Powered by Q1Group LLC
Education and Decision Support Tools for the Medicare Community

Explanation of Benefits (EOB) SECTION 2: Which ’drug payment stage’ are you in?

This section shows which drug coverage payment stage you are in. The four stages of coverage are deductible, initial coverage, coverage gap, and catastrophic coverage.

All four stages will always be shown in this section of the document and your current stage will be highlighted. The Language in Section 2 is customized to fit the payment stage the member is in. Within each stage, there are wording variations. These include variations for plan design (e.g., deductible vs. brand-name/tier level only deductible vs. non-deductible, partial coverage during the Coverage Gap) and for member receiving the Low-Income Subsidy (LIS) (partial LIS, full LIS) and non-LIS members. Examples will be shown for both LIS and non-LIS members.



SECTION 2. Which "drug payment stage" are you in?

This chart reflects the Initial Deductible stage for non-Low-Income Subsidy (LIS) Members
As shown below, your prescription drug coverage has "drug payment stages." How much you pay for a prescription depends on which payment stage you are in when you fill it. During the calendar year, whether you move from one payment stage to the next depends on how much is spent for your drugs.

You are in this stage:      
STAGE 1
Yearly Deductible

[If the plan has a deductible for all tiers, insert the following three bullets.]
  • You begin in this payment stage when you fill your first prescription of the calendar year. During this stage, you (or others on your behalf) pay the full cost of your drugs.

  • You generally stay in this stage until you (or others on your behalf) have paid $[deductible amount] for your drugs ($[ deductible amount] is the amount of your deductible).

  • As of [end date for the month] you have paid $[year-to-date Total Drug Costs] for your drugs.
[If the plan has a brand-name/tier level deductible, insert the following three bullets.]
  • During this payment stage, you (or others on your behalf) pay the full cost of your [brand-name/tier level] drugs.

  • You generally pay the full cost of your [brand-name/tier level] drugs until you (or others on your behalf) have paid $[Insert deductible amount] for your [brand-name/tier level] drugs ($[Insert deductible amount] is the amount of your [brand-name/tier level] deductible.)

  • As of [insert end date for the month] you have paid $[insert year-to-date Deductible Drug Costs] for your drugs in the deductible.
STAGE 2
Initial Coverage
  • During this payment stage, the plan pays its share of the cost of your [insert if applicable: generic/tier levels] drugs and you (or others on your behalf) pay your share of the cost.

  • [Insert if applicable: After you (or others on your behalf) have met your [brand-name/tier level] deductible, the plan pays its share of the cost of your [brand-name/tier level] drugs and you (or others on your behalf) pay your share of the cost.]

  • You generally stay in this stage until the amount of your year-to-date "total drug costs" (see Section 3) reaches $[insert initial coverage limit].

[If the plan has a brand-name/tier level deductible, insert the following bullet.]
  • As of [insert end date for the month] your year-to-date "total drug costs" were $[insert year-to-date Total Drug Costs]. (See definitions in Section 3.)
STAGE 3
Coverage Gap
  • During this payment stage, you (or others on your behalf) receive a 50% manufacturer’s discount on covered brand name drugs and the plan will cover [insert if additional brand gap coverage: "at least"] another 15%, so you will pay [insert if additional brand gap coverage: "less than"] 35% of the negotiated price on brand-name drugs. In addition you pay [insert if additional generic gap coverage: "less than"] 44% of the costs of generic drugs.

  • You generally stay in this stage until the amount of your year-to-date "out-of-pocket costs" (see Section 3) reaches $5000. When this happens, you move to payment stage 4, Catastrophic Coverage.
STAGE 4
Catastrophic Coverage
  • During this payment stage, the plan pays most of the cost for your covered drugs.

  • You generally stay in this stage for the rest of the calendar year (through December 31, 2018).
What happens next?      
Once you (or others on your behalf) have paid an additional $______ for your drugs, you move to the next payment stage (stage 2, Initial Coverage).      




The next chart reflects the Initial Coverage stage for non-Low-Income Subsidy (LIS) Members


Notes on the Initial Coverage column:
If your plan does not have a Deductible stage, the Initial Coverage column will begin with the text:
You begin in this payment stage when you fill your first prescription of the year. During this stage, .....

Notes on the Deductible column:
The text shown in the deductible column of the chart is the standard text If the plan has a deductible for all tiers.

