Don’t Get Burned: What Every Pharmacy Owner Needs to Know About Diabetic Testing Supplies
Let’s talk about something that’s come up in multiple conversations with pharmacy owners lately—and it’s a topic you can’t afford to ignore: diabetic testing supplies. Whether you’re billing Medicare, selling to cash patients, or stocking your shelves for convenience, diabetic testing supplies can be a reliable source of revenue.
But they also come with serious risks if you’re not careful and if you don’t understand the rules.
In this blog, I’m going to break down the two biggest red flags you need to watch for so you can avoid costly mistakes and keep your pharmacy protected.
1. Buy Diabetic Testing Supplies Only from Authorized Distributors
This might sound obvious, but it’s a trap that even seasoned pharmacy owners can fall into. Each diabetic testing supply manufacturer (think LifeScan, Ascensia, Roche, etc.) has an official list of Authorized Distributors (ADs). If you’re not purchasing from one of them, you’re taking a huge risk when billing any of your diabetic testing supplies to third parties.
Here’s why it matters:
- Audit Risk: If you’re ever audited (and let’s be honest—you will be), being unable to prove you bought from an AD could result in clawbacks, penalties, or worse. PBMs will do an inventory audit, and they know exactly what your pharmacy did or didn’t buy from a diabetic testing authorized distributor.
- Product Authenticity & Quality: You have no idea how those strips were handled or stored or even if they’re legitimate. It’s your license on the line. While many non-AD wholesalers sell legitimate products, there is a large gray and black market of diabetic testing supplies.
Many pharmacies lose money when billing insurance for name-brand diabetic testing supplies. The need and desire to find lower-cost alternatives are strong. Instead of risking your pharmacy, I recommend switching your patients to generic machines and testing strips.
Protect Yourself
- Visit the manufacturer’s website to find their current AD list.
- Ensure you only purchase from an AD for supplies that you bill to any third-party insurance.
2. Avoid the “Charity” Diabetic Test Strip Scam
This one’s sneaky and devastating. A so-called “charity” or “nonprofit” contacts your pharmacy and offers to buy large quantities of brand name diabetic test strips. They’ll often say it’s for donation purposes, a community program, or international aid.
Sounds noble, right? It’s not. It’s almost certainly a scam.
Here’s how it works:
- They place a large order for brand name strips (usually the most expensive brands).
- They insist on paying with a credit card.
- That credit card is stolen.
- After you ship the product, the cardholder disputes the charge.
- You lose the money and the cost of the inventory.
Even worse, if you don’t catch it fast enough, you could also put your merchant account at risk for chargebacks or even face legal trouble.
Big red flags:
- Requests for brand name only strips.
- Vague mission or unverifiable charity status.
- Pressure to ship immediately.
- Payment by credit card only.
Here’s How To Protect Yourself
- If it smells fishy, trust your gut and say no.
- Ask for EIN, 501(c)(3) documentation, and references—but know that these can even be faked.
- Never ship before verifying that the payment is legitimate.
What to Do If You’re Approached by a “Charity” For Diabetic Test
Legitimate charities will have verifiable credentials and will often work through established medical donation networks. If someone reaches out to your pharmacy unsolicited, requesting high-volume orders of brand-name diabetic supplies, your first response should be skepticism. A quick online search can often reveal past reports of fraud under the same organization name. When in doubt, pass on the opportunity or request cash payments.
Bottom Line: Trust but Verify
Diabetic testing supplies are a staple in many pharmacies, but they can also be a landmine. Stick with authorized distributors, and steer clear of suspicious “charity” sales that request brand-name-only test strips.
In the world of pharmacy, your margin for error is razor-thin. Protect your profits and your patients by being vigilant with these high-risk, high-volume items.
And as always, if you need help verifying vendors, navigating inventory questions, or boosting profits, Pharmacy Badass University has your back. We’ve got the tools, training, and support to help you grow safely and profitably.
Stay sharp and keep those scams out of your pharmacy.
