Health Insurance Blog

A health insurance plan may not cover prescription drugs that are not administered in a hospital or other facility. Health plans also do not generally cover vision exams, eyeglasses, and contact lenses. What supplemental coverages meet these needs?

Prescription Drug Insurance

Prescription drug insurance covers drugs and medicines prescribed by a physician. Most plans are offered through an employer on a group basis. There are two types of prescription drug plans: reimbursement and service.

• In reimbursement plans, the insured pays a pharmacist for prescribed drugs, the pharmacist completes a claim form, the insured submits the form to the insurer, and the insurer reimburses the insured. Reimbursement is based on usual and customary charges.

• In service plans, the insured obtains prescription drugs from a pharmacist who participates in the plan. The insured does not pay the pharmacist or pays only a copayment. The insurer then reimburses the pharmacist.

Service plans require extensive networks of participating pharmacies and involve a large number of small claims. Third-party administrators generally manage the plans for insurance companies because their high volume of business allows them to minimize administrative costs and negotiate discounts with participating pharmacies.

Service plans include mail-order prescription drug programs. These plans serve those who use maintenance medication and find it convenient to order 60- or 90-day supplies.

The benefits paid by prescription drug plans are generally subject to certain exclusions and limitations:

• Drugs that are dispensed while the individual is confined in a hospital or extended care facility are usually excluded, as they are normally covered by regular medical expense insurance.

• Prescriptions are usually limited to a specified number of days’ supply of a drug. The limit is typically a 30-day supply for drugs obtained from a regular pharmacy and a 90-day supply for drugs obtained from a mail-order pharmacy.

• Devices of any type, such as hypodermic needles or syringes, and bandages, are usually excluded.

• Contraceptive drugs or medicines are normally excluded, but may be covered at the policyholder’s request for an additional premium.

Vision Care Insurance

Vision care insurance provides benefits for routine preventive and corrective vision care. This coverage is usually offered on a group basis as a complement to other group coverages. Vision care insurance normally provides reimbursement for:

• Eye examinations (including refraction);

• Single vision, bifocal, and trifocal lenses;

• Contact lenses;

• Other aids for subnormal vision (such as lenticular lenses); and

• Frames

Under most vision care programs, the services covered require the authorization of an ophthalmologist or optometrist.

Vision care benefits are usually subject to limitations and exclusions:

• Policies often limit coverage to one examination and one pair of lenses in any 12 consecutive months and one pair of frames every two years.

• Expenses for frames are usually limited to a certain amount. This amount covers average frames; those who choose luxury frames must pay the added cost. Other nonessential items such as sunglasses, tinted lenses, and safety glasses are generally excluded, as is duplication needed because of breakage or loss.

• Medical or surgical treatment is commonly excluded, as this is covered by medical expense plans.