Defined standard (DS) benefits are the standard required benefits of a Part D drug plan. That means there is an annual deductible, 25% coverage in the initial coverage phase, and the plan offers no additional gap coverage. The defined standard benefits are subject to change each year, see the current defined standard benefits below.
TIP: There are four benefits types for Part D drug plans: Defined Standard (DS), Actuarially Equivalent (AE), Basic Alternative (BA), and Enhanced Alternative (EA). Learn more about the Medicare Part D Plan Benefit Types.
Defined Standard Benefits for Part D
Each year there is a minimum “Defined Standard” benefit structure in terms of cost-sharing, not drugs covered, that plans must meet by law.
Here are the Defined Standard prescription drug benefits for Part D in 2021 as an example [see CMS.Gov Medicare Part D announcement PDF]:
- Deductible: Up to $445.
- Initial coverage limit: $4,130.
- Out-of-pocket threshold: $6,550.
- Drug Costs During Initial Coverage Period: 25% (or up to $1,032.50 if in a plan with no deductible)
- Total covered Part D spending at the out-of-pocket expense threshold for beneficiaries who are not eligible for the coverage gap discount program: $9,313.75.
- Estimated total covered Part D spending at the out-of-pocket expense threshold for beneficiaries who are eligible for the coverage gap discount program: $10,048.39.
- Minimum cost-sharing under the catastrophic coverage portion of the benefit: $3.70 for generic/preferred multi-source drugs, and $9.20 for all other drugs.