Are you overpaying for your medication?

Plain-English glossary

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Biosimilar

A lower-cost version of a biologic drug (one made from living cells, like Humira). The FDA requires it to work the same way, with no meaningful difference in safety or effect.

Brand-name drug

The original version of a drug, sold under the maker’s trademarked name.

Charity foundation

A nonprofit that helps pay copays, premiums or deductibles for people with specific conditions. One of the few kinds of copay help Medicare members can use.

Coinsurance

Your share of a drug’s cost as a percentage, such as 25%. Unlike a copay, it goes up when the drug’s price goes up.

Copay

A fixed amount you pay for a prescription, such as $20, after your plan pays its share.

Copay card

A card from a drugmaker that pays part of your copay for its brand drug. Works only with private insurance, not Medicare or Medicaid.

Coverage gap (donut hole)

A phase of Medicare drug coverage where people used to pay more. It ended in 2025 and no longer exists.

Deductible

What you pay for prescriptions each year before your plan starts sharing the cost.

Discount card

A free card, like GoodRx, that gets you a lower cash price at the pharmacy. It isn’t insurance, and the purchase usually doesn’t count toward your deductible.

Extra Help

A Medicare program, also called the Low-Income Subsidy, that pays drug plan premiums and deductibles and caps copays for people with limited income and savings.

Formulary

Your plan’s list of covered drugs. Also called a drug list.

Formulary exception

A request asking your plan to cover a drug that isn’t on its drug list, or to charge a lower tier. Your doctor usually has to support it.

Generic drug

A copy of a brand drug with the same active ingredient, strength and effect. Usually much cheaper.

Medicare Part D

Medicare’s prescription drug coverage, offered through private plans.

Out-of-pocket maximum

The most you’ll pay in a year for covered care or drugs. For Medicare Part D drugs it’s $2,100 in 2026.

Patient assistance program

A drugmaker program that gives medication free or at low cost to people who meet income limits. Also called a free-drug program.

Prior authorization

Approval your plan requires before it will cover certain drugs. Your doctor requests it.

Specialty drug

A high-cost drug, often for complex conditions, that may need special handling or a specialty pharmacy.

Step therapy

A plan rule that you try a cheaper drug first before it covers a more expensive one.

Tier

The cost level a drug sits at on your plan’s drug list. Lower tiers cost you less.