Avoiding the Part D Donut Hole


Did you or someone you work with fall into the Medicare Part D “donut hole” this year?

The donut hole, or Part D coverage gap, occurs when a person reaches a certain spending limit for their medications ($3,820 in 2018), and must pay more of the costs after crossing that threshold.

Here’s how you can try to avoid the donut hole altogether and get financial assistance if you do fall into the coverage gap.

The importance of shopping around

The Annual Enrollment Period for Medicare Advantage and Part D plans runs October 15 – December 7. During this time, people with Medicare can join, switch, or leave plans.

This Part D plan checklist, developed for NCOA by the Medicare Rights Center, provides a list of questions to ask before selecting prescription drug coverage. Aside from looking at costs, you also want to make sure that you choose a plan that covers all/most of your medications and makes it convenient for you to obtain them.

Using the Medicare Plan Finder, you can enter your prescription information and compare plans to determine what your costs may be in the coming year, including when/if you would expect to fall into the donut hole. Some plans may offer additional coverage during the coverage gap, like for generic drugs; however, they may charge a higher monthly premium. Working with an unbiased counselor, such as those at your State Health Insurance Assistance Program (SHIP) can help. Or use the questionnaire at NCOA’s My Medicare Matters to get recommendations about your coverage options.

Isn’t the donut hole closing in 2019?

You may have heard that the Affordable Care Act set in motion plans to close the Part D coverage gap by 2020, which was advanced a year in recent Medicare legislation. But “closing” does not mean that people reaching the donut hole do not pay anything for their drugs—it means that plans and pharmaceutical companies pick up more of the tab.

Beginning in 2019, Medicare beneficiaries enrolled in Part D prescription drug plans reaching the donut hole will still pay 37% of the costs of their generic medications, and 25% of the brand-name medications.

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