not expensive to make, but what they say is, is that we have [00:24:00] huge sunk costs. in the research and development of the medication. So yes, it might be super inexpensive to manufacture, and so the marginal cost to create an extra vial of Ozempic might be very low. However, we, we are justified in charging these huge amounts in order to recoup.
The research and development that we that we did and so that you know We're not here to answer that question today And I think I think the ant I think the the sort of poster child for this is like a rare orphan disease drugs like for things like cystic fibrosis Where it's hundreds of thousands of dollars a year to treat a person with Cystic Fibrosis.
Or some cancer treatments for brain cancer are literally half a million dollars a year. And of course it doesn't cost half a million dollars [00:25:00] to make that medication. And to what extent is it extortion on the part of the pharmaceutical company? And to what extent is it them, um, quote unquote, you know, quote unquote advancing Uh, medical research through this money that they're making.
And, and the short answer is, that's a highly controversial topic.
Arti: Yeah, and you know, I think like everything, it's nuanced too, because with, with great good can also come evil or, or um, taking advantage of a position of power too. So, it, it probably isn't a black and white answer, which does make it a, a bit challenging.
Um, so, So, based on the data you've seen, have PBMs, and especially when PBMs were bought and taken over by, um, UnitedHealthcare, Aetna, CVS, et cetera, has that led [00:26:00] to an increase in the cost of medications or a decrease in cost of medications?
Eric: Yeah. So, it's a good question. And, um, the short answer is, um, Um, it depends upon who you talk to.
I'm of the opinion that it has overall, you know, it has raised the cost of medications. And here's the reason why. It's because the, um, the, the negotiation and the pricing between the pharmaceutical company and the PBM, it's kept secret. Okay, and so the, the secrecy around that pricing is not done in a way to keep the price down.
It's done in a way to keep the price. And so at the end of the day, any time there is secrecy anywhere, remember JFK in one of his speeches said we have horror secrecy because typically if there's secrecy, it means that The [00:27:00] public or patients or the government or employers or who's paying for this is being taken advantage of, right?
So, like I used to live in Chicago, and on the L in Chicago, there are, like, scammers, okay? And the scammer is not transparent in how they are scamming you. It's a secret! Okay? And so any time there's, so the, you know, the famous quote from Justice Brandeis is that, uh, sunlight is the best disinfectant, which metaphorically speaking means the best way to, to do the most good for people is to make things transparent because in the shadows, uh, is where bad things happen.
So listen, it's America, it's a free country, pharmaceutical company and PBM, you guys negotiate whatever you want, but the, uh, but it needs to be transparent, especially when you have the government, which is accountable to the American [00:28:00] people. paying for this. So ultimately, the people need to hold the account, the government, accountable so that the government can hold the PBM and the pharmaceutical companies accountable.
Now, of course, there's lots of obfuscation that goes along in there, but ultimately that's the right thing to do in my opinion.
Arti: Transparency is, is so important because it enhances competition and it, it lets people know what is actually going on. Stacey Richter, who, um, is the host of the Relentless Health podcast, uses that quote all the time.
And, and I think it's so true in so many industries, especially the, the healthcare industry. Would you, if you know, would you tell us how copay cards work? Because I think part of the lack of transparency Is in with patients because patients are like, Oh, well, this is covered by my insurance or this is, um, I have insurance so that I can get [00:29:00] this medication, but they don't recognize that when the cost of health care goes up.
They're, they pay it in premiums or in a decrease in wages because more of their compensation package is dedicated to health care. And so people don't, since they don't see it directly, they, they struggle. So, um, I would love to kind of hear your comments on that. And, and also, um, to go back to the issue of copay cards, because I don't think a lot of people know how those work.
Eric: Right. It's a great question. And it's, it's understandable that people, uh, don't understand copay cards because they're complicated. So, so hold on to your hats a little bit. Um, now, so, fine. The pharmaceutical company and the PBM, they have negotiated a price. And typically these copay cards are for very expensive medications.
