In general, Medicare Part D prescription drug plans cover many drugs that are:
- Available only by prescription
- Used for a medically accepted condition
- Approved by the FDA
- Sold and used in the United States
- Not covered under Original Medicare, Part A or Part B
Also, Medicare Part D prescription drug plans are required to cover at least two drugs in each therapeutic class of drugs, along with certain vaccines and diabetes supplies. Medicare also requires Part D prescription drug plans to cover almost all drugs in these six classes: antidepressants, anti-convulsants, anti-psychotics, immunosuppressants, cancer drugs, and HIV/AIDS drugs.
What is a prescription drug plan formulary?
Each Medicare Part D prescription drug plan has its own formulary, which is a list of drugs covered by the plan. Because every formulary is different, it’s important to check the plan’s formulary to see if your medications are covered. Most plans provide access to their formulary on their websites; you can also request a copy by calling the plan’s customer service number.
Medicare Part D prescription drug plans are allowed to change their formularies each year. They may also change their formularies during the year if drug therapies change, new drugs are released, or new medical information becomes available. If a formulary change affects a drug you are taking, or your drug is moved to a higher cost-sharing tier, your plan must notify you at least 60 days in advance. This prior notification requirement does not apply if a drug is removed from the market due to safety reasons. However, your plan is required to send you notification after it has been removed.
Depending on the change, you may have to pay more for the drug or switch to a new medication. In some cases, you can continue taking the drug you were on until the end of the year. You can also ask for an exception to waive your plan’s coverage rule if your doctor or prescriber believes it’s medically necessary for you to take a medication that isn’t included in your plan’s formulary. You may also request an exception if the drug is covered by your plan on a higher tier and taking a different, less expensive medication isn’t as effective for your condition.
If your Medicare prescription drug plan doesn’t cover a medication you think you need, covers the medication on a higher tier, or requires a coverage rule that you think should be waived, your doctor can submit a “Model Coverage Determination Request” form to your plan. Your doctor or prescriber will need to provide a medical justification orally or in writing for why the exception should be granted.
You can either call your plan to make the request or mail the completed form to your plan. Your Medicare prescription drug plan then has 72 hours to respond. If you need an expedited request because the 72-hour wait time for a standard request could put your life in danger, you can submit an expedited request and your plan must respond with its decision within 24 hours.
What are drug tiers?
Many Part D prescription drug plans place prescription drugs into different cost-sharing “tiers” or levels. A drug in a lower tier will cost you less than a drug in a higher tier. If your doctor prescribes a drug on a higher tier rather than a similar drug on a lower tier, you may be able to file an exception and get a lower copayment (see above for more information on how to file an exception). You can also ask your doctor or prescriber if there is a generic or less-expensive medication available that could also be effective at treating your condition.
Here’s an example of how a plan might divide its drug tiers:
- Tier 1 — Most generic drugs. Tier 1 drugs will cost you the least amount.
- Tier 2 — Preferred brand-name drugs. Tier 2 drugs may cost you more than Tier 1 drugs.
- Tier 3 — Nonpreferred brand-name drugs. Tier 3 drugs may cost you more than Tier 1 and Tier 2 drugs.
- Tier 4 — Specialty drugs. Tier 4 drugs are typically unique, very high-cost drugs and are likely to have the highest copayment or coinsurance.
What are some of the prescription drug plan coverage rules?
Most Medicare prescription drug plans use coverage rules, or limits on coverage, for certain prescription drugs. Coverage rules promote the proper utilization of medications when medically necessary, and these rules also help control drug plan costs. Some specific rule types are:
- Prior authorization — If your plan requires prior authorization for a medication you are taking, you or your doctor will need to contact the plan before you can fill your prescription. Your doctor will have to show that there is a medically-necessary reason why you must use that specific drug in order for it to be covered by your plan.
- Step therapy — Step therapy is a policy that requires you to first try a similar, lower-cost drug that has been proven effective for most people with your condition before you can “step” up to a more expensive drug. If you have already tried a lower-cost drug and it didn’t work, or your doctor believes your condition makes it medically necessary for you to take the more expensive medication, he or she can contact your plan to ask for an exception to this coverage rule.
- Quantity limits — Plans may limit the amount of drugs they will cover for you over a certain period of time for safety and cost reasons. For example, a plan may cover only a 30-day supply of heartburn medication. If you need more, your doctor may need to provide more information about your medical condition to the plan.
What if my Part D plan does not cover my prescription drugs?
If you are a member of a stand-alone prescription drug plan or a Medicare Advantage plan with prescription drug coverage, you have rights and options if your medication is not listed on your plan’s formulary:
- You can ask your doctor if you can switch to another drug that is on the formulary.
- If you paid out of pocket for a medication that you think your plan should have paid for, you can ask the plan to reimburse you by requesting a coverage determination.
- You can ask your plan for an exception to cover your drug. To ask for an exception your doctor must provide a statement orally or in writing that supports a medical necessity for the drug.
There are two types of exceptions:
- Formulary exception: You can request a formulary exception if your doctor believes it’s medically necessary for you to take a drug that is not on the formulary, or your doctor believes that a coverage rule should be waived (such as a quantity limit or step therapy requirement).
- Tier exception: You may also request a tier exception if you believe you should be able to get a non-preferred drug covered at a lower cost-sharing tier because taking an alternative drug on a lower tier wouldn’t be as effective for treating your condition or would be harmful for you.
If you are a new member of a plan, you may be able to get a temporary supply of a drug you were taking when you first joined the plan if it isn’t on the formulary or are on the formulary but require prior authorization or step therapy. Under this “transition policy,” the plan will cover a temporary supply (typically about 30 days) if you need a refill during the first 90 days of your new membership in the plan. Part D transition policies cannot be used to buy a non–Part D drug or to get a drug out of the plan’s network, unless you qualify for out-of-network access.