How to Check Formularies and Preferred Drug Lists Before Prescribing

Before you write a prescription, you need to know if the drug is covered - and how much the patient will pay. It’s not just about what’s clinically right. It’s about what’s covered, what requires prior authorization, and whether the patient can afford it. Skipping this step leads to delayed care, frustrated patients, and wasted time for everyone. In 2026, with over half of U.S. prescriptions going through formularies, checking the formulary isn’t optional - it’s part of standard care.

What Is a Formulary, Really?

A formulary, also called a Preferred Drug List (PDL), is a list of medications approved by a health plan for coverage. It’s not a random list. It’s built by teams of doctors and pharmacists who review clinical data, safety records, and real-world outcomes. Medicare Part D plans, for example, must cover at least two drugs in each therapeutic category. Medicaid plans vary by state, but most follow strict PDLs. Commercial insurers like UnitedHealthcare and Aetna design their own, often with fewer tiers than Medicare.

Formularies are updated constantly. Medicare plans must give 60 days’ notice before removing a drug or raising costs. Some insurers, like HealthPartners, update their lists every three months - in January, April, July, and October. That means a drug covered last month might need prior authorization next month. If you’re prescribing Januvia, you can’t assume it’s Tier 3 everywhere. One plan might list it as Tier 3, another as Tier 4, and a third might require step therapy first. You have to check each patient’s plan.

The Tier System: How Much Will the Patient Pay?

Most formularies use a tier system to control costs. The lower the tier, the less the patient pays. Here’s how it typically breaks down:

• Tier 1: Preferred generics - usually $1 to $5 per prescription.
• Tier 2: Non-preferred generics - $10 to $20.
• Tier 3: Preferred brand-name drugs - $30 to $50.
• Tier 4: Non-preferred brands - $60 to $100+.
• Tier 5: Specialty drugs - over $950/month, paid as a percentage (often 25-33%) of the total cost.

That’s a massive difference. A Tier 1 generic might cost a patient $5. The same drug on Tier 4 could cost $75. For a diabetic on metformin, that’s $900 a year. For a cancer patient on a Tier 5 drug, it could be $2,000 a month before the new $2,000 annual cap kicks in for Medicare in 2025. Knowing the tier isn’t just helpful - it’s life-changing for patients.

What Do the Codes Mean? PA, ST, QL

Every drug on a formulary has one or more codes that tell you what’s required before the pharmacy can fill it:

• PA (Prior Authorization): You must submit paperwork proving the patient meets clinical criteria before the plan will cover it.
• ST (Step Therapy): The patient must try and fail on a cheaper, preferred drug first. For example, you can’t prescribe a new biologic for rheumatoid arthritis until they’ve tried methotrexate.
• QL (Quantity Limit): The plan only covers a certain amount per month - say, 30 pills instead of 90. You need to request an override if more is needed.

These aren’t just paperwork hurdles. A 2024 AMA report found that 88% of physicians have seen delays in care because of prior authorization. In some cases, those delays led to serious health events. For cancer patients, 32% of PA requests take longer than 48 hours to process. That’s not bureaucracy - it’s risk.

How to Check a Formulary: 4 Practical Ways

You don’t need to memorize every formulary. But you do need a system. Here’s what works:

1. Use the insurer’s website. Every major plan - Aetna, UnitedHealthcare, Humana - has a drug search tool. You’ll need the patient’s plan name, county, and sometimes their member ID. Aetna’s tool, for example, shows tier level, PA requirements, and alternatives in real time. 74% of providers rate it "very helpful."
2. Check your EHR. If your clinic uses Epic, Cerner, or another major system, look for the "Formulary Check" module. Northwestern Medicine cut prescription abandonment by 42% after adding this feature in 2023. Epic’s new FormularyAI, launched in August 2024, predicts coverage likelihood with 87% accuracy based on 10 million past decisions.
3. Call the plan’s provider line. Nearly all Medicare Part D plans have 24/7 provider support. You can get real-time answers on coverage, PA status, or alternatives. No waiting. No forms.
4. Use CMS Plan Finder. For Medicare patients, this free tool covers 99.8% of Part D plans. Just enter the patient’s zip code and drugs. It shows cost, tier, and restrictions. Bookmark it. Use it every time.

