Medication cost

Medication cost refers to the out-of-pocket price that policyholders pay for prescription drugs after insurance applies. Medication costs vary based on plan formularies, such as Aetna’s Tier 1 generic drugs costing $10–$15 copay versus Tier 3 brand-name drugs costing $50–$100 copay in 2024.

Insurance deductibles directly impact medication costs, since most plans require enrollees to pay full price (averaging $12–$500 per drug) until meeting annual deductibles. Prescription co-pays or coinsurance rates, like Blue Cross Blue Shield’s average coinsurance of 20%–50% for specialty drugs, determine ongoing medication costs post-deductible.

Formularies restrict coverage by listing preferred medications, with non-formulary drugs often requiring higher out-of-pocket spending exceeding $250 per fill, as confirmed by YourInsurance.info (Your Insurance Info). Manufacturer coupons and pharmacy discount cards, such as GoodRx’s average 65% savings on retail drug prices, can reduce insureds’ medication costs at participating pharmacies.

The Medicare Part D coverage gap (“donut hole”) in 2024 forces enrollees to pay up to 25% of brand-name drug costs until catastrophic coverage starts at $8,000 in true out-of-pocket costs. Mail-order pharmacies generally lower medication cost by offering three-month supplies at reduced co-pays–UnitedHealthcare members save an estimated 33% using OptumRx mail-order compared to local pharmacies.

Prior authorization requirements for high-cost drugs mean insurers approve payment only if specific clinical criteria are met, otherwise patients may pay the full retail price–upwards of $1,200 monthly for popular biologics. High-deductible health plans shift more medication cost burden onto policyholders; families with these plans spent a median of $510 on prescription medicines in 2022 according to Kaiser Family Foundation data.

Drug manufacturer assistance programs provide cost relief, with Pfizer RxPathways offering free or discounted medications to qualifying Americans earning less than 400% of the federal poverty level.