Let's just use a classic one from the last ten years, which is Humira. Which is, which was the number one selling Um, worldwide grossing, uh, medication ever [00:30:00] created. Um, uh, and so the, uh, the ultimate cost to the employer or the government for paying for that Humira, let's just say round numbers, it was about 2, 000 a month.
Okay, so then the, um, the individual employers who are setting up their insurance plans are like, Okay, well we can't cover all 2, 000 of the, of the, of the, uh, the Humira and then make it at zero out of pocket cost. The patient themselves needs to be responsible for some of this. And so for those very expensive medications, typically the out of pocket cost was anywhere from 10 to 20 percent.
So let's just say it was 20 percent. So that means that, and that was 2, 000 a month, that means that the patient would have to pay 400, and then the employer would pay like 1, 600. And then you add the 400 to the 1, 600 and that gets you to the 2, 000. Okay, well 400 a month. For [00:31:00] a patient is a lot of money and so a lot of patients would be like well shoot I'm just like not gonna fill the Humira I'm not going to take it, or I'm going to tell my doctor, typically a gastroenterologist or a rheumatologist, to prescribe something else.
So for like rheumatoid arthritis, there's another medication that's a pill called methotrexate that the American College of Rheumatology actually says is first line treatment for Uh, uh, for rheumatoid arthritis. And so, the makers of Humira are like, well, we don't want that to happen. We want people to buy as much Humira as, we want as many doctors to prescribe as much Humira as possible, and we want as many patients to take Humira as possible.
So, what we'll do is, we'll create this co pay card program so that when the person, the Humira filled, then they will be Forgiven their four hundred dollars so it will be a zero out of pocket cost to them now We as the [00:32:00] uh, we'll only get sixteen hundred dollars, so we won't get the full two thousand But I'd rather get 1, 600 than zero, which is what I would get if the patient didn't fill the prescription at all.
So, how to get these copay cards to the patients? They came up with an ingenious plan. So, there are the, the, when the pharmacist looks up on their computer, you can never see the backside of their screen, right? That's a very mysterious backside of their screen, right? And that's actually operated by another type of company called a switch operator.
And the owners of the largest switch operator in America is McKesson, which is, which is one of the largest healthcare companies in the, you know, it's a, it's a fortune 20 company. It's massive. Okay. So what McKesson did is they went to the pharmaceutical companies and they said, look, We'll let you put your coupons electronically on the screens at the pharmacy so that the patient [00:33:00] doesn't have to go to a website or literally clip it out of a magazine and then bring it into the pharmacy.
The coupon will automatically appear on the pharmacist's screen For them. So I go to my rheumatologist, I got rheumatoid arthritis, they prescribe me the Humira, I go to the pharmacy to fill my Humira prescription, and they say, oh, that's 400 out of pocket, but we've got a copay card for you that takes away that 400 out of pocket, so it will actually cost you nothing to get your Humira.
Would you like to do that? Of course! Of course I'd like to do that. And instead of me then going back to my rheumatologist and I'm like, Shoot, this medication is really expensive. Could you just do the something else? Oh yeah, we could totally just do the methotrexate instead. And methotrexate, methotrexate is 50 a month.
So, because they have lowered the out of pocket cost for the patient, they don't ever have that conversation with their doctor around prescribing a lower cost medication. [00:34:00] The medication still gets filled. And the employer is still paying 1, 600 to, uh, the pharmaceutical company to get that Humira, um, filled.
So that is a very long winded way of saying it is a way for the pharmaceutical companies to essentially front run the plan design that the employer has created. So the employer created this cost sharing in the plan design intentionally so that the patients would have Think about the cost of something before getting it filled and the pharmaceutical companies are like, we've got a strategy that basically like blocks what the employer is doing.
Like you can make whatever plan design you want. We're going to do an end around so that the patient doesn't even experience what that plan design is.
