How the System Works
Generally, insurance companies use many tools to help manage the cost of medications and therapies for the beneficiaries (patients) that they cover. To contain costs, many insurance companies use various co-pay structures also known as tiered benefit designs where patients are required to pay more for some medications over others. Another practice, step therapy, requires patients to try one medication and fail on it before switching to another medication. Oftentimes a generic, and therefore less expensive drug, is used first before the insurance company will cover the cost for a more efficacious and more expensive drug. Unfortunately, many of the tools used by insurers to cut costs are not to the benefit of the patient and can directly conflict with physician treatment recommendations.