Pharmacy
PHP wants members to get the most out of their healthcare insurance coverage. When understood and used effectively, the pharmacy benefit can save members money on the cost of prescriptions, maximizing the benefit.
The following information will help in understanding and selecting your pharmacy benefits. Should you have further questions, please call a PHP Customer Service Representative.
Pharmacy Programs
Employers have one of several possible pharmacy prescription programs: a two-tiered program, a three-tiered program, or a High Deductible Health Plan program with an HSA or HRA. Read below for more information about each option.
2-Tiered Pharmacy Program: Formulary vs. Non-Formulary
| Tier #1 | Tier #2 |
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Formulary - A list of medications that PHP doctors are encouraged to prescribe for covered members. Formulary Medications may be obtained at the regular formulary copayment.
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Non-Formulary - Covered drugs that are not included in the Formulary drug listing. PHP members have the option to obtain Non-Formulary medications with a higher pharmacy copayment.
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Example:
| If a doctor prescribes a: | Copayment is: |
| Formulary Drug* | $10 |
| Non-Formulary Drug* | $30 |
Please note that copayment amounts will vary depending on the benefit plan purchased.
*If a member or a doctor want a brand name drug when there is a generic drug available, a member may pay more than the Formulary or Non-Formulary copayments.
3-Tiered Pharmacy Program: Generic vs. Brand Formulary vs. Brand Non-Formulary
| Tier #1 | Tier #2 | Tier #3 |
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Generic - Covered drugs that are no longer protected by a drug company patent allowing other drug companies to manufacture equivalent versions of the same drug at a reduced cost. Generic medications may be purchased with the lowest copayment.
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Formulary - A list of brand name medications that PHP doctors are encouraged to prescribe for covered members. Formulary Medications may be obtained at a slightly higher copayment than the generic medications.
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Non-Formulary - Covered drugs that are not included in the Formulary drug listing. PHP members have the option to obtain Non-Formulary brand name medications but at the highest level of pharmacy copayment.
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| If a doctor prescribes a: | Copayment is: |
| Generic Drug | $10 |
| Brand Formulary Drug* | $30 |
| Brand Non-Formulary Drug* | $60 |
Please note that copayment amounts will vary depending on the benefit plan purchased.
*If a member or a doctor want a brand name drug when there is a generic drug available, a member may pay more than the Formulary or Non-Formulary copayments.
High Deductible Health Plan (HDHP)
An HDHP is a health insurance plan designed to save on insurance premium costs, with a minimum deductible of $1,200 (self-only coverage) or $2,400 (family coverage). The annual out-of-pocket, including deductibles and co-insurance, does not exceed $5,000 (self-only coverage) or $10,000 (family coverage).
In HDHPs, the pharmacy costs are included in the annual deductible and out-of-pocket costs. Eventhough members are responsible for the entire cost of the prescription until the deductible is met, they still receive the PHP network discount by using the PHP Rx card. Once the deductible is met, prescription costs would be covered at the plan's co-insurance level. Flat dollar prescription copays would not apply to these plans.
Members may also have one of the following products that would provide reimbursement for qualified out-of-pocket pharmacy expenses:
Health Savings Account (HSA) - An HSA allows employees to pay for current healthcare expenses (such as eligible prescriptions outlined by the plan) and save for future qualified medical and retiree healthcare expenses on a tax-free basis. An individual must be covered by a high deductible health plan to be eligible for an HSA.
Health Reimbursement Arrangement (HRA) - An HRA may be offered by an employer to help with the cost of medical needs. An HRA allows an employer to reimburse a specified amount for the qualified medical expenses (such as eligible prescriptions outlined by the plan) incurred by employees and dependents. It works in conjunction with a health plan to offset deductibles with reimbursements an employer makes. With an HRA, an employee benefits from health insurance protection, plus extra dollars received from an employer to help manage healthcare expenses.
Brand vs. Generic
Most prescription drugs have two names. One is the brand name that is used for advertising and marketing; the other is the generic name, which usually identifies the chemical ingredients of that medication.
Although a prescription drug may have a generic name, that does not necessarily mean that a generic drug is available. New drugs are patent-protected for twenty years after they are discovered. During this time, no generic may be sold for the drug. After the patent expires, however, the FDA allows other companies to manufacture equivalent versions of the drug, which are then sold at a discounted price (sometimes 30% or even 50% less than the original brand name drug).
In order for the generic drug to pass FDA standards, it must supply the same amount of active ingredient absorbed at the same rate as the original drug. It must also be of the same strength, have the same effect, and be of the same dosage form.
There can be a few minor differences between a generic and a brand name drug. These include colorings, fillers, and flavors. These are the aspects that could cause a subtle difference in how the patient experiences the drug.
Although the difference is usually slight, it is important to ask a doctor the difference between the brand name and generic for what he/she intends to prescribe. However, rest assured that the FDA requires generic drugs to perform in the same way as their brand name counterparts, and all pharmaceuticals available in the United States undergo very strict review.
What if a brand name prescription is prescribed and only the generic is covered? If a generic medication is required instead of a brand name medication, the pharmacy will only dispense the generic medication if signed "may substitute" by the doctor on the prescription. If a brand name medication is prescribed and the prescription is signed "dispense as written" the pharmacist cannot legally change the doctor's orders and a member will be charged the prescription co-pay, plus the cost difference between the generic and brand name medication.
What is Step Therapy? Step Therapy is that some drugs require the use of an appropriate alternative therapy within a specified number of days before they can be covered by the plan.
What is a Specialty Drug? Specialty drugs are generally injectable, high cost medications that have special handling requirements or require special training before use.
Is a mail order program available?
Yes, a Mail Order Program is available. Call PHP Customer Service for more details.