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Drug Tiers Explained

Individuals and Family PlansAll About Health InsuranceDrug Tiers Explained


Drug Tier Plans

Drug Tier Definitions for Individual and Family Plans 

Tier 1 (Preferred Generic Medications)

  • Generic drugs
  • Lowest cost option

Tier 2 (Preferred Brand Medications)

  • Preferred brand-name products based on safety, efficacy, and cost
  • Second lowest cost option

Tier 3 (Non-Preferred Brand and Generic Medications)

  • Brand name and generic drugs for which alternatives are available in Tier 1 or Tier 2
  • Not used typically as a first-line of treatment
  • Higher copayment or coinsurance option

Tier 4 (Specialty Medications)

  • Medications which are more expensive than most medications and may be used to treat rare and complex conditions

Tier 5 (Zero Cost Share Preventive Drugs)

  • Specific preventive medications with no patient cost-share

Note: The above tier definitions refer to a Closed Formulary plan. Open Formulary plans include some of the tiers described above as well as include a Non-Formulary tier. The definition for a Non-Formulary tier is noted below:


  • Drugs that have not been reviewed by the Pharmacy & Therapeutics Committee or have been reviewed and designed as "non-formulary"
  • Highest coinsurance option