If the plan has no deductible, the deductible column text is replaced with: (Because there is no deductible for the plan, this payment stage does not apply to you.)]

If the plan has a brand-name/tier level deductible, the following two bullets will appear in the deductible column.

• During this payment stage, you (or others on your behalf) pay the full cost of your [brand-name/tier level] drugs.

• You generally pay the full cost of your [brand-name/tier level] drugs until you (or others on your behalf) have paid $[insert deductible amount] for your [brand-name/tier level] drugs ($[insert deductible amount] is the amount of your [brand name/tier level] deductible.) This note applies to all of the charts to follow.

  You are in this stage:    
STAGE 1
Yearly Deductible

[If the plan has no deductible, replace the text in this cell with: (Because there is no deductible for the plan, this payment stage does not apply to you.) ]

[If the plan has a brand-name/tier level deductible, insert the following two bullets.]
  • During this payment stage, you (or others on your behalf) pay the full cost of your [brand-name/tier level] drugs.

  • You generally pay the full cost of your [brand-name/tier level] drugs until you (or others on your behalf) have paid $[insert deductible amount] for your [brand-name/tier level] drugs ($[insert deductible amount] is the amount of your [brand name/tier level] deductible.)

    [If the plan has a deductible for all tiers, insert the following two bullets.]

  • You begin in this payment stage when you fill your first prescription of the year. During this stage, you (or others on your behalf) pay the full cost of your drugs.

  • You generally stay in this stage until you have paid $[insert deductible amount] for your drugs ($[insert deductible amount] is the amount of your deductible). Then you move to payment stage 2, Initial Coverage.
STAGE 2
Initial Coverage
  • [Insert either: You begin in this payment stage when you fill your first prescription of the year. During this OR During this payment] stage, the plan pays its share of the cost of your [insert if applicable: generic/ tier levels] drugs and you (or others on your behalf) pay your share of the cost

  • [Insert if applicable: After you (or others on your behalf) have met your [brand-name/tier level] deductible, the plan pays its share of the cost of your [brand-name/tier level] drugs and you (or others on your behalf) pay your share of the cost.]

  • You generally stay in this stage until the amount of your year-to-date "total drug costs" (see Section 3) reaches $[insert initial coverage limit]. As of [insert end date for the month] your year-to-date "total drug costs" were $[insert year-to-date Total Drug Costs]. (See definitions in Section 3.)
STAGE 3
Coverage Gap
  • During this payment stage, you (or others on your behalf) receive a 50% manufacturer’s discount on covered brand name drugs and the plan will cover [insert if additional brand gap coverage: "at least"] another 15%, so you will pay [insert if additional brand gap coverage: "less than"] 35% of the negotiated price on brand-name drugs. In addition you pay [insert if additional generic gap coverage: "less than"] 44% of the costs of generic drugs.

  • You generally stay in this stage until the amount of your year-to-date "out-of-pocket costs" (see Section 3) reaches $5000. When this happens, you move to payment stage 4, Catastrophic Coverage.
STAGE 4
Catastrophic Coverage
  • During this payment stage, the plan pays most of the cost for your covered drugs.

  • You generally stay in this stage for the rest of the calendar year (through December 31, 2018).
  What happens next?    
  Once you (or others on your behalf) have an additional $______ in "total drug costs," you move to the next payment stage (stage 3, Coverage Gap).    




The next chart reflects the Coverage Gap stage for non-Low-Income Subsidy (LIS) Members

    You are in this stage:  
STAGE 1
Yearly Deductible

[If the plan has no deductible, replace the text in this cell with: (Because there is no deductible for the plan, this payment stage does not apply to you.) ]

[If the plan has a brand-name/tier level deductible, insert the following two bullets.]
  • During this payment stage, you (or others on your behalf) pay the full cost of your [brand-name/tier level] drugs.

  • You generally pay the full cost of your [brand-name/tier level] drugs until you (or others on your behalf) have paid $[insert deductible amount] for your [brand-name/tier level] drugs ($[insert deductible amount] is the amount of your [brand name/tier level] deductible.)

    [If the plan has a deductible for all tiers, insert the following two bullets.]

  • You begin in this payment stage when you fill your first prescription of the year. During this stage, you (or others on your behalf) pay the full cost of your drugs.

  • You generally stay in this stage until you have paid $[insert deductible amount] for your drugs ($[insert deductible amount] is the amount of your deductible). Then you move to payment stage 2, Initial Coverage.
STAGE 2
Initial Coverage
  • During this payment stage, the plan pays its share of the cost of your [insert if applicable: generic/tier levels] drugs and you (or others on your behalf) pay your share of the cost.

