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Coverage and cost

  • What is a tiered benefit design?

    A tiered benefit design refers to a drug benefit with different copay or coinsurance levels.

    For example, a three-tier benefit design is a prescription drug benefit with three different cost (or copay) levels. Each tier is based on the medication prescribed.

    At the pharmacy, you will pay the least for the first-tier prescription drugs and the most for the third-tier prescription drugs.

    Generally, in a three-tier design, the first tier covers generic drugs. The cost to you for a first-tier drug might be anywhere from $5 to $20. The second tier covers brand-name drugs on the drug list. The cost to you for a second-tier drug might be anywhere from $15 to $30 more than first tier generic drugs. Second tier, brand-name drugs are preferred drugs and third tier drugs have always been referred to as Non-preferred Brand drugs and they are included in the formulary. The cost to you for third tier drugs can be significantly more than first and second tier drugs.