Arti: I love that explanation of that. And essentially what this does is instead of having the patient be a partner with the employer to reduce [00:35:00] overall health spend, it is essentially tricking the patient into.
thinking the medication is free or the medication is free for them. But what they don't understand is on the back end, the cost of healthcare is actually going up. And therefore the amount, the premium that the employer is paying for them is going up and their wages in turn are going down. If your employer is spending more on your healthcare, they have less money to give.
You the employee at the end of the day. So it's very important for us as individuals in this country who may not be a business owner to be thinking about the cost of our health care and the health care of our families on an actual. How much is it costing our employer? As well as us, because in this situation, let's say, I don't know how much methotrexate costs in cash, but let's say it costs 5 a month, which it could, um, 5 a month [00:36:00] and you pay 0 out of pocket for that.
Or maybe you pay 3 out of pocket for that, right? Or maybe you pay 5 out of pocket for that. But Humira, you pay 0 out of pocket, but your employer has paid 1, 600 out of pocket. And ultimately. We foot the bill, whether it's in our premiums or wages given up. or in some other way that's non transparent to us.
So it is important for all people to, to understand healthcare finance and how we as individuals are contributing to that increase in spend and thereby our own decrease in wages. I, I heard a statistic on a, on Stacey's podcast, Stacey Richter's podcast, um, A few days ago that said the percent of compensation that is dedicated to healthcare that, so that's compensation that you don't see, but it's spent on you by your employer has [00:37:00] increased from 17 percent to 37 percent in the past 10 years, that's 20%.
So let's say. You were making 100, 000 a year. That would be 120, 000 a year if the cost of health care wasn't going up so, so rapidly. Um, and sadly, that rapid increase in health care spend is not directly related to quality. Things are getting a lot better. You have more care. You have more access to care.
You have more support. In fact, that's dwindling in many cases. Thank you for that, that really nice answer.
Eric: And let me just briefly say, since we're, since we're talking on an endocrine podcast, it's like at the, at the end of the day, with like GLP 1 medications with Ozempic for diabetes, and they, you know, let's say that they use a copay card for Ozempic, so that's zero out of pocket costs for the member, like, does that mean that we're gonna start using Ozempic as first, first line therapy for diabetes, for type 2 diabetes instead of metformin?
Are we gonna start doing that? Be like, Oh! I No, I The doctor never even brought out metformin! Why [00:38:00] would we ever start metformin? You know, it makes me kinda nauseous. Why would I ever wanna take this metformin business? Well, shoot! Is that really a good idea? Do we really not want people ever taking metformin again?
Because it costs pennies? And has been an effective, uh, medication that's been around for decades that many people would absolutely 100 percent benefit from metformin, but we're just not going to do that because we've got copay cards for ozempic. Is that really the right thing to do? I'll let your endocrinology, uh, listeners decide.
Arti: Yeah. And I think, I think it's a very valid question. And there are some patients with diabetes where, or GLP ones are considered first line, you know, patients with preexisting cardiovascular disease or, or things like that. But I do think. Metformin is still a great drug, and we need to think about it, and especially when we are thinking about the employers in the self funded space, right?
So, um, we We really need to be thinking about the whole pie and how we are how we are [00:39:00] utilizing that pie for for health care And there's also other means to achieving great outcomes and diabetes that are non pharmacological right like lifestyle interventions and sometimes in the fast paced way medicine works now, it's like I'm, uh, you know, the doctor feels like they're just a prescription monkey because they have five minutes and all you can really do in five minutes is write a prescription.
You can't really counsel a patient and goal set and and follow up on those goals and support the patient and give them access to you and all of those things. And so. Um, that in itself, that lack of support that we are able to give our patients in the traditional setting and actually why I left that, that traditional model, I do direct care and direct contracting.
Um, that also will, will lead to more prescribing and absolutely GLP one receptor agonists have a place. And, and I think the problem is that they are also too expensive. [00:40:00] You know, I think that if, if they were. A more reasonable price, then we probably wouldn't be having this conversation about who should have it and who shouldn't or who, um, who deserves it, you know, in the obesity and diabetes world, there's a lot of talk about who deserves these medications, um, which is a whole can of worms that, that we won't go into today.
