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I want to be sure I understand the Part D “doughnut hole” or coverage gap. Could you tell me how it works?

 

En español | Part D prescription drug plans require monthly premiums, often a deductible and variable cost-sharing for each prescription drug. In 2014, if your total drug costs (what you and your plan pay) exceed $2,850, then you will fall into the coverage gap (“doughnut hole”).

During this gap in coverage, you continue to pay your premiums, and you will be responsible for a much greater cost of each prescription than before you entered the gap. The cost of prescriptions are discounted, however: in 2014, you’ll get a 52.5 percent discount on brand-name drugs, and a 28 percent discount on generic prescription drugs. If your out-of-pocket costs exceed $4,550 in 2014, then you would enter the “catastrophic” coverage phase, during which you are responsible for 5 percent of your prescription drug costs for the rest of the year.

Through gradually increasing discounts on brand and generic prescriptions filled during the doughnut hole, it is being phased out by 2020. Persons who qualify for an Extra Help program will not face additional cost-sharing for prescriptions filled in the doughnut hole.

 

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