Health Insurance Articles
What Is A Drug Formulary
2009-12-14
A drug formulary, also called a prescription drug plan, is a list of specific drugs that your health insurance will pay for - oftentimes including both generic and name-brand prescription drugs. When the drug is prescribed but not listed, it is often up to the policyholder to pay for it out of pocket. All insurance companies have different lists, so it may be beneficial for you to compare them before you purchase a policy.
Most drug formularies have six categories of drugs. One is antidepressants, a category for medication used for treating depression. Another category is antipsychotics, drugs for treating mental illness like schizophrenia. There are also the categories of anticonvulsants - used for treating or reducing the severity of seizures - and antiviral, which are drugs used to treat HIV and AIDS. Drugs used to treat cancer are known as the antineoplastics, and finally, the last category is immunosuppressant, which are used to treat a number of different conditions. This last category of drugs are also used to help the body accept transplants, and for conditions of arthritis, lupus and rheumatoid arthritis.
A brand name drug is manufactured and sold under an original manufacturer's label. Most new drugs come under this category. Generic drugs included in the formulary are produced and sold under the chemical name. These drugs are approved by the FDA and usually produce the same results as the costlier brand name equivalents. They are required to include the same active ingredients used in brand name labels. Using generic drugs will reduce the cost of your health care expenses. However, you will likely have to talk with your doctor to get a drug that is equivalent to the name brand.
Some health care plans have certain conditions that come with the plan. Many plans have exclusions, which means they will not cover certain drugs. Often these exclusions are over the counter medications, medications that are used for cosmetic reasons, weight loss drugs, contraceptive devices, dietary or nutritional products, or dental products. Many will also incorporate a form of co-payment. This means that you will pay a certain part of your prescription costs out of pocket. Some co-payments are classified in tiers so that the amount you pay depends on the drug category or tier the medication is in. Tier 1 is usually the lowest payment for generic prescriptions, where tier 2 has a higher payment than 1 using brand name drugs. Tier 3 often includes new drugs with brand names and will be the highest costing category.
Overall when deciding on health insurance coverage, look at the company's drug formulary and discuss it with your doctor. This will be a benefit to you in the future.
