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Prescription drug benefits come in the form of copays and/or discounts.
Prescription copays may have two, three, and four-tiers.

  • Tier 1 – generics
  • Tier 2 – brand name
  • Tier 3 – expensive brand name
  • Tier 4 – non-formulary and really expensive medications

It’s an industry standard to have a zero deductible on generics and a $200 to $1,000 annual deductible on brand-name prescriptions per person.

Keep in mind, a prescription for a pre-existing condition may be covered or may have an exclusion rider. If excluded a discount benefit may be more advantagous.

Many companies offer mail order service for their prescriptions and generally offer more savings plus the added convenience of home delivery.

Brand vs Generics


What is a “Generic” medication/drug?

The generic drugs are carefully regulated medications that have the same medicinal ingredients as the original brand name drug, but which are generally cheaper in price. Nearly 1 in 3 drugs dispensed are generic. They undergo comparative testing to ensure that they are equal to their “brand” counterparts in:

  • Active Ingredient (e.g. “Pravastatin” is the active ingredient in brand • name Pravachol)
  • Dosage (e.g. 10 mg of the active ingredient)
  • Safety (e.g. same or similar side effects, drug interactions)
  • Strength
  • Quality
  • Performance (e.g. 10 mg of a “generic” can be substituted for the “brand” and have the same therapeutic result)
  • Intended use (e.g. both “generic” and “brand” would be prescribed for the same conditions)

What this means is that “generic” medications can be used as a substitute of their brand equivalents with the same therapeutic results. There are a few exceptions and as always you should consult your physician before switching from a brand name medications to a
generic or vice versa.


What differences are there between generic and brand?

While generics and brand equivalent drugs contain the same active ingredients, they may be different in the following ways:

  • Color
  • Shape
  • Size
  • Cost
  • Appearance (e.g. the scoring or markings)

The color, shape and size of the medication come from the fillers that are added to the active ingredients to make the drug. These fillers that are added to the drug have no medical use and are regulated so they do not change the effectiveness of the final product. A generic drug must contain the same active ingredients and must be equivalent in strength and dosage to the original brand name equivalent. Generic drugs can be more cost effective than purchasing the brand name.


Why do generics cost less than the brand name equivalents?

When a new drug is “invented”, the company that discovered it has a patent on it that gives them the exclusive production rights for this medication. Once the patent expires other companies can bring the product to market under their own name. This patent prevents other companies from copying the drug during that time so they can earn back their Research and Development costs through being the exclusive supplier of the product. After the patent expires however, other companies can develop a generic version of the product. These versions generally are offered at much lower prices because the companies do not have the same development costs as the original company who developed the medication.

The main thing to realize here though is that the two products are therapeutically equivalent. They may look different, and be called something different, but they are required to be chemically equivalent.


How are Generic drugs tested to ensure quality and efficacy?

The two most generally accepted methods to prove the safety of a generic version of a drug are to either repeat most of the chemistry, animal and human studies originally done, or to show that the drug performs comparably with the original brand name drug. This second option is called a “comparative bioavailability” study. During this type of study, volunteers are given the original drug, and then separately later the generic drug. The rates at which the drug is delivered to the patient (into their blood stream or otherwise absorbed) are measured to ensure they are the same. Because the same active ingredient is used the major concern is just that it delivers the common chemical(s) at the same rate so that they have the same effect.


A reason why a doctor may prescribe a brand name instead of a generic

Refer to The New York Times article “Crackdown on Doctors Who Take Kickbacks“.

Rx: A medical prescription. The symbol “Rx” is usually said to stand for the Latin word “recipe” meaning “to take.” It is customarily part of the superscription (heading) of a prescription.