What are "tiers or categories" on a Medicare drug plan's drug list (formulary)?
Many Medicare drug plans place drugs into different "tiers." Drugs in each tier have a different cost. Some plans may have more tiers and some may have fewer. Here is an example:| Tier | You Pay | What is Covered | Cost Example* |
| 1 | Lowest copay |
Most generic prescription drugs | $5.00 |
| 2 | Medium copay |
Preferred brand-name prescription drugs | $28.00 |
| 3 | Higher copay |
Non-preferred brand-name prescription drugs | $53.00 |
| Specialty Tier |
Higher percentage |
Unique, very high-cost drugs | 25%-33% of drug cost |
* These amounts aren't actual costs. They are examples of Copayment or Coinsurance costs for a 30-day supply. Costs vary by plan and by drug.
(Primary Source: Centers for Medicare and Medicaid Services - Medicare and You Handbook. This content may have been enhanced by this site to include further examples, explanations, and links.)