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Some Medicare Part D prescription plans have restrictions on coverage for certain medications, even if they’re on the plan’s list of covered drugs, which is called a formulary.
The three most common restrictions:
- Prior authorization
- Step therapy
- Quantity limits
Part D plans set these restrictions, not Medicare, and they vary from plan to plan. You may need to get special permission before your plan will cover the drug or dosage prescribed.
What is prior authorization in a Medicare Part D plan?
Prior authorization means that you or your doctor must contact the plan and get permission before you can fill certain, generally expensive, prescriptions. Your physician must verify that the drug is medically necessary for your specific situation. In some cases, a plan may require prior authorization because a powerful drug poses safety concerns if taken inappropriately, used for too long or prescribed for a medical condition other than its original purpose.
Medicare Advantage also uses it. Part D, which you buy from a private insurer that Medicare regulates, isn’t the only part of Medicare that may require prior authorization. Most Medicare Advantage plans, also offered by private insurance companies with Medicare approval, require prior authorization for some prescriptions you take and drugs administered in your doctor’s office.
The key question that insurance company officials want answered is: Why was this particular drug prescribed and not an alternative that might be less expensive or considered safer?
A plan may also require prior authorization if the drug could be covered under Medicare Part A, Part B or Part D and the plan wants to know more about the circumstances under which it was prescribed. Part D usually covers a drug you take in your own home. Medicare Part B usually covers treatment in a doctor’s office, and Medicare Part A or Part B may cover drug therapy in a hospital.
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