Key Takeaways

• Formularies change regularly because plans review new drug data, negotiate contracts, and update tier placements every year.

• Careful review during the Annual Enrollment Period helps you avoid unexpected drug costs and stay protected for the year ahead.

Why Formularies Shift Throughout The Year

Every year, Medicare plans make updates to the list of medications they cover. This list is known as the formulary, and it includes information about which drugs are covered, what tier each drug belongs to, and whether special rules apply. These changes affect your cost and access to medications when the new plan year begins on January 1.

Formularies change for several reasons. Plans evaluate new medical guidelines, look at the latest drug research, and adjust their lists based on safety or effectiveness updates. Plans also review contracts with drug manufacturers. These negotiations influence how much a plan pays for a drug, which eventually affects what you pay at the pharmacy. When these updates happen, the result is often a reshuffling of which drugs receive preferred pricing and which move to higher tiers.

You may notice that these changes tend to increase during the months leading up to the Annual Enrollment Period. This timing is not random. The period from October 15 to December 7 each year is when you can make changes to your plan for the upcoming year. Plans release updates before this window so you can compare options and decide whether adjustments to your current coverage may affect you.

What Drives These Constant Updates?

Several factors shape formulary changes across Medicare plans. Understanding these reasons helps you know what to expect each year.

How Do Clinical Guidelines Influence Updates?

Medical research evolves throughout the year. When health experts release new studies or update safety recommendations, plans adjust drug coverage to reflect the latest information. This keeps formularies aligned with current standards in patient care.

Why Do Drug Contracts Affect Your Costs?

Plans frequently negotiate with manufacturers to secure better pricing. These agreements determine how much the plan pays for a medication and influence tier placement. When negotiations shift, a drug may move to a different tier or require prior authorization.

How Does Generic Availability Change Formularies?

Whenever a brand-name drug loses its patent protection, a generic version may enter the market. Generics usually cost less, so plans often shift coverage toward these lower-cost alternatives. This can cause brand-name drugs to move to higher tiers.

Are Safety Concerns Part Of The Review?

Yes. If safety issues arise, plans may restrict or remove certain medications to better protect enrollees. This may happen at any point during the year.

How Do Utilization Patterns Shape Coverage?

Plans review prescription trends to see which drugs are used more frequently. High or low usage may trigger formulary changes to create a more balanced cost structure.

What Makes Formularies Unpredictable?

Even though plans follow a structured review process, the outcome can still feel unpredictable. You may not know which medications will change tiers or require new approvals until your Annual Notice of Change arrives in September. This notice outlines the changes that will take effect on January 1, giving you time to evaluate your options before AEP begins on October 15.

Some updates are also tied to regulatory requirements. When Medicare releases new rules or cost guidelines for the upcoming year, plans adjust their formularies to meet compliance standards. These updates happen on a yearly cycle and can influence drug costs and coverage rules.

5 Steps To Protect Yourself From Unexpected Drug Surprises

Your medication costs can rise unexpectedly if you do not stay updated on formulary changes. Here are five practical steps to help you avoid surprises.

1. Review Your Annual Notice Of Change Every September

Your ANOC arrives each year in September. It summarizes all the changes to your plan for the next year, including updates to drug tiers, prior authorization rules, and coverage limits. Reviewing this document carefully ensures you have enough time to respond before AEP ends on December 7.

2. Check Your Medication List Every AEP

During the Annual Enrollment Period from October 15 to December 7, review how your medications will be covered in the following year. Look at tier placements, coverage rules, and expected cost changes. If you see major shifts, consider whether another plan may better match your needs.

3. Monitor Mid-Year Changes

Although most major changes begin on January 1, plans may make adjustments during the year for safety or regulatory reasons. Checking for updates every few months helps you stay informed. Plans must notify you if a covered drug is removed or moved to a higher tier for safety purposes.

4. Ask About Coverage Rules

Prior authorization, step therapy, and quantity limits can affect your access to medications. If you notice new rules applied to your drugs, ask questions early. Understanding these restrictions helps you plan ahead and avoid denied prescriptions.

5. Contact A Licensed Agent For Guidance

Comparing plans on your own can feel overwhelming. A licensed agent listed on this website can help you review your medication list and identify plans that match your needs. Agents understand how formularies work and can guide you through cost and coverage questions.

Why Careful Monitoring Matters

When formularies shift, your out-of-pocket spending may change. Even small adjustments, such as moving a drug from one tier to another, can influence your monthly budget. By staying informed and reviewing your coverage each year, you reduce the chance of unexpected pharmacy costs.

This is especially important for individuals who take multiple medications or rely on ongoing treatments. Because tier changes directly affect copays and coinsurance, planning during AEP can help you stay in control of your healthcare spending.

Healthcare needs also change over time. A medication that worked well for you last year may not be the most effective option today. Regular review during AEP allows you to make adjustments that fit your current health needs while ensuring all your prescriptions remain covered.

Staying Informed Throughout The Year

To keep yourself protected, maintain an updated medication list and check your plan’s communication throughout the year. Plans send required notices when major updates occur, so reviewing these messages helps you respond quickly.

Using available tools can also make the process easier. Many online resources allow you to check drug costs, view tier changes, and evaluate your coverage in real time. These tools can be especially helpful as you prepare for AEP each fall.

Planning Ahead For 2026

As you prepare for the 2026 plan year, remember that the Annual Enrollment Period from October 15 to December 7 is your primary window to make changes. By reviewing your drug list, studying your ANOC, and comparing options, you can secure the coverage that best supports your health.

If your plan has made major changes to its formulary, explore alternative options early in the enrollment period. This gives you time to evaluate differences in cost-sharing, tier structures, and coverage rules.

Staying In Control Of Your Drug Coverage

Taking the time to understand why formularies change helps you stay prepared. By reviewing updates every year, watching for mid-year modifications, and comparing coverage during AEP, you can prevent surprises and keep your drug costs predictable.

If you would like help reviewing your options, reach out to any of the licensed agents listed on this website for guidance. Personalized advice can make your decisions clearer and ensure you stay protected for the upcoming year.