Formulary tier placement for commonly prescribed branded drugs: benchmarking and creation of a preferred placement index.

Objectives: To examine the relative preferred placement of commonly dispensed prescription drugs and to assess variations in drug coverage across a convenience sample of 12 health insurance plans.

Study Design: A cross-sectional analysis of the plans focused on all 67 patented brand-name prescription drugs from among the top 200 prescribed drugs in 2004.

Methods: For each plan, we created a preferred placement index representing the percentages of drugs that were positioned on the formulary with preferred placement, defined as tier 2 without restricted access. A separate cardiovascular index was also created. Sensitivity analyses determined the effect of limiting the sample to the top 25 patented branded drugs and examined the robustness of our index when prior authorization restrictions were allowed.

Results: Across 67 drugs and 12 insurance plans, drugs were rated as having preferred placement 59.1% of the time. The preferred placement index ranged from 31.3% to 88.1% across the plans for the full sample of 67 drugs; for the sample of cardiovascular drugs, the range was 25.0% to 100.0%. Results were robust across sensitivity analyses.

Conclusions: Based on this convenience sample of 12 formularies, there is a wide variation in preferred placement of the most commonly prescribed branded medicines across insurers. The wide range implies that the specific insurance coverage a patient selects may have an effect on whether his or her prescribed drugs have preferred formulary placement and on his or her out-of-pocket drug expenditures.