If your health plan covers medications, it is possible your prescription expenses go toward a general deductible. If your plan has a separate deductible for prescriptions, these expenses will count toward this instead and will not affect your medical costs deductible.
Some insurance plans involve a deductible for all medical costs. A deductible refers to the amount of money you have to pay out-of-pocket before your insurance plan starts to cover medical expenses.
Some health insurance plans have one deductible for medical costs — such as lab tests or specialist visits — and a separate deductible for medication costs. It is also possible to have a combined deductible for general and pharmaceutical costs that includes all medical expenses.
When you pay for your prescriptions in full, this spending will count toward your overall deductible if the medications are covered under your plan and you do not have a separate deductible for medications.
What are deductibles?
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If your health insurance plan has a deductible for medications only, it means you have to pay for your covered medications in full until you reach the total amount of your deductible. After that, your insurance will cover all or part of the medication costs.
For example, if your prescription medication deductible is $100, you have to pay for your covered medications until you have spent $100. After that, your plan will cover some or all of the cost of your prescriptions, and you may be responsible for a low copayment only.
If your insurance plan has only one deductible for all medical expenses, including medications, you have to pay for covered medications as long as you have not yet reached your deductible amount.
The amount of your deductible may vary depending on the insurance company and your specific plan. Typically a plan with a higher monthly premium will have a lower deductible and vice versa. Some insurance plans have no deductible at all.
If your prescribed medication isn’t covered by your health insurance plan, you will have to pay its full cost, even if you have reached your deductible amount.
If you need help covering the cost of medications, the free Optum Perks Discount Card could help you save up to 80% on prescription drugs. Follow the links on drug names for savings on that medication, or search for a specific drug here.
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You can find out whether you have a combined or a separate deductible for prescriptions by asking your health insurance agent or checking your summary of benefits and coverage. This is a document provided by the insurance company when you enroll.
If you have regular health insurance, you may be able to add a Medicare Part D extension to your plan. Medicare Part D plans exclusively cover prescription drug costs. Deductibles cannot be higher than $505.
In some situations, your insurance company may cover medications in full even before you have reached your deductible. This may be the case if the medication falls under a certain tier or is exempt from the deductible under the terms of your plan. You may ask your insurance company for a list of medications not subject to the deductible under your plan.
Other medications may also be excluded from the deductible if they are considered preventive treatments. You may check with your insurance company if your plan includes a list of preventive services.
Medications often considered preventive may include:
aspirin for adults ages 40–59 who have high cardiovascular risk
some vaccines
cholesterol medications for adults ages 40–75 who have a high risk of heart attack or stroke
Do prescriptions count toward out-of-pocket maximums?
If your insurance plan includes prescription drug coverage, the money you pay toward your deductibles, copays, and coinsurance counts toward your annual out-of-pocket maximum.
The out-of-pocket maximum is the most you will pay for medications, medical services, or any other benefits covered under your plan every year. Once you have reached your limit of out-of-pocket charges, your plan should cover 100% of the costs, including copays.
Charges that do not count toward your out-of-pocket limit include:
plan premiums (what you pay each month toward health insurance)
out-of-network services and care (going to providers who aren’t part of your insurance network)
medications or services your plan doesn’t cover
any costs above the allowed amount under your plan
In 2024, the out-of-pocket limit for a health insurance plan is $9,450 for an individual and $18,900 for a family. However, your insurance plan may have a lower out-of-pocket limit.
Usually, a copay doesn’t count toward your deductible. But it depends on your plan. Some insurance companies may apply copays to the deductible.
A copay is a fixed amount you pay for medications or healthcare services, such as $20 per prescription or $60 for a visit to a specialist doctor.
A copay is different from coinsurance. Coinsurance is the percentage of the cost that you pay for a prescription or service once you have met your deductible.
If your plan covers 80% of the cost of prescription medications, your coinsurance would be 20%. For example, $20 on a $100 prescription or $40 on a $200 prescription.
How can you save on prescription costs?
If your health insurance doesn’t cover a medication you need or if you have a deductible but can’t afford the full price of a drug, you have a few options to help you save on prescription costs:
Generic medications: You may ask your healthcare professional whether there’s a generic version of your prescription. Generic medications are typically more affordable than brand names. They are also more likely to be covered by insurance.
Alternative medications: You may also ask whether there are other medications that have the same effects as the one they prescribed to you. Often, you can find different medication names under a drug class. A drug class is a group of medications that have the same effects on your body, so you may be able to take them for the same condition. Only a healthcare professional can advise you whether this is the case for you, though.
Manufacturer coupons, copays, or patient assistance programs: Makers of medications may have discount programs to help cover the cost of their products.
Prescription discount cards: Prescription discount cards work with a network of participating pharmacies. They negotiate savings on prescriptions and then pass these savings on to you. You can sign up for free and show the discount card at the pharmacy when you need to get your prescription. Prescription discount cards may help you save up to 80% on the cost of your prescriptions.
Drug coupons: You may also show a prescription coupon at your pharmacy and get a discount on that specific medication. You can use the same coupon multiple times as long as it’s for the same medication. If you need to purchase a different drug, you will need to find a coupon for that medication specifically.
Summary
Most health insurance plans have either a combined deductible for all medical expenses or one deductible for general expenses and a different one for prescription medications. You will have to pay the full cost of your prescriptions until you meet your deductible.
Prescriptions typically count toward the deductible as long as they are covered under your plan. Your copay for a prescription may count toward the deductible, depending on your plan.
Your health insurance agent can help you determine what type of deductible you have and which prescriptions your plan might cover.
