Shrinking the donut hole

With Medicare Part D coverage, when your total drug costs reach $2,840, you may be responsible for 100% of the costs until you reach $4,550. This coverage gap is sometimes called the “donut hole.” Health care reform seeks to shrink the donut hole beginning in 2011 and gradually eliminate it by 2020.

In addition, beginning this year, drug makers are required to offer a 50% discount on brand-name prescriptions filled in the Medicare Part D coverage gap. Federal subsidies will be offered for brand-name prescriptions filled in the coverage gap too. These subsidies will reach 25% by 2020.

Topics: Health care costs, Medicare, Health reform