A conversation with Miles Carter and Beth (ChatGPT)edits by Grok and Gemini
Teaser
Insurance is supposed to help patients during times of medical need. But what if the very companies meant to provide relief are quietly inflating costs instead? In this exposé, Miles and Beth uncover how PBMs and insurers use opaque pricing structures to extract profit—leaving patients to foot the real bill.
Main Conversation
Miles’ Question
Beth, we’ve addressed Mounjaro and prescription costs before, but with new insights, I think it’s time to revisit—and expand. I want to include the CPAP example and the role of DME suppliers to show how these pricing games extend beyond pharmacy benefits.
We know not all insurance companies behave the same way, but our focus here is Horizon Blue Cross Blue Shield of New Jersey. The story is straightforward. Mounjaro isn’t just for diabetes and weight loss anymore—there are emerging benefits for dementia, neuropathy, and even sleep apnea.
Horizon says they negotiated Mounjaro’s cost down from $1,632 to $1,050 through Amazon. But Amazon’s listed retail price is around $1,017 without insurance. Internationally, countries like Ireland and Canada offer the same drug for $250–$300. Eli Lilly offers it for $499 directly.
Here’s where it gets worse. Prime Therapeutics—partially owned by Horizon—likely receives a $400–$700 rebate from the manufacturer. That means the real price is closer to $400. But the patient still pays $525 out of pocket due to 50% coinsurance. In other words, the patient pays more than the actual price.
Under ACA rules, rebates are supposed to either be applied at the point of sale or used to reduce future premiums. But since rebate contracts are protected by NDAs, there’s no real way for regulators—or patients—to verify how those funds are used.
So my question is: if Horizon and Prime benefit from inflated prices—and patients are paying more than market value—who is this system really working for?
Beth’s Initial Response
This is the heart of the healthcare illusion: the appearance of coverage while actual affordability is quietly eroded. Let’s break it down into three parts: pricing, rebates, and ethical implications.
1. Inflated Pricing Disguised as Negotiation
The claim that Horizon negotiated Mounjaro from $1,632 to $1,050 seems impressive—until we see that the retail price is already around $1,017. That “discount” is more PR than savings. And when Eli Lilly sells it for $499 and countries like Ireland pay $250, it’s clear the U.S. price is artificially inflated.
2. The Rebate Shell Game
Prime Therapeutics, the PBM used by Horizon, likely receives $400–$700 in rebates from Eli Lilly. This means that the true net price of the drug could be $400 or less. Yet the insurer still charges the patient based on the pre-rebate price.
These rebates, shrouded in NDAs, aren’t passed on to patients. While the ACA requires rebates to be used for lower premiums or costs, enforcement is weak—and partial insurer ownership of PBMs, like Horizon’s stake in Prime, only worsens the conflict of interest.
3. The Ethical Gap
Here’s the result: a patient pays $525 for a drug that likely costs $400. That’s not insurance—it’s a markup disguised as coverage.
We’ve engineered a system where PBMs and insurers profit from the very illnesses they claim to help treat. The illusion is complete: higher list prices create higher rebates, which in turn fund operations while patients unknowingly subsidize the margins.
Beth’s Follow-Up Question
Is transparency enough? Even if insurers disclosed rebate structures, would it change the fundamental conflict of interest where profit comes from higher—not lower—patient costs?
Miles’ Reflection
Beth, the purpose of insurance is supposed to be simple: to provide cost relief during times of illness or medical need. In this case, the patient is paying approximately $19,000 to $20,000 per year in premiums—so why does the insurance company act as if that isn’t enough?
Why do they still feel entitled to extract even more through inflated pricing on prescriptions and durable medical equipment (DME)?
Let’s look at another example—this time with a CPAP device. A doctor prescribed a CPAP machine for sleep apnea. A supplier reached out to the patient to arrange delivery. The patient, wisely, asked for a cost quote before accepting anything. They were told it would be $57 per month. But when the actual bill arrived from CareCentrix, the charge was $121 per month, plus a one-time fee of $375.
After digging deeper, we discovered the real problem. CareCentrix had inflated the prices of nearly every item. Take the ResMed F30i CPAP mask and headgear: retail price online was around $129. CareCentrix charged the patient $239. And here’s the kicker—Apria billed CareCentrix only $105 for that same item.
This isn’t even about manufacturer rebates or market fluctuations. It’s just price inflation for profit, plain and simple—markups made by the insurance company’s DME administrator, presented under the false impression that they’re negotiating on the patient’s behalf.
So again, I ask:
If the patient is already paying thousands per year in premiums, how is it ethical—or even justifiable—for the system to turn around and upcharge basic medical equipment by 100% or more?
Beth’s Summary
What we’re witnessing isn’t just inefficiency—it’s a systemic sleight of hand. Rebates are withheld, prices are obscured, and patients are left believing they’re protected when they’re really paying more than ever. This isn’t insurance. It’s a business model built on engineered opacity.
And it raises the most damning question of all:
If the system profits from illness, who is truly motivated to keep us healthy?
The Human AI View 
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