  • [Insert if applicable: After you (or others on your behalf) have met your [brand-name/tier level] deductible, the plan pays its share of the cost of your [brand-name/tier level] drugs and you (or others on your behalf) pay your share of the cost.]

  • You generally stay in this stage until the amount of your year-to-date "total drug costs" (see Section 3) reaches $[insert initial coverage limit]. Then you move to payment stage 3, Coverage Gap.
  • You generally stay in this stage until the amount of your year-to-date "out-of-pocket costs" (see Section 3) reaches $5000. As of [insert end date for the month] your year-to-date "total drug costs" were $[insert year-to-date Total Drug Costs]. (See definitions in Section 3.)
  • STAGE 4
    Catastrophic Coverage
    • During this payment stage, the plan pays most of the cost for your covered drugs.

    • You generally stay in this stage for the rest of the calendar year (through December 31, 2018).
        What happens next?  
        Once you (or others on your behalf) have paid an additional $______ in "out-of-pocket costs," you move to the next payment stage (stage 4, Catastrophic Coverage).  




    The next chart reflects the Catastrophic Coverage stage for non-Low-Income Subsidy (LIS) Members

          You are in this stage:
    STAGE 1
    Yearly Deductible

    [If the plan has no deductible, replace the text in this cell with: (Because there is no deductible for the plan, this payment stage does not apply to you.) ]

    [If the plan has a brand-name/tier level deductible, insert the following two bullets.]
    • During this payment stage, you (or others on your behalf) pay the full cost of your [brand-name/tier level] drugs.

    • You generally pay the full cost of your [brand-name/tier level] drugs until you (or others on your behalf) have paid $[insert deductible amount] for your [brand-name/tier level] drugs ($[insert deductible amount] is the amount of your [brand name/tier level] deductible.)

      [If the plan has a deductible for all tiers, insert the following two bullets.]

    • You begin in this payment stage when you fill your first prescription of the year. During this stage, you (or others on your behalf) pay the full cost of your drugs.

    • You generally stay in this stage until you have paid $[insert deductible amount] for your drugs ($[insert deductible amount] is the amount of your deductible). Then you move to payment stage 2, Initial Coverage.
    STAGE 2
    Initial Coverage
    • During this payment stage, the plan pays its share of the cost of your [insert if applicable: generic/tier levels] drugs and you (or others on your behalf) pay your share of the cost.

    • [Insert if applicable: After you (or others on your behalf) have met your [brand-name/tier level] deductible, the plan pays its share of the cost of your [brand-name/tier level] drugs and you (or others on your behalf) pay your share of the cost.]

    • You generally stay in this stage until the amount of your year-to-date "total drug costs" (see Section 3) reaches $[insert initial coverage limit]. Then you move to payment stage 3, Coverage Gap.
    STAGE 3
    Coverage Gap
    • During this payment stage, you (or others on your behalf) receive a 50% manufacturer’s discount on covered brand name drugs and the plan will cover [insert if additional brand gap coverage: "at least"] another 15%, so you will pay [insert if additional brand gap coverage: "less than"] 35% of the negotiated price on brand-name drugs. In addition you pay [insert if additional generic gap coverage: "less than"] 44% of the costs of generic drugs.

    • You generally stay in this stage until the amount of your year-to-date "out-of-pocket costs" (see Section 3) reaches $5000. When this happens, you move to payment stage 4, Catastrophic Coverage.
    STAGE 4
    Catastrophic Coverage
    • During this payment stage, the plan pays most of the cost for your covered drugs.

    • [Plans must insert a brief explanation of what the member pays during this stage. For example: "For each prescription, you pay whichever of these is larger: a payment equal to 5% of the cost of the drug (this is called "coinsurance"), or a copayment ($3.35 for a generic drug or a drug that is treated like a generic, $8.35 for all other drugs)"].
          What happens next?
          You generally stay in this payment stage, Catastrophic Coverage, for the rest of the calendar year (through December 31, [insert year]).


    If the plan has a deductible applicable to ALL tier levels, use the following version of Section 2 for members with partial LIS who are in the yearly deductible stage,

    STAGE 1 Yearly Deductible
    • You begin in this payment stage when you fill your first prescription of the year. During this stage, you (or others on your behalf) pay the full cost of your drugs.

