A formulary drug, which may be a brand name or a generic, is therapeutically similar to another drug, but not necessarily equivalent in its chemistry. Formularies are often referred to as therapeutic substitutions. Many experts argue that formulary drugs are often not interchangeable with the drug for which they are being substituted, and that formulary substitutions can be dangerous to patients. In essence, a drug formulary replaces the doctor s judgment in determining the proper prescription drug. Open Formulary Most common in non-HMO settings.
Patient incurs no financial penalty for using non-formulary drug.
Closed Formulary Non-formulary drugs are not covered in most instances. Most prevalent in HMO settings. Where formularies are used, they should be selected by an independent committee of physicians, including plan physicians, pharmacists and other clinical experts. Plans with formularies claim that drugs are rated on clinical effectiveness and cost. Drugs that are considered too costly or whose efficacy is considered less than acceptable are not included on the formulary list.