Medication Formulary & Prescription Drugs

Recently there have been many questions from our members regarding medication formulary and prescription drugs through CBIA/Aetna. Listed below are a few sample Q & A’s that we feel will be beneficial to you and your clients.

These frequently asked questions are intended to provide general assistance. If you have any further questions, please feel free to contact Aetna’s member services number at 1-800-270-0081 or CBIA’s customer service department at 860-525-2242.

What is a Medication Formulary and what is its purpose?

A Medication Formulary is an extensive list of safe and effective brand name and generic prescription drugs. It is a guide for physicians when they prescribe and pharmacists when they dispense medications. Drugs appearing on the formulary have been chosen on the basis of sound medical data, safety and cost. Aetna has determined that a carefully managed formulary process can decrease drug costs while ensuring high-quality medical care.

A formulary is one way that hospitals, insurance companies and managed care companies manage the rising cost of health care. The use of formularies has enabled companies that offer pharmacy benefits to provide coverage for medications without drastically increasing the cost of premiums.

Members can click here to access the complete formulary from Aetna.

How is a formulary developed?

The Aetna Medication Formulary Guide lists the "preferred" FDA-approved generic and brand name medications available through the prescription drug benefit plans. A formulary is designed to meet member, provider and customer expectations for access to quality, cost-effective medications. The formulary is regularly reviewed and updated as:

• new products come on the market,
• new studies are performed,
• new information on treatment, effectiveness, and cost of existing drugs becomes available.

The FDA-approved brand name and generic drugs chosen for the formulary are selected first and foremost based on their safety and effectiveness. Indeed, drugs that are being considered for the formulary undergo an extensive review process:

• Clinical pharmacists from Pharmacy Management staff review each drug using available literature from government agencies, medical associations, national commissions and peer-reviewed journals.
• Findings from this clinical review are forwarded to the national Pharmacy Quality Advisory Committee (PQAC), a group of physicians and pharmacists who are in active clinical practice within the community.
• The PQAC reviews the available clinical information and makes additional comments, which are sent to Aetna's National Pharmacy and Therapeutics (P&T) Committee.
• After evaluating available clinical information, comments from the PQAC, the National P&T Committee laces medications in one of three categories:

Category 1: The drug represents an important therapeutic advance. These drugs are always included on the formulary, regardless of cost.

Category 2: The drug is therapeutically similar to other available products. These drugs are further reviewed by Aetna for overall value, including cost and manufacturer volume discount arrangements, before being placed on the formulary.

Category 3: The drug has significant disadvantages in safety or efficacy when compared with similar products. These drugs are always excluded from the formulary, regardless of cost.

The final formulary or nonformulary status of a drug and relevant medical exception, precertification and step-therapy criteria are then communicated to the local health plan Quality Advisory Committees (QAC).

What is the difference between a brand-name drug and a generic?

Brand-name drugs are protected by a patent and manufactured by a specific company. Generic drugs are manufactured according to the same chemical formula of the brand-name drugs once the patents have expired. The Food and Drug Administration (FDA) requires that generic drugs have the same active chemical composition, and have the same potency and be offered in the same form as their brand-name counterparts. Brand name drugs usually cost more than generics because the manufacturer of the brand-name drug had to adjust the cost of the drug in order to recover research and development expenses.

Can I get any drug I want as a covered benefit under my benefit plan?

No. Coverage is based upon the terms and conditions of your benefit plan. If you have questions regarding your prescription drug benefits, please call the toll-free Member Services number on your member ID card.

Can my physician prescribe any medication he or she chooses?

Your physician is responsible for all treatment decisions can prescribe any medication he or she believes is appropriate for you; however, coverage of a prescribed medication is determined according to your prescription drug benefit plan. Please check your plan documents for more information about your prescription drug benefits.

Are medications that are new on the market placed on the formulary?

Until a new FDA-approved drug has been reviewed by the Aetna P&T Committee and a formulary determination made, it may not be listed on the formulary. Some benefit plans exclude coverage of new drugs until they have been reviewed, while other benefit plans allow for coverage of new drugs. Under those plans that allow such coverage, the nonformulary copayment will apply.

What does precertification mean?

Certain benefit plans may include our Precertification program. Precertification is designed to help encourage appropriate use of certain drugs in accordance with current medical literature, practice guidelines and FDA guidelines. If applicable to your benefit plan, the Precertification List included in the Aetna Medication Formulary Guide consists of drugs identified as having a narrowly defined use or as those that are more likely to be taken inappropriately or for too long a time period. The Precertification List is subject to change.

Your doctor must contact the Pharmacy Management Precertification Unit to request coverage for medications on the Precertification List. If the request is approved, the medication will be covered; however maximum duration of therapy or quantity limitations may apply.

How does a three-tier copay work?

The lowest copay of a three-tier copay applies to generic formulary drugs, the mid-level corresponds to brand name medications on the formulary, and the highest copay applies to nonformulary drugs.

• Example: $10 Generic Formulary Drugs
• $15 Brand Name Formulary Drugs
• $25 Nonformulary Drugs

What happens if a member’s current medication is not covered in the formulary?

Members may perceive the use of a formulary to be a restriction or decrease in benefits, in that some medications they currently use are not covered. You and your employees should be made aware that:

1. Medicines excluded from the formulary may be excluded because they may be less effective, may cause more side effects, or may cost more without having any clinical advantage.
2. For each drug that is excluded from the formulary there is an alternative that is at least as effective.
3. Each health plan company has procedures for providers to request coverage of drugs not on the formulary in special situations.
4. Members may always obtain the brand name prescription by paying the full price themselves.

What is a Formulary Exclusions List and how does it work?

A Formulary Exclusions List is a specific list of drugs that are excluded from coverage in closed formulary benefit plans unless a medical exception is obtained. Drugs on the Formulary Exclusions List are covered for members enrolled in open formulary plans; however, the nonformulary copayment will apply.

If it is medically necessary for a member in a closed formulary benefit plan to use a formulary excluded drug, the member's physician may contact the Aetna Pharmacy Management Precertification Unit to request coverage as a medical exception.