    • You generally stay in this stage until you (or others on your behalf) have paid $[insert appropriate deductible amount for member with partial LIS] for your drugs. [Only insert if deductible is more than the partial subsidy deductible limit: (The plan deductible is usually $[insert usual plan deductible], but you pay $ [insert appropriate deductible amount for member with partial LIS] because you are receiving "Extra Help" from Medicare.)]

    • As of [insert end date of month] you have paid $[insert year-to-date Total Drug Costs] for your drugs.

    STAGE 3 Coverage Gap
    (Because you are receiving "Extra Help" from Medicare, this payment stage does not apply to you.)

    The following version of Section 2 is for members with LIS who are in the initial payment stage

    Member with LIS (or "Extra Help") jump over the Coverage Gap stage. Once they stay in the Initial Coverage stage until they have met the TrOOP limit; then they move directly to stage 4, Catastrophic Coverage (skipping the Coverage Gap).

    STAGE 1 Yearly Deductible
    [If the plan has a deductible and the EOB is for a member with full LIS, insert the following text as a replacement for the other text in the deductible column: (Because you are receiving "Extra Help" from Medicare, this payment stage does not apply to you.)]

    [If the plan has a brand-name/tier level deductible, insert the following two bullets.]

    • During this payment stage, you (or others on your behalf) pay the full cost of your [brand-name/tier level] drugs.

    • You generally pay the full cost of your [brand-name/tier level] drugs until you (or others on your behalf) have paid $[insert deductible amount] for your [brand-name/tier level] drugs ($[insert deductible amount] is the amount of your [brand name/tier level] deductible.) [Only insert if deductible is more than the partial subsidy deductible limit: (The plan deductible is usually $[insert usual plan deductible], but you pay $ [insert appropriate deductible amount for member with partial LIS] because you are receiving "Extra Help" from Medicare.)]

    [If the plan has a deductible for all tiers, insert the following two bullets.]

    • You begin in this payment stage when you fill your first prescription of the year. During this stage, you (or others on your behalf) pay the full cost of your drugs.

    • You generally stay in this stage until you (or others on your behalf) have paid $[insert appropriate deductible amount for member with partial LIS] for your drugs ($[insert appropriate deductible amount for member with partial LIS] is the amount of your deductible). Then you move to payment stage 2, Initial Coverage.

    STAGE 2 Initial Coverage
    • [Insert either: You begin in this payment stage when you fill your first prescription of the year. During this OR During this payment] stage, the plan pays its share of the cost of your [insert if applicable: generic/tier levels] drugs and you (or others on your behalf, including "Extra Help" from Medicare) pay your share of the cost.

    • [Insert if applicable: After you (or others on your behalf) have met your [brand-name/tier level] deductible, the plan pays its share of the cost of your [brand-name/tier level] drugs and you (or others on your behalf) pay your share of the cost.]

    • You generally stay in this stage until the amount of your year-to-date "out-of-pocket costs" reaches $[insert TrOOP limit]. As of [insert end date of month] your year-to-date "out-of-pocket costs" was $[insert year-to-date TrOOP] (see definitions in Section 3).


    Examples of Section 2 of the Explanation of Benefits (EOB)

    The document below shows a number of example of Section 2 of the Explanation of Benefits. This includes examples for beneficiaries with no financial "Extra Help" (or Low-Income Subsidy LIS), some examples for persons with partial LIS and others receiving full LIS.
    Advertisement

    Medicare Supplements
    fill the gaps in your
    Original Medicare
    1. Enter Your ZIP Code:
    » Medicare Supplement FAQs

    Advertisement




    Pets are Family Too!
    Use your drug discount card to save on medications for the entire family ‐ including your pets.

    • No enrollment fee and no limits on usage
    • Everyone in your household can use the same card, including your pets
    Your drug discount card is available to you at no cost.




    Advertisement



    Have a Prescription Not Covered by Your Medicare Plan?
    Prescription Discounts are
    easy as 1-2-3
    1. Locate lowest price drug and pharmacy
    2. Show card at pharmacy
    3. Get instant savings!
    Your drug discount card is available to you at no cost.



