•December 6, 2017•

By Wendell Potter,
Rural Health News Service
Medicare and drug coverage: some good news, some bad

One of the benefits of the Affordable Care Act to Medicare beneficiaries has been the gradual closing of a big and costly gap called the “doughnut hole” in the prescription drug (Medicare Part D) program. By the end of 2020—if the ACA is not repealed or altered substantially by Congress—the doughnut hole will be completely closed.

In 2010, people hit the doughnut hole coverage gap when the total amount they and their plan had paid for prescription drugs reached $2,800 in a coverage year. At that point, people had to pay the full cost of their prescription drugs until they had reached the out-of-pocket spending limit established by the law. In 2010 that limit was $4,550. After someone paid that much, their plan paid 95 percent of the cost of their drugs for the rest of the year.

The gap has been shrinking a little every year since the ACA (Obamacare) was enacted in 2010. This year, those enrolled in the Part D program personally paid 40 percent of the cost of brand-name drugs in the doughnut hole and 51 percent of the cost of generic drugs. Next year, the percentages will drop to 35 percent and 44 percent, respectively. In 2020 and beyond, Medicare Part D beneficiaries will pay 25 percent for both brand-names and generics.      Login or Subscribe to read the rest of this story.