Summary: Medicare Part D formularies are lists of prescription drugs covered under your Part D prescription drug plan. Each formulary divides generic and brand-name drugs into tiers. Understanding how drug formularies and tiers work is crucial for ensuring you get the prescription coverage you need. Estimated Read Time: 6 min
A Medicare Part D Prescription Drug plan formulary is the list of drugs that your prescription drug policy covers. Each insurance company can determine the drugs and their tiers on their formularies. However, carriers must abide by specific regulations. For instance, every formulary must include certain types of drugs.
Below, we review what a formulary for Medicare Part D is, how it can impact your plan choice, and how to find the best formulary for your needs.
Medicare Part D Formulary Explained
For many, prescription drugs are vital to maintaining health and well-being. Whether you need medication for a chronic condition or a prescription to treat an ailment, adequate coverage is essential. Understanding how Medicare Part D formularies work will help ensure you have the coverage you need to stay healthy.
The Medicare Part D formulary states which drugs receive coverage and the tier assigned to each drug within the drug plan. Tier assignment is important because prescription drug plans will cover drugs differently based on tier.
When enrolling in a Medicare Part D plan, you should review the formulary to ensure the plan covers all your medications.
Do All Medicare Part D Plans Have A Formulary?
All Medicare Part D plans have a formulary. Each formulary lists every drug the plan covers. Formularies must include both generic and brand-name medications.
There are six protected classes that each Medicare Part D formulary must include. Every Medicare Part D plan must cover at least two drugs in each class.
The six protected classes include:
- Anticonvulsants
- Antidepressants
- Antineoplastics
- Antipsychotics
- Antiretrovirals
- Immunosuppressants
Protecting these six drug classes allows you access to treatments for conditions like:
- Epilepsy
- Mental Illness
- Cancer
- HIV/AIDS
- Organ transplant
While these drugs have no cost restrictions, they must at least receive some coverage from the Medicare Part D plan to comply with federal standards.
All Medicare Part D drug formularies must also include coverage for commercially available vaccines if the vaccine is necessary for prevention and not already covered by Medicare Part B.
Vaccines covered by Medicare Part D include:
- Tdap (tetanus, diphtheria, and pertussis)
- Shingles
- Chicken Pox
- Measles, mumps, rubella (MMR)
- Meningococcal (meningitis)
Medicare Part D does not cover the following vaccines because they are covered by Medicare Part B:
- Flu
- COVID-19
- Hepatitis B
- Pneumococcal
- Tetanus
- Rabies
Will Medicare Part D Cover A Drug Not On The Formulary?
If a drug is not listed on your plan’s formulary, you will be responsible for the full cost of that drug.
Not all available medications are covered by Medicare Part D. Several drug categories are not available on any Medicare Part D prescription formulary. These drugs include:
- Weight loss medications
- Drugs for cosmetic purposes, such as hair growth
- Medication for cough and cold relief
- Prescription vitamins and minerals
Additionally, Medicare prescription drug plans generally do not cover over-the-counter medications like Tylenol or Motrin.
If you are prescribed a drug by your physician that is unavailable through your prescription drug plan’s formulary, you may need to pay the total cost of the drug out-of-pocket. If prescription costs are a concern, talk with your doctor to explore your options regarding your medications. You may also try to appeal the coverage decision.
As a Medicare beneficiary, you have the right to ask your Medicare Part D plan to cover a prescription drug you believe should receive coverage. You will need a letter from your provider detailing why you require the medication. Your carrier will review the appeal and act accordingly.
What Are Medicare Part D Formulary Tiers?
Medicare Part D formulary tiers categorize the drugs each plan covers by up to six coverage levels. The cost of your prescription will directly correlate with its tier. Typically, a drug in a lower tier will cost you less than a drug in a higher tier.
Medicare Part D formulary tiers example (your plan’s tiers may be different):
- Tier 1- Preferred Generic (lowest cost)
- Tier 2 – Generic
- Tier 3 – Preferred Brand
- Tier 4 – Non-Preferred Drug
- Tier 5 – Specialty Tier (highest cost)
Which tier your medications fall under will determine what you pay out-of-pocket for your prescriptions. Each Medicare Part D plan covers tiers differently, so knowing where your drugs fall is crucial to understanding how much you will be paying out-of-pocket. Sometimes, your doctor can switch a brand-name drug for a lower-tier generic to help you cut costs. Always consult with your doctor when making decisions regarding your medications.
If your Medicare Part D plan has a deductible, some tiers may be exempt. For example, you may be able to get coverage for preferred generic drugs in tier 1 without having to meet your deductible. However, if you need a medication in tier 2, you will then need to meet your plan’s deductible before coverage starts.
What Is a Medicare Part D Formulary Tier Exception?
If you believe one of your prescribed drugs should be in a lower tier on your Medicare Part D formulary, you may request a tier exception. This helps lower cost-sharing for you by lowering your drug’s tier.
To qualify, your doctor must prove that a lower-tier drug option will not be as effective in treating you as the higher-tier drug. You will then need to provide this information to your carrier, who will ultimately decide whether to grant the tier exception.
Common occurrences where a tier exception may be approved include:
- Your doctor prescribes a medically necessary prescription not listed on your plan’s formulary
- You are using a preferred drug that moves to a non-preferred tier
- Your doctor prescribes a drug that warrants prior authorization that was denied
- The drug you need is removed from your plan’s formulary, and no other suitable options are available
When Can Medicare Part D Plans Change Their Formularies?
Medicare has set guidelines allowing carriers to change their formulary annually if necessary. There are several reasons a plan may change its formulary during the year. These include:
- Changes to drug therapy treatment by FDA
- New drugs are released
- Further medical information becomes available
- FDA considers the medication unsafe
Your drug plan carrier must give you a 30-day written notice before making any changes to their plan’s formulary unless the drug is deemed unsafe by the FDA. If this happens, your plan will likely recommend a similar drug to treat your condition. You must discuss these changes with your doctor to receive a new prescription.
How To Learn More About Medicare Drug Formularies
If you need more information regarding Medicare Part D formularies, get your questions together and give our team of licensed agents a call at the number above. Our team can help you understand how to review a drug formulary when comparing plans.
Already have a Medicare Part D plan? Review your plan each year during the Annual Enrollment Period. If unexpected formulary changes occur, you can switch coverage during this time for the upcoming year. Make sure to consider any medications you may need in the future when reviewing your plan’s formulary.
Sources
Medicare Part D Drug Plans, Medicare. Accessed July 2023.
https://www.medicare.gov/drug-coverage-part-d/what-medicare-part-d-drug-plans-cover
Medicare and You, Medicare. Accessed July 2023.
https://www.medicare.gov/publications/10050-Medicare-and-You.pdf
