5 ways to beat your insurance copay

"I don’t need to worry about drug prices. I have insurance!”
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At GoodRx, we hear people say this all the time. After all, isn’t that what health insurance is for? You pay your premium and then insurance pays for your medical bills. Right?

If you use GoodRx, you probably already know that prescription drug insurance isn’t what it used to be. Not long ago, most Americans had generous prescription benefits as part of their insurance. You probably remember $10 copays and never being shocked at the pharmacy counter.

So, what’s changed? In general, health insurance is simply paying for less than it used to. The cost of healthcare has gone up, payors (whether the insurance company, your employer, or even the government) need to control their costs and they shuffle that cost to you, the patient, in different ways. As a consumer, you need to watch out for these “features” of your insurance policy, all of which could cost you at the pharmacy counter:
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• Deductibles. Most plans these days have deductibles, where you’re responsible for your own costs up to a certain limit. In fact, deductibles are increasing faster than wages in the US. Some common plans now have up to a $5,000 deductible! Many Americans now have high-deductible health plans (HDHPs), which means we’re on the hook for most of our healthcare costs throughout the year.
• Formularies. Formularies are the list of drugs that insurers cover—and they’re shrinking. Fewer drugs are being covered and more drugs are being excluded. If your drug is not on the list, you might be hit with the full cash price of the drug unless you find other ways to save.
• Tiers. Formularies often price drugs by tier; each tier indicates how much you’ll pay for a covered drug. Recently, more and more tiers have been added to increase your copay. A Tier 1 drug might be a $10 co-pay, a Tier 2 might be $30, etc. There are now some plans that have up to six tiers.
• Copay vs. co-insurance. Sound confusing? It’s not. A copay is a set amount your insurance requires you to pay for a drug, regardless of its retail price. Co-insurance means you’re responsible for a percentage of the drug’s full price. More and more, plans are moving to co-insurance, which could mean significant increases for you.
• Prior authorization. Just because a drug is on formulary doesn’t mean your prescription is covered. Even when a drug is on formulary, some insurers require patients to also get approval for the drug before they’re allowed to fill their prescription. It often means getting a doctor to send in a prior authorization form—and there’s no guarantee they will approve it.
• Step therapy. To contain costs, insurers prefer that you use cheaper drugs before trying more expensive ones—and they often insist on it with step therapy. If a drug you prefer requires step therapy, you have to try another (typically cheaper) drug first and provide evidence that it didn’t work before your insurer will approve your preferred (typically more expensive) drug.
• Quantity limits: To ensure patient safety and keep costs low, most insurers will limit the amount of certain drugs you can purchase in a given time period. Quantity limits may be day-to-day, week-to-week or month-to-month and will differ between drugs. Drugs typically under quantity limit restrictions are those that are intended for short-term use, have serious side effects when overused or have high potential for abuse.

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