Which statement describes a closed formulary?

• A. Limited drug selection
• B. Broad drug choices
• C. Higher costs across the board
• D. No impact on cost

Answer: (A)

A closed formulary restricts coverage to a specific, limited list of medications. Because only those drugs are covered (often with prior authorization for non-listed drugs), prescribers and patients are guided toward a narrower set of options. This tighter selection allows the plan to negotiate better prices and manage costs more effectively, which is the main reason such a formulary is used. The statement that best describes this is that there is limited drug selection.

The other descriptions don’t fit as well: a broad drug list would characterize an open formulary, which offers many more choices. Saying costs rise across the board isn’t the defining outcome of a closed formulary, though costs can be managed or reduced by restricting options. Saying there’s no impact on cost ignores the cost-control purpose of limiting the formulary.