To have lower costs, many plans place drugs into different "tiers," which cost different amounts. Each plan can form their tiers in different ways. Here is an example of how a plan might form its tiers. Example: Tier 1 - Generic drugs. Tier 1 drugs will cost you the least amount. Tier 2 - Preferred brand-name drugs. Tier 2 drugs will cost you more than Tier 1 drugs. Tier 3 - Non-preferred brand-name drugs. Tier 3 drugs will cost you more than Tier 1 and Tier 2 drugs.