Don’t rely on memory. Don’t ask the patient. Don’t guess. Every formulary is different. Even two plans from the same insurer can vary by state or employer group.

Medicare vs. Medicaid vs. Commercial: Key Differences

Not all formularies are created equal.

• Medicare Part D: Always five tiers. Must follow CMS rules. Must offer exceptions. Must notify patients 60 days before changes.
• Medicaid: State-run. Most states use closed formularies - meaning if a drug isn’t on the list, it’s not covered unless you get prior authorization. 42 states had closed PDLs as of January 2024.
• Commercial: Varies wildly. UnitedHealthcare uses four tiers. Some plans don’t have specialty tiers at all. Others have six. Some require step therapy for antidepressants. Others don’t.

That’s why you can’t use the same script for every patient. A drug that’s Tier 1 on one plan might be Tier 4 on another. A drug with no PA requirement on Medicaid might need three forms on Medicare. You have to check each one.

What’s Changing in 2025 and 2026?

The rules are shifting fast.

In 2025, Medicare’s out-of-pocket cap hits $2,000. That’s driving insurers to move more drugs to lower tiers. Over 70% of 2025 Medicare formularies are already adjusting to reduce patient costs. That means drugs that were Tier 4 last year might now be Tier 2.

By January 1, 2026, all Medicare Part D plans must use Real-Time Benefit Tools (RTBT) integrated into EHRs. That means when you type in a drug, the system will show you the patient’s exact cost and coverage status - right in your chart. No more switching tabs. No more guesswork.

AI tools are coming too. Epic’s FormularyAI is just the start. Soon, systems will predict not just coverage, but how likely a PA request is to be approved - based on the patient’s history, diagnosis, and even their pharmacy’s past success rate.

Common Mistakes and How to Avoid Them

Here’s what goes wrong - and how to fix it:

• Mistake: Assuming all plans treat the same drug the same way.
• Solution: Always check by patient, not by drug. Januvia isn’t one thing - it’s three different tiers across three plans.
• Mistake: Prescribing without checking PA requirements.
• Solution: If you see "PA" next to a drug, flag it. Add a note to your EHR: "PA needed - call plan tomorrow."
• Mistake: Ignoring mid-year changes.
• Solution: Bookmark your top 5 insurer formulary pages. Set a quarterly calendar reminder. CMS allows changes with 60 days’ notice - but many patients don’t get notified.
• Mistake: Waiting until the pharmacy calls to find out the drug isn’t covered.
• Solution: Make formulary checks part of your workflow - right after you decide on a drug, before you click "send."

Why This Matters Beyond Cost

This isn’t just about money. It’s about adherence. Dr. David Cutler from Harvard found that formularies using real-world data - not just clinical trials - improve medication adherence by 15-20%. Patients take their pills longer when they can afford them.

But there’s a dark side. Overly restrictive formularies delay care. A 2023 JAMA study showed that 32% of cancer PA requests take over 48 hours. That’s not just a delay - it’s a threat.

And it’s not just patients. A 2023 Sermo survey found that 68% of doctors spend 10 to 20 minutes per patient just checking coverage. Primary care docs spend nearly 19 minutes. That’s 100+ hours a year per provider - time that could be spent on diagnosis, counseling, or rest.

When you check the formulary, you’re not just saving money. You’re preventing delays, reducing stress, and making care more predictable. You’re doing your job better.

What to Do Next

Start tomorrow. Here’s your action plan:

1. Bookmark CMS Plan Finder and your top 3 insurer formulary pages.
2. Ask your EHR team if they have a formulary checker. If not, push for it.
3. Set a calendar reminder: check formulary updates every quarter.
4. When prescribing, always ask: "What tier? Any PA? Any step therapy?"
5. Teach your staff. One nurse checking coverage before you see the patient can save you 15 minutes.

Formularies aren’t going away. They’re getting smarter. The goal isn’t to fight them - it’s to master them. Because when you know what’s covered, you’re not just prescribing a drug. You’re prescribing access, dignity, and time.