Broker Check


| February 27, 2023

      Medical insurance can be very confusing. In-network vs. out of network, copay and coinsurance, the last thing you’re going to understand when you look at your group health insurance quote for the first time is 10G/15PB/50NPB/200S. It looks like an unsolvable math problem or some type of computer code when in all actuality those numbers and letters are showing you the costs of prescriptions while using that health plan. But what do those letters mean? 

      G stands for generic. These are going to be your lowest cost prescription drugs. Generic drugs are an exact replica of a brand name drug, that has been authorized by the patent holder. According to the FDA, in the United States, 9 out of 10 prescriptions filled ae for generic drugs. It’s said that the availability of generic drugs helps to keep prescriptions drug costs down because an increase in availability can create competition.  

      Preferred brand drugs or brand name drugs are prescription drugs that don’t have generic equivalent. They are reviewed for cost effectiveness and clinical efficiency. You may be charged a penalty if you use a preferred brand when a generic equivalent is available.  

      Non-preferred brands have an alternate substitute available that is usually cheaper and equivalent. You may also be charged a penalty if you use a non-preferred drug when a generic drug is available.  

      Specialty drugs are non-diabetic injectable medication, a medication that requires special handling, special administration or monitoring, or a high-cost oral medication. These medications are used to treat rare and complex sicknesses or diseases. 

      You may be thinking, “why are there so many different costs?”, well that’s because the drug tiers are a way for the insurance companies to determine medical costs. Typically, the wait works is the higher the tier, the higher the price.  

      The costs for you prescription drugs will either be copays or coinsurance. Copays are stated amounts like $10, $15, or $30. Coinsurance is a stated percentage 50%, 80%, 90%. When looking at coinsurance, the insurance company is always responsible for the larger number. So, if the coinsurance was 90% you would owe the remaining 10%. 

      If your prescription drug isn’t on the formulary, it may not be covered. In situations like these it’s best to call your agent or the insurance company and find out your options. You may qualify for special discounts, or you may be able to use programs like GoodRX.