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Formulary

A catalog of prescription medications included in your health insurance coverage. Formularies often categorize drugs into different tiers with varying cost-sharing.

Detailed Explanation

Insurance companies create formularies to help manage prescription drug costs. The tier a drug is in will determine how much you pay out-of-pocket.

Practical Example

When John's doctor prescribed him a new medication, he checked his insurance plan's formulary to see if it was covered and what his co-pay would be based on its tier.

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