Virtually 100% of young women in my practice who use birth control pills are filling their prescriptions monthly at a local chain pharmacy, paying anywhere from $25-$50 a month (depending on their copay) for contraception.
In a recent post, I proposed that by changing to mail-order, among other things, these young women could save a lot of cash.
Today, I tried to convince such a woman in my practice to do so herself. She was paying a $25 copay every month for her pills, but was reluctant to change to mail order because she liked the convenience of the corner chain pharmacy. (Here in Manhattan, we have a chain pharmacy on practically every corner. Sometimes, the same chain will have 2 stores within a block of each other…)
To convince her, I suggested that if she put her annual pill savings into a retirement account, it might be worth quite a bit by the time she retired. She didn’t believe me.
So we went into my office, pulled up an online savings calculator and calculated it. And here’s what we found –
If this young lady, who is 22, were to use the pill till her late 40’s (say 46), taking 5 years off to have kids (generous by modern standards), and depost the annual savings (for her, $200) into her retirement account with an annual estimated return of 9%, then at retirement at, say, age 66, she will have (are you ready?)
$68,762!
That’s the magic of compounding.
How much could you save by going mail order?
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To calcuate, I assumed she was adding $200 a year into a tax free account till age 30, stopping contributing for 5 years, then contributing again for another 11 years, then leaving that money in the same account till age 66.
The magic of compound interest!
The Suze Orman of gynecological care…you do it all, girlfriend!!!
Love the above comments, but I want to know if she became a convert or just keep going to her local drugstore.
I’m forwarding this to my husband. Loved the Suze Orman comment!
P.S. This was hubby’s response:
“Nice-
I would absolutely advocate mail order on a traditional copay plan. Problem is that it doesn’t work that way on our plan because of the high deductible.”
Is my high deductible plan costing me $68,762? Can’t win… Heh
Great idea. My only question, and it’s not really an issue with something like birth control, especially once you’ve been on it a while, but I’ve had occasion to greatly appreciate explanations and such from the local pharmacist.
WOW you do it all. Yesterday I was in with my ob and having him write rx’s for prenatal vitamins and folic acid cause it can be written off my flex spending account. He had very little idea of what I was talking about! I told him I dumped 5k in dependent care and 5k into health flex spending and it was tax free. He was like huh? He thought it was insurance. Go figure. Told him it was very much worth it, plus lowers my taxable income by 10k. I let it go that he thought it was insurance. Seeing I have a separate insurance plan that was listed right on top of my file.