What is a formulary?

A formulary is a list of medications that an insurance plan or provider agrees to pay for. In California, health insurance plans are regulated by the Department of Managed Health Care and the Department of Insurance. Formularies are typically determined by health insurance companies or providers with input from doctors, pharmacists, and other medical experts. Formularies determine which drugs are covered and which are not. They also include information about how the drugs should be taken and any special instructions for patients. Generally, formularies are designed to ensure that the cost of prescription drugs is kept as low as possible in order to make drug coverage affordable for policyholders. Formularies also ensure that patients are getting the best treatments for their conditions by covering drugs that offer the most effective treatments. In addition, formularies can help prevent overuse of certain drugs and duplication of treatments that could lead to higher health care costs. By providing lists of approved medications and treatments, formularies help to ensure that health care costs remain reasonable.

Related FAQs

What is a provider network?
What types of health insurance are available?
What is a health insurance subsidy?
What is co-insurance?
What is a network provider?
What is an out-of-pocket maximum?
What is a coinsurance clause?
What is a coinsurance cap?
What is a coinsurance penalty?
What is a self-funded plan?

What is a formulary?

Related FAQs

Related Blog Posts