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Tuesday, February 1, 2005
Just a Spoonful

Discovery Health says it has taken action to stop the overcharging of its members at some Dischem outlets. The pharmacy has pledged to refund Discovery members any payments in excess of their normal prices and these amounts will be credited to their savings accounts as appropriate.
Discovery Health reacted strongly to the news that some Dischem pharmacies had been charging its members a mark up of 36% on the single exit price for medicines set by manufacturers – in contrast to other customers who were charged a mark up of only 26% or R26.
According to Discovery Health Managing Director, Barry Swartzberg, the company’s medicine pricing policy during the current period of uncertainty in the industry is based on the following three principles:
• to protect members against co-payments;
• to ensure the continued viability of our pharmacies; and,
• to support the intentions of the medicine pricing regulations.

In terms of this structure, Discovery Health will pay a mark up of up to 36% or R59.40 (whichever is the lower), as long as this pricing policy is applied consistently across all customers. This is to minimise the financial burden on members who may be using pharmacies charging mark-ups of more than 26%. Along with certain other pharmacy groups Dischem has agreed to a mark up at the 26% level, yet Discovery Health members were being charged at 36%.
According to Mr Swartzberg Dischem’s actions ran contrary to the intent of Discovery Health’s interim pricing structure. However, the matter was raised immediately with Dischem, which apologised and assured Discovery that this had happened at only a few branches.
Mr Swartzberg reiterates the point that Discovery Health will continue to do its utmost to protect the interests of members, while being sensitive to the needs of the pharmacies through this period of uncertainty. “However we will not tolerate a situation where, in our pursuit to address the concerns of pharmacies, our members are discriminated against,” he says.
Members are encouraged to shop around.

Copyright © Insurance Times and Investments® Vol:18.1 1st February, 2005
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