If you take more than a few medicines and you're choosing a health insurance plan, look closely at each plan's drug benefits. Doing that homework could save you money on your prescriptions for the next year.
Got questions about prescription coverage? These answers may help you prepare and feel confident about comparing prescription benefits.
Do all health plans cover prescription drugs?
All health plans for sale in your state's Marketplace must offer prescription drug coverage, as well as those sold on the individual market or offered through a small employer. It's one of 10 essential health benefits that plans must have, according to the Affordable Care Act. Large employers (those with 50 or more employees) are not required to offer the essential health benefits, but nearly all do.
Check the summary of benefits for plans offered by your employer to see if it covers prescription drugs.
Are prescription drug plans the same in every state?
No. All health plans in a Marketplace must include prescription drug coverage, but each state selects a "benchmark" health plan -- one that available plans in the state must look like. The benchmark plan has a list of covered medicines, called the formulary. But even within the benchmark formulary, plans have some flexibility. For instance, although plans have to include the same number of drugs within each class as the benchmark plan, they may choose which ones to cover.
How do I know if a health plan will cover the medicines I take?
Check the plan's formulary, also known as a preferred drug list. You should be able to get this from any health plan you're considering. Sometimes a plan's formulary will be on its website.
The formulary lists each brand and generic name of medicines that the plan will help pay for. To look for your medicines, you need to know:
- The medicine's exact name
- The dose you take
- How many pills your doctor usually prescribes
Keep in mind that formularies can change. Medicines can be added or removed. A generic drug can replace a brand name one. Or one generic drug can replace another generic drug.
What if my medicine isn't on a plan's formulary?
If you can't find your medicine on a health plan's drug list in your state's Marketplace, you can request that your plan cover it or give you access to it. All plans sold on the Marketplace are required to have an exception process to request access to off-formulary drugs.
You can request that your insurer cover a medication not on its formulary with the help of your doctor to explain the medical need. If your request is denied, you have the right to appeal your health plan's decision.
What will I pay for medicines?
With some health plans, you pay a coinsurance for your medicines. This is a set percentage of the drug's cost, such as 30%. With other health plans, you pay a prescription copay, which means you pay a fixed amount for each medicine you buy.
Many formularies have two or more cost levels, called tiers. The copayment for each tier will likely be different. Higher level tiers cost you more. For instance, a third tier medicine costs more than a first tier one.
Many health plans have three or four tiers of costs:
- Tier 1: Generic medicines, which cost the least
- Tier 2: Preferred, brand-name medicines
- Tier 3: Non-preferred, brand-name medicines
- Tier 4: Specialty medicines, which are often costly, brand-name medicines. For instance, chemotherapy may be a fourth tier medicine.
Keep in mind that you may have a separate deductible for prescription drugs. You may need to pay it as well as a deductible for medical services. Look at a plan's summary of benefits about prescription medicines to see what you'd be responsible for paying.
After picking a health plan, how can I save money on my medicines?
You may be able to save more money even for medicines on your plan's formulary. Here's how:
Compare your medicine's price at local pharmacies. Some pharmacies also have a club where you can get a discount.
Check prices on online and mail-order pharmacies. First, make sure it’s a legitimate site. Your health plan may direct you to a preferred mail-order pharmacy, especially for prescriptions you take regularly for chronic conditions. The FDA warns against the potential dangers of buying medicine on the Internet. Some signs of a trustworthy web site include:
- It's located in the U.S.
- It's licensed by the state board of pharmacy where the web site is operating. (Look for the National Association of Boards of Pharmacy's (NABP) Verified Internet Pharmacy Practice Sites Seal, which is also called the VIPPS seal.)
- The site has a licensed pharmacist available to answer your questions.
- You need a prescription from your doctor to buy a medicine.
- There is a phone number listed for a person you can talk to about a problem or to ask questions.
Set up a flexible-spending account (FSA). Some employers offer these. You determine an amount to come out of your paychecks over the year. That amount is taken out before taxes so you can use it to pay for health expenses, including medicines. There is a limit to how much money you can put in an FSA and any money not used during the year is forfeited, so plan carefully.
Cost-sharing reductions. If your income is below 250% of the federal poverty level ($32,200 for an individual or $66,250 for a family of four) and you buy a plan through the Marketplace, you may qualify for a reduction in the plan’s cost-sharing, which includes prescription drugs. You must enroll in certain plans to receive this benefit. Contact your state Marketplace to see if you qualify.
Check out a prescription assistance program. Many health plans and some states have a prescription assistance program. Look on Medicare.gov for your state's program (search for “state pharmaceutical assistance program”). NeedyMeds.org and RxAssist.org are two additional resources for finding drug assistance programs. Most pharmaceutical companies and charities also offer similar programs.
Medicare Extra Help Program. If you qualify for any of the Medicare Savings plans, such as Qualified Medicare Beneficiary (QMB) program, Specialized Low-income Medicare Beneficiary (SLMB) program, Qualified Individual (QI) program, or the Qualified Disabled and Working Individuals (QDWI) program, you will automatically qualify for help paying your prescription drugs. Check with your state’s Medicaid office to find out if you qualify for one of these program.