Patches are cummulative. Each patch is essentially a complete version of ESXi.
When you install ESXi there are two hypervisor partitions. With a fresh install only the first contains an ESXi image and the 2nd is emtpy. The first is /bootbank when you access the shell and the 2nd is /altbootbank.
When you patch your host the new image is written to /altbootbank (/bootbank is left untouched). When ESXi next boots, the two bootbanks are switched so the newest becomes /bootbank. The process repeats when you next patch your host. Once advantage to this method is that you can quickly revert to the prior version if you have a problem after updating. Shift+R during the initial boot screen gives you the option to revert back to the old version.
