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Frequently Asked Questions Insurance

Prescription Drugs

  • The formulary for your health plan provides a list of medications that a team of health care specialists have approved. Your doctor will write a prescription based on your medical needs, but the formulary provides him with recommendations from the pharmacist and physician team. An effective formulary system provides a medication safety feature. When drugs and administration methods are systematically included (or deleted) in a controlled drug formulary, there are a number of benefits. For instance, each new drug added undergoes a peer review process that uncovers any safety concerns with the drug. Also, when drugs are systematically added to the formulary, there is adequate time to educate the staff before the drug is used. An organized formulary also ensures that the number and variety of drugs is kept to an effective minimum. There are approximately 13,000 prescription drugs on the market today and several drugs can often be used to treat the same condition. A formulary, based on safety and cost considerations, helps to limit the drugs recommended by your plan's health care professionals.
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  • When a drug patent expires other companies may produce a generic version of the brand name drug. A generic medication, also approved by the FDA, is basically a copy of the brand name drug and is marketed under its chemical name. A generic drug may have a different color or shape than its brand name counterpart, but it must have the same active ingredients, strength, and dosage form (i.e., pill, liquid, or injection), and provide the same effectiveness and safety as its brand name counterpart.
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  • A brand name drug is approved by the Food and Drug Administration (FDA), and is supplied by one company (the pharmaceutical manufacturer). The drug is protected by a patent and is marketed under the manufacturer's brand name.
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  • Yes. Generic drugs are less expensive than brand name products, and so the amount you pay as part of your prescription drug cost-sharing is less than what you pay for brand names. In addition, most plans charge you a lower copay if you use generic drugs.
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  • Contact your health plan directly for this information.
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  • No. Approximately half of all drugs on the market have generic versions.
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  • Valium is a brand name drug whose generic counterpart is Diazepam. On the other hand, Amoxicillin is a generic drug of the brand drug Trimox.
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  • A formulary is a list of both generic and brand name drugs that are preferred by your health plan. Often, many drugs on the market produce the same results equally well. Health plans will choose formulary drugs that are just as safe and effective as the alternatives but cost less. A team of pharmacists and physicians meet to review the formulary and make changes as necessary.
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  • Cost increases are due to several factors.
    • Pharmaceutical companies are producing a record number of medications and many carry a high price tag. It cost an average of $500 million to discover and develop one new medicine, and it takes an average of 12 to 15 years to bring a new medicine from the laboratory to the pharmacy shelf.
    • Drugs are used more and more to avert illness and hospital admissions. Asthma, heart disease, and ulcers are among conditions successfully being treated with drugs.
    • The over-age 65 population is growing larger and living longer and this leads to an increase in the utilization of prescription drugs.
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  • You will usually pay more for a non-formulary drug when a formulary version is available.
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