Congress Called On to Fill in the Medicare Doughnut Hole

The Medicare Part D plan is notorious for its so-called doughnut gap. The doughnut gap is the gap in coverage where beneficiaries generally start paying the full cost for their medicines. This happens when total drug expenditures by the beneficiary reach $2,700. This gap in coverage usually occurs during the summer or fall and it forces millions of beneficiaries to pay the full cost of their drugs. Congress is now being called on to eliminate or at least decrease the gap as part of the efforts to reform health care.

The main challenge that Congress has in trying to close the gap is where the money will come from. The Congressional Budget Office claims that closing the gap and providing continuous coverage for all beneficiaries would cost $134 billion over 10 years. At a time when the government is already struggling to reduce the federal deficit and Medicare is already estimated to go bankrupt by 2017, the concern over the gap may have to be dismissed and people under Medicare may have to continue spending thousands of dollars a year to fill their prescriptions.

This year an estimated 3 million of the 27 million older Americans who receive Medicare drug benefits will reach the coverage gap and pay the full cost of their prescriptions or risk their health by reducing their medication or stop taking it altogether when their costs reach $2,700. These Americans will be on their own to pay the next $3,454 of prescriptions before they become eligible for Medicare’s catastrophic coverage. With that coverage, beneficiaries are only responsible for only 5% of their bills for the rest of the year.

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