Your Benefits Explained: Understanding Your Prescription Drug Formulary
Welcome to our new series where each month, our benefits experts will take a deeper dive into common questions -- and how applying your knowledge can go a long way in managing your health care. This month we are featuring Prescription Drug Formularies.
Understanding Your Prescription Drug Formulary
When you fill a prescription, you may notice that some medications cost less than others or that certain drugs require extra steps before they’re covered. These differences are guided by something called a formulary.
Formularies are developed and maintained by the plan’s pharmacy benefit manager (PBM). For Northwestern’s faculty and staff plans, the PBM is CVS Caremark. The medical plans are administered by UnitedHealthcare, which does not manage or administer the prescription drug plan or set the formulary – this is the responsibility of the PBM. Here’s a straightforward look at what a formulary is, how it’s developed, and how you can use it to make informed decisions about your medications.
What Is a Formulary?
A formulary is a list of prescription medications that your health plan covers. It includes brand‑name and generic drugs and organizes them into cost tiers. These tiers help determine how much you pay out of pocket.
A formulary is designed to:
- Support safe, effective, evidence‑based treatment
- Help manage overall plan costs for members
While a formulary includes many commonly prescribed medications, not every drug on the market will appear on the list. The formulary includes medications to treat conditions within major disease categories.
How is a Formulary Created?
CVS Caremark’s formulary is developed and maintained by their pharmacy and therapeutics committee consisting of 18 external physicians and four pharmacists who serve independently to develop and govern CVS Caremark formularies, ensuring that decisions are evidence-based, clinically appropriate, and free from manufacturer influence.
When is the Formulary Updated?
Formularies may be updated throughout the year to reflect new medications, new clinical evidence, or changes in pricing. For the most up‑to‑date information on your prescriptions, use the online formulary tool in the CVS Caremark online portal or the mobile app. A PDF version of the formulary is also posted on the Northwestern Prescription Drug Plan website and updated quarterly.
How to Use the Formulary
Understanding how to navigate the formulary can help you avoid surprises and make the most of your benefits. Here are the most helpful ways to use it:
- Search for your medication online.
Use the online formulary tool in the CVS Caremark online portal or the mobile app to look up your prescription, see whether it’s covered, and understand its tier or cost level. - Check for covered alternatives.
If a medication isn’t on the formulary or has a higher cost, the tool will often show lower‑cost or preferred alternatives that treat the same condition. - Review requirements such as prior authorization.
Some medications require your provider to submit additional information before they’re covered or in some cases you may be asked to try a preferred medication first. The formulary tool will indicate these requirements. - Use it when discussing treatment options with your provider.
Bringing formulary information to your appointment can help you and your provider choose a medication that meets your clinical needs and minimizes your out‑of‑pocket costs.
Other Programs and Coverage Rules
In addition to the formulary, there are other programs and coverage rules that are important for you to understand.
- Generics preferred: If a generic is available, it will be the preferred drug. If you choose to use a brand-name drug rather than an available chemically equivalent generic drug, a charge is applied in addition to the amount of your coinsurance or copay.
- CVS Retail 90: Maintenance medications, such as those used to treat high blood pressure, heart disease, asthma, and diabetes must be filled with a 90-day supply at CVS, Walgreens, or CVS Mail Order.
- Specialty drugs: Specialty drugs can only be filled through CVS Specialty Pharmacy. Specialty drugs, which are used to treat complex, chronic, or rare conditions, must be filled through CVS Specialty Pharmacy. Specialty drugs can be identified using the formulary tool in the CVS Caremark online portal or the mobile app and posted on the website which is updated quarterly.
- PrudentRx: Select specialty drugs are provided at $0 cost to those in the PPO or HMO medical plans who enroll in the PrudentRx program. Those who do not enroll in the program will pay a higher amount for these select specialty drugs. You can review a list of drugs included in the PrudentRx program on the website.
Why It Matters
A formulary is more than a list—it’s a resource that helps you understand your coverage, anticipate costs, and work with your provider to choose medications that are effective and affordable. By using the online tools available through your prescription drug plan, you can feel confident navigating your options and making informed decisions about your health.