    Tips & Disclaimers
    • The Medicare Advantage and Medicare Part D prescription drug plan data on our site comes directly from Medicare and is subject to change.
    • Medicare has neither reviewed nor endorsed the information on our site.
    • We provide our Q1Medicare.com site for educational purposes and strive to present unbiased and accurate information. However, Q1Medicare is not intended as a substitute for your lawyer, doctor, healthcare provider, financial advisor, or pharmacist. For more information on your Medicare coverage, please be sure to seek legal, medical, pharmaceutical, or financial advice from a licensed professional or telephone Medicare at 1-800-633-4227.
    • We are an independent education, research, and technology company. We are not affiliated with any Medicare plan, plan carrier, healthcare provider, or insurance company. We are not compensated for Medicare plan enrollments. We do not sell leads or share your personal information.
    • Benefits, formulary, pharmacy network, provider network, premium and/or co-payments/co-insurance may change on January 1 of each year. Our PDP-Compare.com and MA-Compare.com provide highlights of annual plan benefit changes.
    • The benefit information provided is a brief summary, not a complete description of benefits. For more information contact the plan.
    • Limitations, copayments, and restrictions may apply.
    • We make every effort to show all available Medicare Part D or Medicare Advantage plans in your service area. However, since our data is provided by Medicare, it is possible that this may not be a complete listing of plans available in your service area. For a complete listing please contact 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week or consult www.medicare.gov.
    • When enrolling in a Medicare Advantage plan, you must continue to pay your Medicare Part B premium.
    • Medicare beneficiaries with higher incomes may be required to pay both a Medicare Part B and Medicare Part D Income Related Monthly Adjustment Amount (IRMAA). Read more on IRMAA.
    • Medicare Advantage plans that include prescription drug coverage (MAPDs) are considered Medicare Part D plans and members with higher incomes may be subject to the Medicare Part D Income Related Monthly Adjustment Amount (IRMAA), just as members in stand-alone Part D plans. In certain situations, you can appeal IRMAA.
    • You must be enrolled in both Medicare Part A and Part B to enroll in a Medicare Advantage plan. Members may enroll in a Medicare Advantage plan only during specific times of the year. Contact the Medicare plan for more information.
    • If you are enrolled in a Medicare plan with Part D prescription drug coverage, you may be eligible for financial Extra Help to assist with the payment of your prescription drug premiums and drug purchases. To see if you qualify for Extra Help, call: 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048, 24 hours a day/ 7 days a week or consult www.medicare.gov; the Social Security Office at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday. TTY users should call, 1-800-325-0778; or your state Medicaid Office.
    • Medicare evaluates plans based on a 5-Star rating system. Star Ratings are calculated each year and may change from one year to the next.
    • A Medicare Advantage Private Fee-for-Service plan (PFFS) is not a Medicare supplement plan. Providers who do not contract with the plan are not required to see you except in an emergency.
    • Disclaimer for Institutional Special Needs Plan (SNP): This plan is available to anyone with Medicare who meets the Skilled Nursing Facility (SNF) level of care and resides in a nursing home.
    • Disclaimer for Dual Eligible (Medicare/Medicaid) Special Needs Plan (SNP): This plan is available to anyone who has both Medical Assistance from the State and Medicare. Premiums, co-pays, co-insurance, and deductibles may vary based on the level of Extra Help you receive. Please contact the plan for further details.
    • Disclaimer for Chronic Condition Special Needs Plan (SNP): This plan is available to anyone with Medicare who has been diagnosed with the plan specific Chronic Condition.
    • Medicare MSA Plans combine a high deductible Medicare Advantage Plan and a trust or custodial savings account (as defined and/or approved by the IRS). The plan deposits money from Medicare into the account. You can use this money to pay for your health care costs, but only Medicare-covered expenses count toward your deductible. The amount deposited is usually less than your deductible amount, so you generally have to pay out-of-pocket before your coverage begins.
    • Medicare MSA Plans do not cover prescription drugs. If you join a Medicare MSA Plan, you can also join any separate (stand-alone) Medicare Part D prescription drug plan
    • There are additional restrictions to join an MSA plan, and enrollment is generally for a full calendar year unless you meet certain exceptions. Those who disenroll during the calendar year will owe a portion of the account deposit back to the plan. Contact the plan provider for additional information.
    • Medicare beneficiaries may enroll through the CMS Medicare Online Enrollment Center located at www.medicare.gov.
    • Medicare beneficiaries can file a complaint with the Centers for Medicare & Medicaid Services by calling 1-800-MEDICARE 24 hours a day/7 days or using the medicare.gov site. Beneficiaries can appoint a representative by submitting CMS Form-1696.