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CU offering prescription drug discount program; researching 'donut hole' loans
Redstone Consulting Group, a CU service organization of Redstone Federal Credit Union, is developing new products to help members fill in the gaps in their healthcare coverage, including a discount prescription program and “donut hole” loans. The products will first be offered to Redstone FCU members and then to other credit unions, explains RCG CEO/President Harry Gunsallus, CCE, a CUES member.
Pharmacy Discount Cards were set to be available in the branch lobbies of $3.5 billion, 367,000-member Redstone FCU starting in February, offered at no cost to members or the credit union. Discounts of 50 to 70 percent on selected medications will be honored at participating pharmacies in a program RCG developed with a vendor that has agreements with pharmaceutical manufacturers to extend the same discounts offered to major insurance carriers.
The discount program is designed for people who don’t have prescription drug coverage, notes Gunsallus, who is also Redstone FCU’s executive vice president. “It’s not intended for the fully insured. If you have insurance, does this card work? Maybe. If you’re taking a lifestyle drug, like the Lunesta sleep aid that may not be covered by your insurance plan, you might get a discount with this card.”
Once the Redstone FCU pilot is complete, RCG plans to offer the program to other credit unions, which can provide private label cards in lobby displays and encourage members to take them for themselves, family, friends, and neighbors. Participating credit unions pay no up-front fees and can earn up to $5 per activation when cardholders present the cards at any of the more than 50,000 participating pharmacies nationwide, including major chains.
Also in development are plans to offer consulting for other credit unions to design and offer lines of credit to cover out-of-pocket medical expenses for members with high-deductible policies.
“We started looking at the Affordable Care Act from an employer/internal perspective, like a lot of employers are, and it may turn out for a lot of people who are currently uninsured that ‘affordable care’ may not be all that affordable,” Gunsallus says, noting that healthcare coverage with the lowest premiums may have the highest out-of-pocket deductibles.
RCG plans to offer consulting with other financial institutions to devise loan terms and conditions, perhaps with a debit/credit card component, to cover borrowers’ major healthcare costs until their insurance kicks in. “In our think tank, we’ve been studying how to take an existing product, basically a line of credit, and market it for this specific purpose,” he notes.
“People care about three things: their families and friends, their money, and their health—not necessarily in that order for everyone,” Gunsallus adds. “Our members already trust us with their money, and we have their families and friends because they refer them to us. This may be a path to bridge health care and banking.”
Karen Bankston is a long-time contributor to Credit Union Management and writes about credit unions, membership growth, marketing, operations and technology. She is the proprietor of Precision Prose, Stoughton, Wis.
