By Kelly McCutchen
It seems that just about everyone has caught on that ordering prescriptions by mail can help health-care consumers save hundreds and even thousands of dollars. But Georgians can’t count their savings just yet: Georgia law prohibits Georgia pharmacies from mailing prescriptions to individuals. The purpose of the law is to protect the walk-in retail trade of corner drug stores. That well-intended protectionism carries a hefty price: Georgians are unable to reap the cost-savings and convenience that consumers across the nation are enjoying. The General Assembly should consider putting the benefits of millions of consumers over the parochial interests of a few pharmacists.
Ordering pharmaceuticals by mail is so popular and cost-effective that most large employers give employees big incentives to do so, usually by passing the savings along in the form of lower co-payments on mail-order drugs. The federal government offers similar incentives to employees, and the U.S. Department of Defense has set up an entire bureaucracy around mail-order prescriptions, which save active service members and their families millions of dollars. Congress has also recognized the cost savings inherent in the purchase of mail-order drugs. Last year, Congress made it possible for Americans to legally purchase drugs from abroad by mail order.
When drugs are involved, safety is a critical consideration. It’s important that patients have relationships with pharmacists they know and trust. But many patients do not require interactions or instructions from their pharmacists on refills, and refills comprise a majority of all prescriptions filled. Nor is it necessary for consumers of maintenance medications – for example, an asthma patient – to have frequent interaction with a pharmacist. That’s why mail-order pharmacies are used only for refills on maintenance drugs. Antibiotics and narcotics cannot be sent through the mail.
As the cost of prescribed drugs has increased, consumer advocacy groups have also gotten in on the trend of buying drugs by mail – especially maintenance drugs used to treat hypertension and other chronic conditions. According to the Consumer Credit Counseling Service, “For drugs that your family requires regularly, such as asthma medication, mail order can be both convenient and less costly.”
The savings are considerable. Most health insurance plans allow consumers to purchase a three-month supply with only two co-payments. Federal employees must pay 20 percent of the cost of prescriptions filled at retail pharmacies; for mail-order prescriptions, they pay nothing. The same is true for active-duty service members and their families. They pay 15 to 25 percent of the cost of drugs at military or retail pharmacies, but drugs ordered by mail require no co-payment.
Mail-order drugs also provide a tremendous convenience for consumers, especially the elderly. Many of the drugs regularly used by elderly Americans are maintenance drugs and could be ordered through the mail. Mail orders keep the elderly and the homebound from having to venture out to a pharmacy to fill their prescriptions. It’s also a boon to rural consumers who live in areas where a trek to a pharmacy involves more than driving to the corner store.
While the nation is reaping the benefits and the cost savings of mail order pharmacy, a single state has been left behind–Georgia. Our law prohibits Georgia pharmacies from mailing drugs to Georgia citizens. The prohibition does not apply to non-Georgians or out-of-state pharmacies. Georgia pharmacies are free to mail prescriptions out of state and, though unregulated, out-of-state pharmacies can still mail prescriptions to Georgia residents.
The law is intended to help pharmacies – at Georgians’ expense – but it really doesn’t help pharmacies at all. It prevents them from offering the same convenience and savings of mail order to their customers that out-of-state pharmacies can legally provide. If allowed to compete, local pharmacies would have a competitive advantage over out-of-state competitors due to the relationships and trust they have built with their customers and the fact that they could reduce the amount of time consumers must wait for medications to arrive.
The law also attempts to protect the in-store retail sales of toiletries and other goods in drug stores. However, this very law prevents Georgia pharmacies from marketing online – to far more potential customers – the same retail goods the law attempts to protect.
Attempts to artificially “protect” certain businesses almost always do more harm than good, and are almost never justifiable. In this case, Georgia would have to justify forcing its citizens to pay millions more for pharmaceuticals just to ensure the retail sales of a few toiletries. The lost savings, combined with the loss of convenience, especially for the elderly and the homebound, makes it a bad deal for Georgia customers. Georgia ’s policy should be to champion economic freedom and resist protectionism. At a time when health care costs are rising, providing consumers with a safe and convenient option to reduce costs is good policy and good common sense.
Kelly McCutchen is executive vice president of the Georgia Public Policy Foundation, an independent think tank that proposes practical, market-oriented approaches to public policy to improve the lives of Georgians. A version of this commentary first appeared in Bill Shipp’s Georgia. Nothing written here is to be construed as necessarily reflecting the views of the Georgia Public Policy Foundation or as an attempt to aid or hinder the passage of any bill before the U.S. Congress or the Georgia Legislature.
© Georgia Public Policy Foundation (April 2, 2003). Permission to reprint in whole or in part is hereby granted, provided the author and his affiliations are cited.
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