Latest / CareTalk: Healthcare. Unfiltered. / Mark Cuban on Why Patients Don’t Trust Their Medical Bills
Transcript
- 0:06John: I just remember that early discovery phase when you were talking to, I think I talked to you once or twice, you talked to a lot of my friends, and the patience and the care with which you got into the details of how our crazy healthcare system, but you could have gone after anything.
- 0:22John: What intrigued you about going after drugs and drug margins and, you know, what's turned what right now is probably one out of every five healthcare dollars that, that insurers cover is, is now drugs?
- 0:34Mark Cuban: It was the path of least resistance, to be candid.
- 0:36Mark Cuban: Um, you know, nobody knew what the price of a medication was.
- 0:40Mark Cuban: The stories, um, of hearing people at the pharmacy counters turning around and not being able to get their drugs are tragic.
- 0:48Mark Cuban: And so when I looked, it was very self-evident that nobody knew not only the price, but the cost of a medication, and nobody trusted, trusted the economic side of pharmacy or medical.
- 1:01Mark Cuban: And so it just made natural sense to me a- as a, an entrepreneur that if I showed my cost for a medication and I showed my markup and let- had it at 15%, not only would we be less expensive, but we would be trusted, and that's the key that was missing.
- 1:17Mark Cuban: People don't trust the economic side of their healthcare.
- 1:19Mark Cuban: They trust their doctor, but they don't trust the bill that they're gonna get or what it's going to cost.
- 1:25Mark Cuban: And by, you know, having that ultimate transparency of cost and markup, that was unique and that would allow us to not only be less expensive, but to be trusted, and that's what got us there.
- 1:35John: And the vast majority of Americans assume that they're getting a fair price at the pharmacy.
- 1:42John: What are they missing?
- 1:44Mark Cuban: They're missing, you know, they trust their pharmacist and assume that the pharmacist is gonna do the right thing for them.
- 1:49Mark Cuban: What they're missing is there are these enormous conglomerates that dominate the economics of not just pharmacy, but all of healthcare.
- 1:58Mark Cuban: And in pharmacy specific, they're called pharmacy benefit managers, and they effectively control, you know, 85% of the formularies, which what determines, um, what healthcare, um, members, what drugs are available to them and at what price.
- 2:15Mark Cuban: And with that control, they've been able to dominate the, the pharmacy market and really define pricing.
- 2:23John: Well, and I, I think the other thing is that it's all done in the shadows.
- 2:26John: You know, one of the- Yeah … the amazing things that you've been able to do is really talk about true pricing.
- 2:32John: I think the MD Anderson study recently said that you can, you know, that it, it can often cost $50 a copay for a generic prescription that they can, people can get for $5 on the cost- Cost Plus Plus pharmacy.
- 2:46John: I mean, it was just mind-blowing.
- 2:48Mark Cuban: Yeah, it's crazy.
- 2:49Mark Cuban: Yeah, it's crazy.
- 2:49Mark Cuban: I mean, whether it's what Medicare spends on drugs, whether it's insurance companies.
- 2:55Mark Cuban: I was just talking to an insurance company, and they literally don't know what their actual net price is because of all the rebates and fees.
- 3:03Mark Cuban: And where the industry is really turned upside down when it comes to patients starts with distribution