A formulary exception is a formal request to your insurance plan to cover a medication that is not on its formulary — or to cover a listed drug at a lower cost tier — because the formulary alternatives are not appropriate for you. Your prescriber submits it with supporting documentation, usually a letter of medical necessity explaining why the preferred drugs failed, caused side effects, or are contraindicated.
For GLP-1s this comes up when a plan covers one drug in the class but not the one that works for you, or when weight-management versions are excluded while diabetes versions are listed. An exception request is distinct from an appeal: it asks for coverage outside the normal rules rather than disputing a denial, though a refused exception can then be appealed. See how to determine if your formulary covers GLP-1 medications. For Medicare drug plans, CMS (external link) sets out formulary and tiering exceptions, the prescriber's supporting statement, and how to appeal a denial.