OBJECTIVES: Chronic disease sufferers are particularly affected by prescription copayment increases as they are faced with decisions to switch to formulary alternatives or pay more to stay on their current medication. The objective of this study was to evaluate the impact of increased prescription copayments as a result of a change in formulary status on continuation rates of non formulary medications in multi-tiered pharmacy benefit plans. METHODS: Retrospective cohort study of chronic disease patients from a health plan in the Western U.S. Individuals were selected who were taking a medication that was being removed from the health plan's formulary and thus experienced increases in their copayments for non formulary medications (n=1244). Two time periods were studied: the "pre" period before and the "post" period after the increase in copayments. Adjusting for demographics, chronic co-morbidities, medication use, Medicare+Choice status and percentage increase in copayment for non formulary medications, Cox regressions were used to assess continuation rates for these medications. RESULTS: A clear relationship between increasing copayment differentials and continuation rates for non formulary medications in the post period could not be established. In general those who experienced higher copayment differentials (between 50-100%, 100-200% and greater than 200%) were more likely to continue their non formulary medication than those who experienced copayment increases of 25-50% and less than 25%. CONCLUSION: Individuals confronted with increased copayments often switched their medications to formulary alternatives. However, a clear relationship could not be established between increasing copayments and continuation behavior. Further research is needed to determine if these switching behaviors results in inappropriate medication behaviors such as complete discontinuation of drug therapy due to the increased costs.