This content is for general informational purposes and does not constitute medical, legal, or financial advice. Healthcare rules and costs change annually. Last reviewed: January 1, 2025. Always verify current details with your insurer, employer, or a licensed healthcare navigator.
Formulary
Your insurance plan's list of covered prescription drugs, organized by cost tiers.
Full Definition
A formulary is the list of prescription drugs covered by your insurance plan. Drugs are grouped into tiers — typically Tier 1 (generic, lowest cost) through Tier 4 or 5 (specialty drugs, highest cost). Your cost-sharing depends on which tier a drug falls into. Plans may require prior authorization or step therapy (trying a cheaper drug first) for higher-tier medications.
Real-World Example
Your plan's formulary places generic atorvastatin on Tier 1 ($10 copay) and brand-name Lipitor on Tier 3 ($60 copay). Your doctor can prescribe the generic to save you money.
Related Terms
Was this helpful?