Insurance Denials For Brand-Name Prescription Drugs Rose Sharply From 2018 To 2024

A new study led by researchers at the Johns Hopkins Bloomberg School of Public Health and the American Enterprise Institute found that insurance denials of first attempts to fill prescriptions for brand-name prescription drugs with no generic competitors increased more than two-thirds between 2018 and 2024.

The researchers analyzed more than 2 million prescription attempts for brand-name drugs with no generic alternative across commercial insurance, Medicare, Medicaid, and Affordable Care Act marketplace plans.

Overall, rejections rose from 24.3% of initial brand-name prescription attempts in 2018 to 40.7% in 2024--an increase of 67%. Among initially rejected fill attempts, 48.4% were not followed by a fill of the prescribed drug or another drug in the same therapeutic class within 90 days. Patients who eventually obtained treatment filled their prescriptions on average 12 days after the initial rejection.

Nearly one-third of initial fill attempts--32%--were rejected because of formulary exclusions--a drug not being covered by the insurance plan--or insurers' utilization management rules. These rules, designed to help control costs, often require prior authorization by the insurance company or that patients try other drugs before receiving the originally prescribed brand-name drug.

Growing use of utilization management rules was the greatest driver of brand-name prescription drug rejections. Commercial insurance plans and Medicaid managed care plans experienced some of the sharpest increases in utilization management restrictions during the study period.

The study was published online in JAMA.

"We found that insurance restrictions are increasingly shaping whether and when patients receive medications their clinicians prescribe," says Joseph Levy, PhD, an assistant professor in the Bloomberg School's Department of Health Policy and Management and lead author of the study. "While these policies may help control drug spending, they can also create meaningful barriers to timely treatment and place growing administrative burdens on patients, pharmacists, and clinicians."

The findings highlight the trade-offs between controlling prescription drug spending and ensuring timely access to treatment. Historically, brand-name drugs account for a small fraction of total prescriptions but the majority of U.S. drug spending. In 2024, brand-name drugs accounted for about 10% of total prescriptions filled and 88% of spending, according to the Association for Accessible Medicines. This represented about 435 million brand-name prescriptions costing $700 billion. Much of this spending occurs before generic competition is available due to patents or other market exclusivity.

In contrast, generics and biosimilars accounted for about 90% of prescriptions filled and 12% of prescription drug spending in 2024--roughly 3.9 billion generic and biosimilar prescriptions costing $98 billion.

For their study, the researchers analyzed pharmacy claims data from 1.17 million individuals attempting to fill prescriptions for single-source brand-name drugs for the first time between January 2018 and September 2024. The study drew from IQVIA's Formulary Impact Analyzer, a national database of anonymized outpatient pharmacy claims representing all major insurance markets in the United States.

Of the prescriptions initially denied, 39% were ultimately filled with the originally prescribed medication within 90 days, while 13% were filled with a different drug in the same therapeutic class. Rejection rates varied across therapeutic classes, ranging from a high of an 85% initial rejection rate for Incretin-based therapies for weight loss--including GLP-1 receptor agonists and related drugs--to 6.7% for oral anticoagulants. GLP-1 and related incretin drugs were among the most common single-source branded drugs in the study.

The study found substantial variation across insurance types. Marketplace exchange plans and Medicaid-managed care plans experienced the highest rejection rates--nearly half of all initial prescription attempts were denied--while Medicare plans had lower rejection rates.

Because coverage barriers were identified at the pharmacy counter, the study captures what happens after a prescription is written, not whether formularies influence clinicians' initial prescribing decisions. Even so, the findings suggest that clinicians may not always know when a prescribed medication is excluded from a patient's formulary or requires prior authorization before it can be filled. The researchers note that better real-time information about insurance restrictions at the point of prescribing, along with simpler prior authorization processes, could help reduce delays in care.

"As utilization management becomes more common, it's important to better understand how these policies affect real-world treatment initiation and patient's access to medicines," Levy says.

The study has several limitations. The analysis may miss prescriptions filled elsewhere or through other payment channels, given the database includes claims only from participating pharmacies. The researchers also could not always identify rejection reasons or determine whether patients received clinically appropriate alternatives from another therapeutic class.

The authors suggest that simplifying and standardizing prior authorization requirements could reduce avoidable pharmacy rejections and treatment delays. They note, however, that such reforms may involve trade-offs, including higher drug costs, as formulary management tools can help insurers negotiate discounts, encourage the use of preferred or evidence-based therapies, and, when implemented effectively, promote more clinically appropriate and cost-effective prescribing.

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