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

The correct order in which the four prescription drug coverage stages occur begins with the Deductible stage, followed by Initial Coverage, then the Coverage Gap, and finally Catastrophic Coverage.

In the Deductible stage, beneficiaries are responsible for paying the full cost of their prescriptions until they meet a predetermined deductible amount. Once this deductible is met, they move into the Initial Coverage stage, where they pay a copayment or coinsurance for their medications as the plan covers a larger portion of the costs.

If beneficiaries exceed a certain spending threshold during the Initial Coverage stage, they enter the Coverage Gap, commonly referred to as the "donut hole." In this stage, beneficiaries may have to pay a higher percentage of their prescription costs.

Once out-of-pocket expenses reach a specific limit in the Coverage Gap, individuals move into the Catastrophic Coverage stage. Here, the plan provides more extensive coverage, and beneficiaries pay lower costs for medications, usually a small copayment or coinsurance amount.

Understanding this sequence is crucial for managing prescription costs and benefits effectively.