You might have heard about the 'donut hole' in Medicare PDP plans. What is it? How will you be impacted? What is the government doing about it? This article answers these common questions.
Coverage gap aka ‘Donut Hole’
Effective 2020, what used to be called the 'donut hole' or gap in prescription drug coverage has practically disappeared.
Popularly known as the ‘donut hole', there was a gap in coverage in Medicare Part D where you ended up paying substantially more for your drugs (plan stopped paying and you bore all the costs after discounts and subsidies). Medicare kept reducing the “substantially more” costs every year so that effective 2020 the 'donut hole' has closed and you will only pay 25% of the costs of your drugs (both brand-name and generic, plus upto $3 pharmacy dispensing fee) until you reach the yearly out-of-pocket limit.
If you got Extra Help, you may not have been impacted by the ‘donut hole’.
Before, you would have entered the coverage gap once you and your plan had exhausted the Initial Coverage limit. Once there, you would have paid substantially more out-of-pocket for your prescriptions till your spend had reached the out-of-pocket threshold and hit Catastrophic Coverage level.
Now, this is what you will pay out-of-pocket for standard Part D coverage (during 2020):
Click here to learn more about Medicare, its various Parts, different enrollment periods and your costs.
We have also created videos to help you better understand various topics related to Medicare. Select and watch a video explaining the topic of your interest in a simple and intuitive manner.
Remember that you cannot choose just any combination of Parts and Plans. Let Lighted Road Insurance guide you step-by-step through the Medicare ecosystem and help you in selecting the right plan(s) for your needs.
Sign up for our FREE bi-weekly newsletter focused on lifestyle for the 50+. There is no obligation to enroll.
Last Updated: 11-17-2019