Not every drug is covered by every insurer. A formulary is the list of medications a health plan, hospital, or pharmacy benefit manager has approved for coverage. It is a practical document, shaped by cost, efficacy, and negotiation. Drugs on the formulary are covered, sometimes with a copay. Drugs off the formulary may not be covered at all, or may require prior authorization.

Formularies are tiered. Tier 1 usually includes generics with the lowest copay. Tier 2 includes preferred brand-name drugs. Tier 3 includes non-preferred brands with higher copays. Specialty drugs, often biologics, sit on a separate tier with the highest cost sharing. A pharmacy and therapeutics committee, made up of physicians and pharmacists, reviews the evidence and decides which drugs go on which tier. The committee meets regularly to add new drugs and reassess old ones. A drug's position can change if a cheaper alternative becomes available or if new safety data emerge.

What patients should know:

• Coverage varies. Each plan has its own formulary.
• Tiers matter. A drug on a higher tier costs more.
• Prior authorization. Some drugs require approval before coverage.
• Exceptions. Patients can request coverage for a non-formulary drug if medically necessary.

Formularies are one way insurers control costs. They are also a source of friction between patients, prescribers, and payers.