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What Is Prior Authorization, Step Therapy, and Quantity Limit?

Prior authorization

Some Medicare Prescription Drug Plans may require prior authorization for Medicare coverage for certain medications. This means that before the Medicare Prescription Drug Plan will cover a particular drug, your doctor, or your prescriber must first show that you have a medically necessary need for that particular drug and/or have met the prior authorization requirements for the drug. Plans may require prior authorization to be sure that drugs are prescribed and used correctly.

Step therapy

Step therapy is a type of prior authorization. In most cases, you must first try a less expensive drug on the Medicare Prescription Drug Plan’s formulary (also called a drug list) that has been proven effective for most people with your condition before you can move up a “step” to a more expensive drug. This might mean trying a similar, more affordable generic drug instead of a more expensive, brand-name medication. The more affordable drugs in the first phase are known as “Step 1” prescription drugs. Please note that the formulary may change at any time. You will receive notice when necessary.

However, if you have already tried the more affordable drug and it didn’t work or if your prescriber believes that it is medically necessary for you to be on a more expensive drug, he or she can contact the plan to request an exception. If your prescriber’s request is approved, the plan will cover the more expensive drug. The more expensive drugs are known as “Step 2” prescription drugs, and Medicare will not cover them until Step 1 drugs are first tried unless an exception is obtained.

Quantity limit

For safety and cost reasons, plans may set quantity limits on the amount of drugs they cover over a certain period of time. For example, a person may be prescribed a medication to take two tablets per day, or 60 tablets per month. If the plan has a quantity limit of 30 tablets per month for that medication, your doctor or prescriber will need to work with the Medicare Prescription Drug Plan to get authorization for a higher quantity.

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