Can Your Insurance Force You to Use Mail Order in New Jersey?

The insurance industry is regulated at the state level. Each state's insurance commissioner's office creates, maintains and enforces legislation regarding insurance business and those who conduct it. With regard to prescription coverage and the purchase of medications, the New Jersey Department of Banking and Insurance has not granted carriers authority to force or compel covered members to utilize mail order prescription services.

Insurance Prescription Benefits

• The majority of health insurance plans sold in New Jersey utilize three-tier prescription benefits cards. The first tier carries the lowest out-of-pocket cost for medications and applies only to generic drugs. The second tier carries a higher co-pay and applies only to ordinary brand-name drugs. The third tier carries the highest expense and applies only to non-formulary medications, which are typically newer or less-popular prescriptions. Non-formulary lists evolve regularly as insurance companies further their own negotiations and arrangements with drug manufacturers.

Mail Order Services

• Nearly every health insurance company in New Jersey provides customers with access to an independent third-party medication distributor. Members required to take recurring maintenance drugs may have the option of enrolling in an automatic refill and delivery program sponsored by each insurance company and facilitated by a third party. The goal of such a mail order service is to provide necessary medications at prices below those charged at retail pharmacies and give consumers the added convenience of automatic delivery.

Co-Pays

• Most mail order pharmacy services charge members co-pays that are less than their ordinary fees for 30-day supplies of medications. Mail order companies typically provide patients with 90-day quantities of prescriptions but charge fees equal to one-and-a-half or two times the ordinary monthly co-pay. This essentially allows patients to pay for 45 or 60 days worth of medication and still receive a 90 day supply.

Limitations

• Unfortunately, not all prescriptions are eligible for mail order services. Most notably are medications that are narcotic in nature. Even patients with regular recurring prescriptions for pain pills or other opiate derivatives will likely still be required to visit a local pharmacy. Restrictions on sending narcotics through the mail is another reason health insurance companies cannot force members to use mail order services.