For several reasons, the cost of prescriptions drugs in the U.S. is higher than any other country. While this is an issue none of us can solve at an individual level, how can you best support your employees with this growing financial burden? The answer: education and a proactive broker.
Formulary
Consumers simply want to fill their prescription needs. However, it’s first important to understand the insurance company “formularies” so you know how your prescription plan works. Did you ever wonder why your drug might fall under the $10/$30/or $50 copay? In short, the more common and inexpensive a drug, the less it will cost. These drugs are in categories Tier 1 or Tier 2 formulary; also known as generic. The more rare, specific, or new drugs are usually Tier 3 or “brand”. In the worst case scenario the drug will be excluded from insurance coverage as Tier 4 or non-formulary. A health insurance provider will financially incentivize members to seek lower cost drugs, typically generic, by charging a lower copay.
Most Affected
The common strategy of offering Silver and Bronze plans is cost effective from a premium standpoint, but exposes employees to high Rx costs. Health Saving Account (HSA) plans are a terrific strategy from a tax standpoint, but are one of the worst financial decisions if a brand name drug is regularly needed. Lastly, anytime policies change to a new health insurance provider, it exposes employees to potential Rx costs increases because every insurance carrier has a different “formulary”.
Best Solutions
There is no reason to limit employees to a certain plan(s) that the company contributes towards; instead, allow employees to “buy-up” by paying the additional cost for stronger plans. Employees selecting a Bronze or any HSA plan should be aware of the financial burden if they require a Brand name Rx. Both these solutions of “buy-up” plans and employee education can and should be managed through an automated online platform so there is no added Administrative work. When you require a health insurance provider change at the company level, a proactive broker is crucial. They can help educate employees by assisting with the “pre-authorization” Rx process. This process requires the prescribing doctor to complete a short form documenting need for Specific Brand Rx to reduced it to a lower cost tier.
Creative Ideas
There are many discount Rx programs now available online. Perhaps one of the best currently available is GoodRx. This site allows consumers to fill prescriptions while avoiding the insurance companies altogether. Financial discounts through discount prescription programs can often be greater than going through a health insurance provider.
