Discount Drug Cards Promise Huge Savings on Your Prescriptions. But Is There a Catch?

You’ve seen them advertised, boasting as much as 80% off prescription drugs. Discount prescription cards can seem like a magic pill themselves— simply wave a free plastic card (or your phone) in front of the cashier at the pharmacy and get deep discounts.

But what are these prescription discount cards? And how do they work? First things first: they are completely separate from your health insurance. Think of them as convenient online coupons for prescription medications. Unlike insurance benefits, these discount cards are generally free and have no additional fees. You need only enter a few personal details and you can begin using the service immediately. Just input your medicine and zip code and watch as results come in from nearby participating pharmacies and supermarkets—Walmart, RiteAid, Walgreens, Safeway and more.

What’s the catch? There's no real downside to the savvy consumer (more on how to be one below). Discount card services make money by charging the participating pharmacies and supermarkets in their network a small fee for each transaction. In bulk, these fees add up. Stores see this as an opportunity to upsell—London broil with your Lipitor? Keep in mind that insurance and discount cards cannot be used at the same time for the same purchase. You can use one or the other, deciding which is better on a case-by-case basis. Here's how:

Should I Use Insurance or a Discount Card?

Just because you find good deals through a discount card doesn't mean you should ditch your insurance prescription benefit. If you're on Medicare and have opted for a Part D drug plan, don't give it up. Many prescription drugs -- especially those that don’t yet have a generic equivalent -- can be cheaper through insurance benefits. Discount cards are especially useful in cases where you have a high deductible plan or a medication you need is not covered on your plan’s formulary, as the list of approved drugs is known. You can research prices ahead of time by calling your insurer and comparing their quote to what you see on the drug discount web site or app. Or, if you have a pharmacist you trust, you can simply present both your insurance card and your drug discount card and see which one offers the better price. Keep in mind that if you buy drugs through a prescription drug card, your spending won't count toward your insurance plan's drug deductible.

Choosing a Discount Prescription Card

Are there differences between the various prescription discount cards? Yes and no, according to Rich Sagall, retired family physician and cofounder of NeedyMeds, a national nonprofit that helps people find affordable medications and health care. No, in that they all make money in a similar way. Yes, in that no one card offers the best price for every drug, Sagall says.

In a search across a half dozen discount services for the common cholesterol medication, Lipitor, for example, many of them immediately pointed to the generic (Atorvastatin calcium) and returned prices as low as $6.50 for 30 tablets of 40 milligrams. The difference in price among the various discount card networks was minimal. (By comparison, branded Lipitor was $450 for the same dosage.) Enalapril, a generic equivalent for high blood pressure medication Vasotace, however, revealed a difference of more than $10 per monthly prescription between two different discount cards—a savings of more than $120 annually.

There’s no one good clearing house for these cards yet, but a Google search will turn up a half dozen similar programs on the first page. You’ll find GoodRX, ScriptRelief, US Pharmacy Card, Discount Drug Network, NeedyMeds, ScriptRelief and RxSaver.

Think twice about getting a discount card that charges a fee, Sagall says. “The bottom line is never pay for a drug discount card nor provide insurance info, your Social Security number, or Medicare/Medicaid numbers. This info is never needed.”