Sensodyne & Tums Maker Slammed Over New Coupon Language

Is the federal government preventing millions of consumers from getting a discount on toothpaste and antacids? Or is a major manufacturer discriminating against an entire segment of the population, just to cover its own hide? Those have been the questions swirling around, since the maker of Sensodyne, Tums and other consumer health care products quietly introduced new fine print on its coupons. Customers are crying foul, but the company is sticking to its guns – even though at least one legal expert says the coupon wording, and the company’s explanation, is bunk.

It was about a month ago that the following wording began appearing in the fine print of several coupons issued by GlaxoSmithKline (click on the image above for a closer look):

“You are NOT eligible to use this coupon if you are a government beneficiary. You are a government beneficiary if you are enrolled in any federal healthcare program, including Medicaid, Medicare (Part D or otherwise), or any similar federal or state programs, including any state pharmaceutical assistance program. Further, you CANNOT use this coupon if you are Medicare eligible. For coupon eligibility purposes, all those 65 or older will be considered Medicare eligible.”

It took a while for the internet to notice. But when it did, the internet wasn’t happy. Images of the Sensodyne coupon went viral last week, as couponers demanded an explanation. So GSK provided one – and raised even more questions than answers:

“The coupon language was revised in response to changes to applicable federal law but the exclusions on coupon use are the same. People who are Medicare or Medicaid beneficiaries can obtain certain over-the-counter drugs at a reduced price. Since these government program beneficiaries already get a significant price discount, federal law has always precluded them from getting an additional discount through a retail coupon program.”

So federal law prevents all senior citizens, members of the military, veterans and the disabled from using a coupon to get a buck off their toothpaste?

“On its face, their explanation doesn’t make any sense,” health care legal expert Clinton Mikel told Coupons in the News. “What they added is not the law.”

Mikel is an attorney with The Health Law Partners, a nationally recognized law firm focusing on health care legal issues. “There’s no tie to the federal health care program,” he said. “The federal government is not paying for Sensodyne.” Nor is it paying for Tums, or nonprescription Flonase, or other GSK products whose coupons also now feature the same wording as the Sensodyne coupons.

Any Medicare or Medicaid recipient could tell you that – and many have tried telling GSK. Some private health care plans do include an over-the-counter benefit for Medicare recipients, for products like cough and cold medicine, vitamins and even toothpaste. But the government makes it clear that funding for such a benefit must come from the health plan itself – because by law, federal benefit dollars are not to be used to pay for nonprescription products.

Any confusion likely stems from two federal laws designed to prevent fraud and abuse in federal health care programs – the Anti-Kickback Statute and the Civil Monetary Penalties Law.

The first law forbids, among other things, the offer of anything of value in exchange for the purchase of an item reimbursable by a federal health care program. Coupons for prescription medicines fall under that category. A coupon might induce a Medicare recipient to buy – or a pharmacy to provide – a higher-cost brand-name drug, and simply bill it to Medicare. Then the federal program is on the hook for the higher-cost item instead of a lower-cost alternative, just because the brand offered a coupon. So by law, you can use a coupon to pay for a prescription drug, or a federal health care benefit – but not both. The second law allows the government to assess substantial fines against anyone who violates this regulation.

And it’s not just consumers who can be held liable – companies can also be fined for not doing enough to ensure their coupons aren’t used to pay for federally-funded medicines. That’s why GSK, like other drug manufacturers, puts fine print on their prescription drug coupons stating that federal health care beneficiaries cannot use them.

In fact, the wording on GSK’s coupons for its prescription medicines is exactly the same as the wording that it is now adding to its nonprescription product coupons.

But why, when federal health care programs aren’t paying for Sensodyne and Tums at all? GSK has refused to elaborate on its prepared statement, in response to questions from Coupons in the News. But a slight variant of the statement posted on its Facebook page may offer a clue. “This is actually due to a determination by the U.S. government that pharmaceutical manufacturers (including GSK) may not offer coupons to individuals enrolled in government funded programs,” the statement reads.

That should more accurately read “pharmaceutical manufacturers (including GSK) may not offer prescription drug coupons to individuals enrolled in government funded programs.” But GSK apparently has decided to take a blanket approach, and forbid the use of any of its coupons by any federal health care beneficiary – or even people who are old enough to be federal health care beneficiaries, regardless of whether they actually are.

Mikel believes that’s unwarranted – and unwise. “This reeks to me of them thinking they could add this wording as a zero-risk way to risk mitigate,” he said. With recent changes in health care laws, and the government getting more aggressive about enforcing them, some may believe it’s better to be safe than sorry. “I can see someone having an abundance of fear in the current environment,” Mikel said. Hence GSK’s new overly-cautious coupon wording, which Mikel believes “they simply added knowing it would not be adhered to.”

If true, that would be an awfully cynical approach to creating coupon terms and conditions. The fine print on coupons is getting longer and more complicated as it is, with well-intentioned but entirely unenforceable stipulations such as “limit of four like coupons per household per day”, or “void if traded”. Just as no cashier will ask you how many like coupons you’ve used at other stores that day, or whether you traded for the coupon you’re using, no one is going to ask for your ID if you try to buy Tums with a coupon, to prove that you’re under 65 years old.

Plus, GSK’s effort to insulate itself from risk, carries some risks of its own. “Some enterprising claims attorney could slap them with an age discrimination lawsuit, because it really has nothing to do with federal law,” Mikel said. “If I may make a bold prediction, I would predict they will remove this wording soon.”

In the meantime, they have a growing group of angry consumers to contend with. “GlaxoSmithKline has lost my business and your product is being squeezed into the trash right now,” one commenter wrote on the company’s Facebook page. “You are committing social suicide!” another wrote. “Congratulations on losing probably millions of dollars in business,” added a third.

Sounds like someone at GSK is going to need some Tums themselves. Just as long as they’re not over 65 – or they’ll be stuck paying full price.