Health Insurance Articles
How Prescription Drug Costs Are Addressed By Healthcare Insurance Plans
2010-07-21
If you take prescription drugs, it is important to understand how health insurance coverage works in relation to these prescriptions. With ever increasing costs, you need to have a solid and affordable way to pay for all prescription needs. Health insurance can be a great way to do it, but you need to have an understanding of the way that health insurance coverage works.
First, you obviously need to have health insurance coverage that includes prescription drugs. There are some health insurance plans that do not cover prescription drugs. If your plan does not have drug coverage, there could be an option to purchase an independent drug plan. If that is not possible in your area, you will need to get a different health insurance plan or pay for your prescription needs out-of-pocket.
If your health insurance does cover prescription drugs, you need to understand what you get. Like everything else, you get what you put into it. If you pay more money, your health insurance coverage is likely to give you better options and pay more for your prescription drugs. Most plans have a yearly prescription drug benefit. This is a maximum amount of what will be covered in a single year. That number will vary depending on how good your health insurance coverage is and how much you are paying into it.
You should also expect a copayment. That means the amount that you will pay for different prescription drugs. For instance, if the cost of a drug is $100 for a 30-day supply, you may have a $15 copayment, meaning it will cost you $15, and your insurance will cover the rest. The amount of the copayments will often vary by the type of drugs that you need. Generic drugs not only cost less, but generally have a much high percent of reimbursement. Name brands will likely not only incur a higher cost, but also a higher copayment. A generic might be $20 for a 30-day supply with a reimbursement rate of 90 percent, so you pay $2. The name brand of the same medication in the same amount might cost $100 at a 75 percent reimbursement rate, where you will pay $25.
All health insurance companies that offer prescription drug coverage maintain a formulary, or a list of all medications that are available through their plan. Drugs not on this list, often called non-formulary drugs, will have a higher copayment. These can include experimental drugs, as well as drugs that may not be recognized on the list. All in all, you can save a lot of money with health insurance coverage of prescription drugs, but you need to know what you are and are not getting.
