Explanation of Benefits, Section 4

If you have filled prescription drugs using Medicare’s Part D plan, the United States government will send you a form titled Explanation of Benefits. While there is no action required on your part upon receipt of this form, it is worth your time to read and understand it. It tracks your Medicare benefits and will alert you to any mistakes made by your pharmacy or Medicare itself which could cost you additional money.

The Explanation of Benefits form is divided into six sections. This article will examine section four. Section four lists updates to your drug plan’s formulary that will affect the drugs you’re able to obtain and use. Section four of your EOB form will only include updates that affect specific drug that you are taking. General changes in your Part D formulary are listed in the Annual Notice of Change document and will not normally be listed in the Explanation of Benefits document unless they directly affect you.

Section four exists to assist you and your doctor in making the necessary adjustments to your drug purchasing routine. Possible formulary changes include:

  • the addition of new drugs
  • the removal of existing drugs
  • the addition or removal of coverage restrictions for drugs
  • moving a drug from one cost-sharing tier to a new cost-sharing tier
  • brand name drugs being replaced by generic drugs
  • prior authorization changes
  • cost-sharing tier increases

In most cases, once you have received the Explanation of Benefits form that explains formulary changes, you will have 60 days before the changes take effect. Exceptions to the 60-day rule are sometimes made in the interests of safety, for example if a crucial drug is taken off the market.

Detailed description of formulary changes

Section four of your Explanation of Benefits form will provide a detailed description of formulary changes that alter your coverage or dosages. This section may include subsections on step therapy changes. This will instruct you to try an alternative drug, or multiple alternative drugs in a certain order, if your drug of choice becomes unavailable or moved to a different tier. Section four will also inform you of any quantity limits changes. For example, a drug you have previously used may be changed to feature a quantity limit. This means that you are restricted in terms of how much you may order. The date and exact nature of the change will be specified in section four.

Section four will specify any or all of these changes as they apply to your particular case. It also includes a sub-section titled “what you and your doctor can do” which offers recommendations for you and your physician when it comes to obtaining alternative drugs or dosages.

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