But, um, But I do think there is a missing piece of patient support, patient education, lifestyle intervention and, um, and a whole, a holistic, whole approach to a person that is missing in the majority of diabetes care that is very, very powerful. We see it in our clinic every day, how, how impactful those interventions can be.
Eric: You know, this, in my opinion, gets down to the issue of stewardship, because there is [00:41:00] not infinite money. And when a physician sees a patient, like, their duty, historically, and in many physicians eyes still to this day, their duty is to only that patient. And they don't care about any other, what's called, it's referred to as an externality.
They don't think about, not that they're uncaring people, but they don't even think about the ramifications of what they're doing for that specific patient. And we live in a world where that is, in my opinion, unacceptable. Like, that, in order to, for you to, like, help your patients, then you need to understand the externality of how that affects Other [00:42:00] patients, how that affects your patient's out of pocket cost.
And, but people are like, well, I don't want to practice, I don't want to practice that way. Okay, listen, every single doctor that practices within Kaiser Permanente has to practice that way. So, are you telling me that every single doctor that practices within Kaiser Permanente is irresponsible? No, not at all.
These are wonderful people that care deeply about their patients and also believe in the concept of stewardship. And so the que, again, we're not gonna answer this today on our, on our podcast, but as physicians, we have to understand that we are stewards. And if we don't take that stewardship responsibly.
then things will continue to get worse. You don't like the way healthcare is today. Part of the reason why healthcare is the way it is today is because physicians are not acting as stewards. And so if you want to be [00:43:00] part of the solution, then we need to start acting like stewards as well.
Arti: I agree, and I also think that let's even make that a little smaller, right?
Like, okay, when you're, when you're prescribing for a patient, most physicians don't even consider the financial toxicity to that one patient, you know, and I think part of it is that there's a veil. Like we're not really, we're not taught that in training. It's difficult to find out how much things cost.
Um, those things it's also, we're kind of taught, Hey, this is standard of care. This is what you should be doing regardless of the costs. Like, I feel like that's how we are, are trained in many physicians. Physicians think about it that way, but when you take a step back, and this is what led me to start my own direct care practice, you realize that, oh my gosh, that abdominal ultrasound that I ordered [00:44:00] for the patient to have at Big Hospital System X cost them 1, 500, and it could have cost 75 at the imaging center down the street, um, and my patient can't afford a 1, 500 ultrasound, um, That, that should bother us and, and we should also be looking for those things because at this point, we've all experienced it in our own lives too.
And I think there's enough newsworthy material that has been out there demonstrating these massive variations and costs based on where the. The procedure or, or study is, is done, we need, we need to open our eyes and, and recognize that we may be doing what the guidelines say for our patients, but that may not be the most important thing to that patient in that very moment, maybe feeding their [00:45:00] children is, is more important.
And maybe we have a solution that we can give them. That enables them to move forward in their health and also accomplish their, their very real Goals and tasks that they need to in their day to day lives.
Eric: Yeah, absolutely and specifically for endocrinologists What what imaging study do endocrinologists order a ton of thyroid ultrasounds?
Right? And so it's like, can you order a thyroid ultrasound at an independent imaging center that would cost, you know, a quarter to one sixth the amount that it would cost at a major hospital system? The answer is absolutely. It might even be read by the same radiology group. Yep. You don't even need to have a different, you know, and you're like, okay, well, I'm gonna have to have multiple ones.
Fine. Even, even more reason. And so I'm not saying don't have the thyroid ultrasound, but I'm saying you've got to be a good steward of that, um, that clinical decision.
Arti: And we do have, we have price aggregators, like these things exist out there. Yeah, it takes an extra step, but for imaging, [00:46:00] we like look up a zip code and find out what the best price for that particular study is in that zip code.
And it gives it to us and you're like, wait, what I can get, I can get anything for 70 bucks in, in healthcare. What is this, you know? And so I think that it's very important for us to start thinking that way. I think that though, now that many physicians are employed, they're encouraged to, um, To keep things within in their health system.
