Prescription drug coverage is an increasingly important component of any health insurance plan. Previous research has indicated that the optimal use of health insurance by plan members is at least somewhat dependent upon their understanding of its design and inherent cost-containment features. This study employed face-to-face interviews of pharmacy patrons with at least some sort of prescription drug coverage to determine their understanding of any pharmacy plan's limitations, the use of formularies, and the concept of generic versus branded drugs, in addition to assessing their sources for obtaining information about their prescription drug plans. Most respondents were able to differentiate between generic and branded drugs, but few of them understood the other cost-containment components of their prescription drug plans. Many subjects relied on their pharmacist, rather than their employer or insurer to provide such information. Despite statistically significant contributions by income level and other demographic and health-related variables, little of the variation in knowledge of these prescription drug issues was explained.