What are the different stages in a Part D plan?
There are 4 stages to a Medicare Part D prescription drug plan.
• Deductible: You pay the full amount for your medications until you meet the deductible amount and your plan begins to pay its share of the cost for your covered drugs.
• Initial Coverage: Once you meet the deductible amount, you pay either a copayment or coinsurance for your medicines (depending on the drug tier they are on) and the plan pays the rest until you and the plan together meet an amount set by Medicare. This amount changes each year.
• Coverage Gap: The third stage of a standard Part D plan begins after you and your plan together exceed the amount set by Medicare. In this stage you will pay more for your covered drugs until you reach a certain amount, again set by Medicare. Your deductible, coinsurance and copayments all count towards getting you out of the Gap. The coverage gap is closing and each year the amount you pay for brand-name drugs will go down until it is 20%
• Catastrophic Coverage: Once you get out of the Gap, you automatically get “catastrophic coverage.” In this last stage of a Part D plan you pay a small copayment or coinsurance for covered medications for the rest of the calendar year. you fulfill the deductible amount and your plan begins to pay its share of the cost for your covered drugs.