And maybe that's the final thought that we'll, we'll talk about as we wrap up hospital consolidations and what that has meant for the career of physicians and, and the cost of health care.
Eric: Yeah. And so. Overall, you know, across, you know, if you just average it out across the entire country and across all specialties, it's about 70 percent of all physicians are now employed.
And of course, there'll be certain parts of the country [00:47:00] where they're more employed than others, and there'll be certain specialties that tend to be, you know, more employed or less employed. Uh, than others, but specifically as, you know, to your point, as it relates to, um, like endocrinologists, there are fewer and fewer private practices, whether they be private endocrinology groups, or they be sort of your historical, like, multi specialty group that might have, like, internal medicine and then the internal medicine subspecialty.
So they'll have pulmonologists and cardiologists, etc. And there are fewer and fewer of those, and Really the challenge has become is that once a physician becomes employed that essentially at the end of the day they have given away some of their autonomy. That their decision making is no longer their own and they are dictated to by the organization what they will or will not do.
And there's a very good example of a multi specialty physician practice in North Carolina that was called Tryon Medical Partners. It's because it's called, it's on Tryon Street. In Charlotte, and their internal medicine, but they also had endocrinologist, and pulmonologist, and [00:48:00] cardiologist, and they actually, um, separated from the large atrium hospital system in Charlotte because they didn't, because what did atrium do?
They said, you're not having clinic nurses anymore, you're having M. A. 's. And you're having very, uh, and you're having quotas in terms of your patient, the number of patients that you need to see and your visits need to be 15 minutes. And so they're like, look, we want nurses and we want longer visits. And Adrian said, nope.
So they said, fine, we're leaving. And they left. And as a result of that, they've been highly successful. So it's not easy to do, but, but it really takes courage. And I'll just, I'll just leave it at this. And then remember that Aristotle said that courage is the virtue that allows all other virtues to happen.
And so I, frankly, uh, Dr. Ardy, I'm, I'm super encouraged by your courage and you have been hugely courageous. And I take inspiration [00:49:00] from you. And so if you as a physician are looking to do what's best for your patients, just know that there are courageous physicians around America that have, that have done just that.
So you don't have to reinvent the wheel. You don't have to go it alone. There's other courageous folks out there.
Arti: Well, thank you for those kind words. And I, I do think, It takes a, uh, a good amount of courage, but also I think that when we come together, we will be so much stronger. And that's one of the big points of this podcast is bringing physicians and patients together so that we can work together to this crazy healthcare system that we're in and, and perhaps educate physicians and patients of the.
The challenges or atrocities, whatever you want to call it, that have come with, um, keeping that veil on for both non transparency as well as hospital [00:50:00] consolidation and how that can drive up cost and, um. Enable us to really support each other because the health care system doesn't exist without doctors and patients Right, and somehow we have sort of become this very small Or very unimportant cog in a wheel type position where patients are treated like numbers.
And so we're doctors and We're working for insurance companies and hospital systems now, and that has led to, uh, a lot of costs that could potentially be avoided and also a huge lapse in care for many patients. And so I think if we come together, we will truly be stronger and we can, um, we can. Move the needle, shake things up like we are.
So, Dr. Bricker, is there anything else you'd like to add? Any projects you're working on? Um, where can people find you? Leave us with a few final things so people can get in touch.
Eric: Yeah, thank you so much [00:51:00] for, for having me and thank you everybody for listening. And if you just, you can go on to the, uh, A Health Care Z YouTube channel or, um, you can also just connect with me on LinkedIn, Eric Bricker on LinkedIn and I post my videos there as well.
And, uh, thank you so much for having me.
Arti: Absolutely. Thanks so much for being here and we will definitely link his YouTube channel in our show notes so you guys can find it easily. And thank you so much, Dr. Bricker for your time. We so appreciate it.
Eric: Wonderful. Take care, everybody.
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