In what order do the four prescription drug coverage stages occur?

The sequence of the four stages of prescription drug coverage under Medicare Part D follows a specific pattern that begins with the deductible phase. In this context, the deductible stage requires beneficiaries to pay for their prescriptions up to a certain amount before the plan starts to contribute.

Once the deductible is met, beneficiaries enter the initial coverage stage, where they share the costs of medications with their plan. This is the phase where most basic coverage occurs, allowing participants to receive their medications at a reduced cost.

Following the initial coverage stage is the coverage gap, often referred to as the “donut hole.” During this stage, beneficiaries may have a higher out-of-pocket cost for medications after reaching a specific spending limit.

Finally, once the out-of-pocket expenses surpass a predetermined threshold, individuals enter the catastrophic coverage stage. In this phase, the costs for covered drugs significantly decrease, leading to much lower out-of-pocket expenses for the beneficiary.

This progression outlines how beneficiaries move through the stages of coverage, capturing the necessary financial responsibilities at each step. The correct order showcases the logical flow of how prescription drug plans are structured and function within Medicare Part D.