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Wednesday, May 11, 2011 03:07 pm

The new Illinois Rx Card - Too good to be true? Apparently not!

This is the first post in our new IT Overflow blog, where we'll post all sorts of news, including stuff that doesn't fit in our normal paper or stuff that maybe doesn't warrant a full article. We'll try to update it often, and the style will be less formal than our normal news stories. Expect some sarcasm, quirkiness and editorializing, as well as the occasional breaking news story. The name may change if we come up with something more catchy. Here goes! ======================================================================================

Updates below!

When something seems too good to be true, I'm naturally skeptical. So when I got a press release for the new Illinois Rx card - a completely free card offering discounts on prescription drugs at 56,000 pharmacies nationwide, all I could think was "What's the catch?"

The card is the brainchild of Ryan Jumonville, the 30-something, Louisiana-born president and CEO of United Networks America (UNA). Jumonville appeared at a press conference in the Illinois Capitol on Wednesday to promote the card, answering my plethora of probing questions that sought to discover whatever secret I assumed must be hidden in this deal.

Apparently, there is no catch or secret. The card is completely free to anyone in Illinois, regardless of age, medical condition, income, insurance status, or pizza topping preference. I asked about pretty much every aspect I could think of, and (almost) all of the answers from Jumonville and his team were satisfactory. UNA doesn't collect any information about card users, Jumonville says, and the cards work for all generic and name-brand prescription medications, including the expensive ones for diseases like cancer and AIDS. There is no obligation or contract if you use the card, and it's not funded by any government money.

It works through agreements with the pharmacies, who voluntarily offer discounts on prescription medicines to anyone presenting the Illinois Rx Card. Why would pharmacies agree to slash their prices? Jumonville says participating in the program is not so much about stealing customers from other pharmacies, but rather about generating entirely new customers - getting people who normally can't afford prescription medications to actually come buy them. He says the model has been proven in neighboring states like Indiana and Missouri.

The only question I have left is how UNA makes money from this deal. It's obviously a business venture for them, as evidenced by this 2005 story in Business Report magazine about Jumonville's plan rolling out in other states. (Warning: PDF file) The article says in the case of Arizona's program, UNA makes its money from a $1.80 fee paid each time the card is used. Because the card is free to the end user, I assume it must be the pharmacies paying the fee, though I'm not sure if the same arrangement exists in Illinois' version. UNA features the article on its "About Us" page here. When I asked Jumonville about how the company profits, he essentially said it's not important. As much as I hate to admit it, he may be right. I've wracked my brain trying to figure out a way that UNA's mechanism for profiting from this venture affects the end user, but I simply haven't been able to come up with a single thing.

So there you have it. I've tried my best to be a buzzkill, a role reporters often must fill, but the Illinois Rx Card seems to be legitimate. Get more info and decide for yourself at http://illinoisrxcard.com.

One more thing I forgot to mention: The Illinois Rx Card team worked with the Greater Springfield Chamber of Commerce to get the project rolling, which should lend it some additional credibility.

Another one more thing: Just to be crystal clear, this is not an endorsement of the Illinois Rx Card or any person, company or program associated with it. No one paid me to write this, and everything in this post is true to the best of my knowledge.

UPDATE: NPR talks about drug coupons hiding the true costs from consumers - http://www.npr.org/templates/story/story.php?storyId=113969968

I'm not sure if that applies to the Illinois Rx Card, because this card isn't geared toward any particular medicine, and it works for both generic and name-brand meds. Still, it's an interesting read.

UPDATE 2: I got a call yesterday (May 17) from someone who knows a bit more about how these things work. He explained that it's kind of like a referral system: each card has a number on it that corresponds to the card company that issued the card, and each time a card is used, the card company gets a payment, which I guess you could call a commission. The pharmaceutical companies and pharmacies benefit because more people are buying prescriptions, while the consumer benefits from supposedly lower prices. (Though a commenter on our Facebook page said she checked the price on her existing prescription, and it was even more expensive the card than what she currently pays.)

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