Which one of the following is an accurate description of the coverage gap, also known as the donut hole, in Medicare Part D?

The coverage gap, commonly referred to as the donut hole, describes a specific phase in the Medicare Part D prescription drug plan where beneficiaries experience a temporary reduction in their coverage for prescription medications. After reaching a certain threshold of total drug costs, beneficiaries enter the donut hole phase, during which they must pay a higher percentage of their drug costs out-of-pocket, often through fixed coinsurance.

This phase begins after the initial coverage limit is surpassed. Once beneficiaries reach the out-of-pocket spending threshold, they exit the coverage gap and transition into catastrophic coverage, where their costs typically decrease significantly. Therefore, the accurate description highlighting that a fixed coinsurance applies after a specific spending limit aligns with the nature of Medicare Part D's coverage gap, emphasizing the shift in cost-sharing during this period.