How Do I Know if My Medications and Drugs Are Covered by Insurance?

When it comes to your medication, it’s important to be clear on what your insurance company will pay for and what they won’t. Prescription drugs can be costly, especially if you don’t have insurance.

It’s a good idea to check your formulary periodically, as insurers can change the list throughout the year.

Chances are that the information you received when you signed up for your health plan, such as the members’ summary of benefits and coverage, will also have everything you need to know about your coverage.

While there are exceptions, typically if a drug is not on the formulary, it will not be covered even if a doctor prescribes it. “In that case, your doctor would look for a similar drug that might be available to substitute for it,” says Michael Giusti, an analyst with InsuranceQuotes.com.

What can be confusing, Giusti says, is that even when a drug is on the formulary, that doesn’t automatically mean it will be covered. “In some cases, drugs that are on the formulary still require another step, called a prior authorization,” says Giusti. “That’s where the prescribing physician needs to file extra paperwork justifying why that drug is the appropriate one to use. This is often the case when it is a more expensive drug than a similar less expensive one that is also offered.”

But there’s another thing to keep in mind: “Look out for QLs (quantity limits),” says clinical pharmacist Claudia Cometa, PharmD, the owner of Avanti Health Consultants and the author of Patient, Empower Thyself! If there is a QL, that means the insurance company will only cover a specific quantity in a specified amount of time. So you’ll need to pay attention to when you’ll reach the limit and get additional approval to continue taking that medication.

Read your insurance plan carefully, because you could also have to deal with “step therapy” in which your insurance requires you to try a less-costly medication on your plan’s formulary than what your doctor prescribed. If the medication doesn’t work for you, you have to show why — or explain if you had a negative reaction to it. Then you “step” to the medication you wanted all along.

A recent change to many drug formularies is the addition of biosimilars in the place of biologics, medications derived from living organisms like bacteria or animal cells. Biosimilars are drugs that are very similar to biologics, with no clinically meaningful differences in their efficacy or safety.

“You can think of these products as the generic version of a biologic. Biosimilars are produced when the patents expire for a branded biologic, enabling pharmaceutical innovators to compete against the branded product for revenue,” says Olivia Deitcher, the CEO and founder of Zest Health, a virtual dermatology clinic. Because of the increased competition, biosimilars are often less expensive for your health insurer, so they may receive better coverage than their branded counterparts — though not always.

“We have found that one-third of patients who come to us on biologics can be successfully switched [to other treatments] and still keep their skin clear, have sustained relief, and save money at the pharmacy,” she says.

On the other hand, Dr. Cometa notes, “If the biosimilar requires a pharmacist to compound the medication, it will likely not be covered.”

An effective letter adheres to a few key points. “The most important thing is language. Insurance companies respond to very specific phrasing,” says Kiara DeWitt, RN, a pediatric neurology nurse in Fort Worth, Texas, whose patient advocacy efforts include helping them decode insurance denials and navigate billing misfires.

“If your provider says, ‘patient needs X,’ that is a maybe. If they say, ‘documented failure on formulary alternative,’ the odds go way up,” she says. “If they add ‘evidence of escalation protocol failure’ or ‘risk of irreversible condition progression,’ that kicks it up again. These details matter. Get clinical. Get exact. Avoid emotion. Speak their language.”

Some insurance plans allow formulary exceptions to be submitted online. Check your health plan’s website to see if you can file electronically. If you’re denied approval, the Patient Advocate Foundation advises calling your health plan about the denial. Every plan is required to have an appeals process, so ask what your timeline is for submission. You can file the appeal on your own, ask your doctor for assistance, or seek out a patient advocate to help.

• When it comes to drug coverage, your insurer’s formulary is key: It tells you what’s covered and what’s not.
• Don’t assume that what’s covered on January 1 will still be covered six months later. Check the list periodically for changes, which can be made at any time.
• If your drug isn’t covered, see if your doctor can find an alternative that’s on the list. If they can’t, have your doctor file a formulary exception. If that fails, fight on with an appeal.