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MP 5.01.96 Therapeutically Equivalent Generic Override

Medical Policy

Prescription Drug

Original Policy Date

Last Review Status/Date

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Our medical policies are designed for informational purposes only and are not an authorization, or an explanation of benefits, or a contract.  Receipt of benefits is subject to satisfaction of all terms and conditions of the coverage.  Medical technology is constantly changing, and we reserve the right to review and update our policies periodically.


According to the U.S. Food and Drug Administration (FDA), a generic drug is identical, or bioequivalent to a brand-name drug in dosage/form, safety, strength, how it is taken, quality, performance and intended use. New drugs, like other new products, are developed under patent protection. The patent protects the investment in the drugs development by giving the company the sole right to sell the drug while the patent is in effect. When patents or other periods of exclusivity expire, manufacturers can apply to the FDA to sell generic versions. Health professionals and consumers can be assured that the FDA approved generic drugs have met the same rigid standards as the innovator drug.  Although generic drugs are chemically identical to their branded counterparts, they are typically sold at substantial discounts from the branded price.  This is because the generic manufacturers don't have to repeat costly research on ingredients or dosage forms already approved for safety and effectiveness.  
Our Pharmacy and Therapeutics (P&T) Committee comprised of practicing board certified physicians and licensed pharmacists through the state of Idaho, made the recommendation to implement our Generic Initiative. Essentially, the Generic Initiative works by encouraging our members to purchase generic drugs instead of their more expensive brand-name counterparts. Based upon the recommendations of our P&T Committee, we are introducing an important change to our pharmacy program for all of our new and renewing groups beginning July 2002. The change applies to specific brand-name drugs with generic equivalents that have been given an “A” rating by the FDA. For members choosing a generic drug, the incentive is reduced out-of-pocket costs for your prescription needs. And, long term, the practice of choosing generics is another way of keeping health care more affordable for everyone.


Generic Equivalent
Even if the Physician or duly licensed provider states on the prescription “dispense as written” (DAW), certain Prescription Drugs are restricted to the Generic Equivalent for payment by Blue Cross of Idaho.  In these instances, if the Insured requests the Brand Name Drug, the Insured is responsible for the difference between the price of the Generic Equivalent and the Brand Name Drug, regardless of formulary status, plus any applicable Brand Name Copayment/Coinsurance.

The list of generic equivalent medications is available on the Blue Cross of Idaho website under Pharmacy Info/Generic Equivalent Listing.

Policy Guidelines

A Brand Name medication may be considered medically necessary when the following criteria is met:

  1. Documentation of adverse medical event or adverse drug reaction , defined as “Any unexpected or dangerous reaction, or unwanted effect caused by the administration of a drug”.
  2. At least one generic equivalent medication trial in the past six months.  Obtained either by past BCI prescription drug claims, or for new members, documentation from previous carrier.
  3. Completion and submission of FDA MedWatch form.
    ( - Form FDA 3500)

If these criteria are met, then Blue Cross of Idaho may waive the additional member pay the difference (MPTD) copay amount or difference in price between the Generic Equivalent and the Brand Name Drug.  The member would still be required to pay any applicable Brand Name co-payment/coinsurance per the terms and conditions of their policy. 


To request an override of a generic equivalent drug for a member to receive a brand name drug, please complete the following authorization form:

Generic Initiative Medication Request Form 



Benefit Application

May not apply to Medicare Advantage, Medicare Supplement, Federal Employee Program (FEP) policies, or Individual polices without a Retail Prescription Drug Benefit, depending on policy and benefit requirements


May not apply to National or ASC Accounts, please check contract specific language.

RationaleFDA Therapeutic Equivalence of Generic Drugs Letter to Health Practitioners 01.28.1998 ( )

  1. FDA Orange Book ( )
  2. BCI member contract definition 





CPT  No Code  
ICD-9 Procedure No Code  
ICD-9 Diagnosis No Code  
HCPCS No Code  
Type of Service Prescription Drug  
Place of Service Pharmacy  


Generic drugs
Prescription drugs, generic

Policy History




06/27/2006   New policy
08/2008 Policy Updated Policy title changed; description section extensively revised 
10/06/09 Policy number update only Policy re-numbered to  5.01.96

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