Prescription Insurance Coverage Questions to Ask Your Plan

Most people don’t realize how much their prescription drug costs can change - even if they stay with the same insurance plan. One year you pay $15 for your blood pressure med. The next, you’re handed a bill for $120. No warning. No explanation. Just a pharmacy counter and a shocked face. That’s not a mistake. It’s a gap in understanding your coverage.

Is your medication even on the list?

Every insurance plan has a formulary - a list of drugs it covers. But not all formularies are created equal. Some cover hundreds of generics. Others barely list the brand-name drugs you’ve been taking for years. The first question you need to ask: "Is my exact medication on the formulary?"

Don’t assume. Don’t guess. Check. Even if your plan says it covers "all prescription drugs," it doesn’t mean yours. Some plans exclude newer drugs, off-label uses, or medications deemed "non-essential." Others put your drug in a higher tier just to make you pay more. If you take insulin, antidepressants, or a specialty drug for arthritis or MS, this isn’t optional. It’s critical.

What tier is your drug on?

Formularies are split into tiers. Each tier has a different price. Here’s how it usually breaks down:

• Tier 1: Generic drugs - usually $10-$20 copay
• Tier 2: Preferred brand-name drugs - $30-$50 copay
• Tier 3: Non-preferred brand-name drugs - $75-$125 copay
• Tier 4: Specialty drugs - 25%-33% coinsurance, often $500+ per prescription

If your drug is in Tier 3 or 4, you’re paying way more than you think. A $300 monthly medication might cost you $100 out of pocket - but only if your plan covers it at all. Some plans put common drugs like metformin or lisinopril in Tier 2 just to push you toward generics. Others charge full price for drugs you’ve used for 10 years because they’re not "preferred."

How much do you pay before coverage starts?

Many plans have a deductible for prescriptions. That means you pay 100% of your drug costs until you hit that number. For Bronze Marketplace plans, that deductible can be $6,000. For Gold plans, it’s often under $150. If you take multiple medications, a high deductible could mean you’re paying $800 in the first month just to get your pills.

Ask: "Is there a separate prescription deductible?" Some plans bundle it with medical costs. Others keep it separate. If your plan has a $1,000 drug deductible and you need three prescriptions a month, you’re looking at $3,000 before your insurance kicks in. That’s not affordable for most people.

Do you have to try cheaper drugs first?

This is called step therapy. Your plan might require you to try a cheaper drug before they’ll pay for the one your doctor prescribed. For example: you need a biologic for rheumatoid arthritis, but your plan says you must try methotrexate first. Even if you’ve tried it for years and it didn’t work. Even if your doctor says it’s unsafe.

Step therapy is used in 37% of specialty drug cases. It delays treatment. It causes frustration. And it can make your condition worse. Ask: "Does this plan require step therapy for my medications?" And if yes: "How do I request an exception?"

Do you need prior authorization?

Prior authorization means your doctor has to get approval from your insurer before you can fill the prescription. It can take days. Sometimes weeks. For drugs like cancer treatments, mental health meds, or rare disease therapies, delays can be dangerous.

28% of Medicare Part D prescriptions require prior authorization. That’s almost one in three. And if your doctor forgets to submit the paperwork? You get turned away at the pharmacy. Ask: "Which of my medications need prior authorization?" Then ask: "How long does it usually take to get approved?"

Where can you fill your prescriptions?

Your plan might only cover drugs from certain pharmacies. This is called a network. If you use an out-of-network pharmacy, you could pay 37% more - or the plan might not cover it at all.

Some plans only work with CVS, Walgreens, or Walmart. Others limit you to mail-order for maintenance drugs. If you live in a rural area or rely on a local pharmacy, this matters. Ask: "Which pharmacies are in-network?" And: "Can I use my local pharmacy, or do I have to switch to mail-order?"

What’s the monthly cost?

Premiums are only part of the story. You also pay copays, coinsurance, and deductibles. A low-premium plan might look great - until you realize you’re paying $1,200 a month for your specialty drug. That’s why you need to calculate your total annual cost.

For example: if you take 12 medications a year, a Bronze plan might save you $200 in premiums - but cost you $1,842 more in out-of-pocket drug expenses than a Gold plan. That’s a net loss. Ask: "What will I pay annually for my medications, including premiums, copays, and deductibles?" Use the plan’s online tool. Enter your exact drugs and pharmacy. Don’t trust estimates.

What happens if you hit the coverage gap?

If you’re on Medicare Part D, you might hit the "donut hole." That’s when your out-of-pocket costs jump after you spend $5,030 on drugs in 2024. You pay 25% of the cost until you hit $8,000. Then catastrophic coverage kicks in.

But starting in 2025, that gap disappears. And insulin will cost no more than $35 a month. Still, if you’re on a high-cost drug now, you need to know how your plan handles the gap. Ask: "How does this plan handle the coverage gap?" And: "Will I qualify for any discounts before 2025?"

Can you switch plans if your coverage changes?

You can’t switch your plan just because your drug got dropped or your copay went up. You’re stuck until the next enrollment period.

Marketplace plans: Open enrollment runs from November 1 to January 15. Medicare Part D: Annual Election Period is October 15 to December 7. If your drug is removed from the formulary in March, you wait until next fall to switch. That’s why checking now matters.

Ask: "Can I change plans mid-year if my medications are no longer covered?" The answer is almost always no - unless you qualify for a special enrollment period. That’s rare. Don’t count on it.

What’s changing in 2025?

New rules are coming. Starting in 2025, Medicare Part D will cap your out-of-pocket drug costs at $2,000 a year. That’s a huge shift. But private plans aren’t required to follow it. So if you’re on an employer plan or a Marketplace plan, you’re not protected.

Also, Medicare will start negotiating prices for 20 high-cost drugs. That could lower premiums. But it won’t help you until 2026 or later. For now, focus on what you can control: your current plan, your medications, and your pharmacy.

What to do next

Here’s your checklist:

1. Make a list of every medication you take - including dosage and frequency
2. Go to your plan’s website and enter those drugs into their formulary checker
3. Check your pharmacy network - do you use an in-network location?
4. Calculate your total annual cost: premiums + copays + deductibles
5. Call customer service and ask: "Is my drug on the formulary? What tier? Any prior auth or step therapy?"
6. Write down the answers. Keep them in your wallet.

If you’re on Medicare, use the Medicare Plan Finder. If you’re on a Marketplace plan, use HealthCare.gov’s tool. Enter your exact drugs. Don’t guess. Don’t rely on your memory. This isn’t about saving a few dollars. It’s about not going broke because you didn’t ask the right questions.

People don’t realize it, but 63% of shoppers in 2022 didn’t check their drug coverage until after they enrolled. Then they got stuck. One man in Ohio paid $3,700 for a single prescription because his Silver plan had a $500 copay cap - and his drug was priced at $4,200. He didn’t know. He didn’t ask. He just assumed.

You don’t have to be that person.

What to do if you’re confused

If you’re overwhelmed, call your plan’s customer service. Have your drug list ready. Ask for a formulary document. Ask for a summary of your costs. Don’t let them hang up on you. If you’re on Medicare, contact your State Health Insurance Assistance Program (SHIP) - they offer free, unbiased help.

Prescription drug coverage isn’t just about price. It’s about access, timing, and predictability. The difference between paying $20 and $1,000 for a pill isn’t luck. It’s knowing the right questions to ask - before you fill your prescription.