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How to read a drug list

Who is this for?

Michigan Health Insurance – Customer Service – Pharmacy

If you want to use a drug list to find out if we cover your medication, this information will help you understand how to read one.

If you need to use a drug list to see if your health benefit plan covers your prescription medication, you might find they're a little hard to decode. We'll help you figure out the difference between Tier 1 and Tier 2, formulary versus nonformulary, closed and open plans and more.

What's a drug list, or formulary? It's a list of drugs approved by the U.S. Food and Drug Administration and covered by Blue Cross Blue Shield of Michigan and Blue Care Network.

  • Where can you find drug lists? We have them assembled here.

Tiers

Tiers are important when it comes to understanding prescription drug coverage and drug lists. Medications are grouped by tiers:

  • Tier 1 (also called Formulary Preferred). Drugs listed as Tier 1 are preferred because they offer the best combination of effectiveness, safety and value. They usually have the lowest copays of the three tiers.
  • Tier 2 (also called Formulary Options). These are usually brand name versions of generic drugs, and cost more. 
  • Tier 3 (or Nonformulary). Drugs not on the approved list. They typically have the highest copays, and may not be covered at all.

Know your plan

Your prescription drug coverage (also called a drug rider) has tiers, too. Before looking at a drug list, make sure you know whether your coverage is:

Flat, 2-Tier or 3-Tier (Triple-tier). These terms tell you your copay amounts for prescription medications. A copay is the amount of money you pay towards the cost of the drug.

  • Flat: your copay is the same for all drug tiers.
  • 2-Tier: your plan has two fixed copays, such as $10 for Tier 1 drugs and $25 for Tier 2.
  • 3-Tier or Triple-tier: your plan has three fixed copays, one for each tier of drugs, such as $5, $10 and $30.
  • Some plans combine a fixed copay amount with a percentage. For example, your 2-Tier plan may have a $15 copay for Tier 1 drugs, and a 40 percent copay for Tier 2. This means you pay 40 percent of the total cost of the medication. Some plans are completely percentage-based. See below.

Open, closed or percentage-based. These terms tell you what prescription medications your plan covers.

  • Open: your plan covers Tier 1, Tier 2 and Tier 3 drugs
  • Closed (or managed): your plan only covers Tier 1 and Tier 2 drugs
  • Percentage: you pay a fixed percentage of the cost of a medication for all tiers.

Reading a drug list

Drug lists typically group medications according to what they are used for, or the condition they treat. For example, you’ll find Prilosec under “Gastrointestinal agents.”

Let’s look at a scenario to see how a drug list works.

Your doctor prescribes Imitrex for your migraine headaches. You have a 2-Tier Closed plan through Blue Care Network with a $5 copay for Tier 1 drugs, $25 for Tier 2.

  • You look for Imitrex in the Custom Drug List Quick Guide for Members (PDF), Blue Care Network’s list of the most commonly prescribed drugs.
  • Under “Migraine,” Imitrex is listed as Tier 1, so it’s a $5 copay.
  • It also has the word (all), a (g) and a (QL) after it.
  • “All” means all forms of the drug, since Imitrex comes in both tablets and a nasal spray.
  • You check the footnotes at the bottom of the page. They tell you (g) means there’s a generic form of Imitrex available. That’s what will be used to fill your prescription.
  • (QL) means that there is a quantity limit for this drug. Your doctor can only prescribe so many for you.

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