The Basics of Prescription Drug Tiers
Most health insurance companies organize the prescription drugs they cover into a tiered formulary system. A formulary is a list of covered medications, and the tiers are categories that determine your cost-sharing responsibility, such as copayments or coinsurance. Generally, the higher the tier number, the higher your out-of-pocket expense. While a basic formulary might have three tiers—low-cost generics, preferred brands, and non-preferred brands—some plans, particularly those in the Medicare Advantage and commercial markets, utilize a more complex six-tier structure.
This expanded tier system allows for more granular cost management by the insurer, but it can lead to confusion for patients. The most significant area of confusion is often the highest tier, which can be defined in fundamentally different ways depending on the provider. Therefore, relying on a general understanding of drug tiers without checking your specific plan's formulary can lead to significant financial surprises at the pharmacy counter.
Tier 6 as Low-Cost Select Care Drugs
For some health plans, particularly certain Medicare Part D and Medicare Advantage plans, Tier 6 is designated as a "Select Care" or "Low-Cost" tier. This tier typically includes a limited list of generic or low-cost brand-name drugs for common chronic conditions like diabetes, high blood pressure, and high cholesterol, often with a very low or $0 copay to encourage adherence. Common examples that might be in this tier include Lisinopril, Atorvastatin, and Metformin. This approach aims to improve patient health outcomes and reduce overall healthcare costs by making essential maintenance medications highly accessible.
Tier 6 as Highest-Cost Specialty Drugs
Conversely, other insurance formularies use Tier 6 as the most expensive tier, typically for specialty drugs. These are high-cost medications for complex, chronic, or rare conditions such as cancer, multiple sclerosis, and rheumatoid arthritis. Specialty drugs often require special handling, administration methods like injections, and close patient monitoring. Characteristics of these drugs include extremely high costs, distribution through specialty pharmacies, and the need for prior authorization. Instead of a fixed copay, patients often pay a higher coinsurance for these medications. In this structure, Tier 5 may also contain specialty medications, but Tier 6 is usually for the most expensive, non-preferred options.
Why the Inconsistency in Drug Tiering?
The lack of a standardized definition for drug tiers stems from the fact that health plans and Pharmacy Benefit Managers (PBMs) negotiate and structure their formularies independently. Each plan is designed to manage costs in a specific way and can define its tier system to offer different coverage options. This allows plans to cater to various customer needs, such as prioritizing low-cost preventative care or managing the high expenses of specialty medications.
Comparison of Tier 6 Definitions
| Feature | Low-Cost Select Care Tier 6 | High-Cost Specialty Tier 6 |
|---|---|---|
| Drug Type | Common generics for chronic conditions (e.g., blood pressure, diabetes) | High-cost specialty drugs for complex diseases (e.g., cancer, MS) |
| Patient Cost | Very low to $0 copay | Highest cost, often a high coinsurance |
| Goal | Promote adherence to long-term preventative care | Manage the costs and usage of very expensive treatments |
| Administration | Typically oral tablets or capsules | Often requires specialized administration like injections or infusions |
| Distribution | Regular retail or mail-order pharmacies | Limited to specialized pharmacies |
Navigating Your Prescription Benefits
Due to the variability in tier definitions, it is crucial for patients to understand their specific health plan's formulary. To do this, locate your formulary, often available online or by calling member services. Search for your specific medication to determine its tier and the associated copayment or coinsurance. If your drug is in a high-cost tier, discuss potential lower-cost alternatives with your doctor. For additional information on drug tiers and managing costs, the official Medicare website provides an overview of how drug plans operate.
Conclusion
Understanding what are tier 6 drugs requires a deep look into your personal health insurance plan, as the classification is not standardized. Whether it represents a low-cost preventative medication or the highest-cost specialty treatment, the financial impact on a patient can be substantial. By proactively consulting your plan's formulary, you can avoid surprises, make informed decisions about your medication, and manage your out-of-pocket costs more effectively.
