A formulary exception is a type of coverage determination request whereby a Medicare plan member asks the plan to cover a non-formulary drug or amend the plan's usage management restrictions that are placed on the drug (for example if the plan has a 30 pill per 30 day Quantity Limit, you might ask for a formulary exception of 60 pills per 30 days) or lower the cost-sharing for a formulary drug (for example, if your drug was a Tier 2 generic last year and now is listed on the formulary as a Tier 3 drug with higher cost-sharing, you can ask the plan to cover the drug at last-year's Tier 2 cost-sharing level.
All Medicare drug plans must have a timely and efficient process for making coverage determination decisions, including decisions on exception requests.
Our Q1Medicare.com website has an entire section dedicated to Formulary Exceptions (Coverage Determinations), Appeals & Grievances, but here are some highlights with links below.
The formulary exception process is a fast, straightforward way to make sure people with Medicare can get the drugs they need.
Through the formulary exception process, a Medicare Part D plan member may be able to:
- get a non-preferred drug at a better out-of-pocket cost,
- get a drug that isn't on the plan's formulary, or
- ask their plan not to apply a utilization management restriction (for example, prior authorization or step therapy).
When you or your doctor submit evidence to the plan in support of an exception request, the plan must notify you of its decision no later than 72 hours from the time it receives the supporting information from your doctor or 24 hours from the time it receives the supporting information from your doctor if your case is "expedited" due to an urgent health condition.
The most common situations in which Medicare plan members may request a formulary exception include:
- The member is using a drug on their plan's formulary that is removed during the plan year for reasons other than safety and there is no other drug on the plan's formulary that the member can use;
- The member's doctor prescribes a medically necessary drug that isn't on the plan's formulary;
- The member is using a drug that is moved, during the plan year, from the preferred to the non-preferred tier and the member can't use any other drugs on the preferred tier;
- The member's doctor prescribes a drug that is in the plan's more expensive cost-sharing tier because he/she believes the drug(s) in the less expensive cost-sharing tier is medically inappropriate for the member; or
- The member's doctor prescribes a drug on the plan's formulary that is subject to a utilization management tool (for example, a prior authorization or step therapy requirement) that he/she believes the member can't meet.
Generally, plans must approve exceptions when they find that the drug is medically necessary, consistent with the supporting information provided by the member's doctor.
For more information, you can learn more about formulary exception at the following links: