How Does the Medicare Donut Hole Work?

4 Things You Need to Know About the Medicare Donut Hole

The Medicare donut (doughnut) hole or Medicare gap is one of the most complicated areas of Medicare. Due to changes that occur in Medicare almost every year, it takes someone who is specifically trained in Medicare practices to help guide you through this maze. Simplified, the Medicare donut hole coverage affects how much money you will pay for your prescription medication after your Medicare Plan D runs its course for the year.

1. Stages

  • Pay your deductible
  • Pay your copays up to a predetermined limit
  • Donut hole stage – pay a large portion of prescription costs to a predetermined limit (The Affordable Care Act can help.)
  • Copay a percentage of your prescriptions until the new year

2. Not Everyone Is Affected

Even though it is good to be aware of how donut hole coverage could affect you, there is a good chance you won’t fall into the group that is affected. The amount of your prescription medications determines if the donut hole will be something you need to worry about. If your medication bills are less than what your Medicare Plan D covers, the donut hole will not concern you.

3. Falling Into the Donut Hole

If you require many and/or costly prescription medications that exceed the amount of your Medicare Part D coverage, you will fall into the category of drug coverage payments called the Medicare donut hole or Medicare gap. This means you will be required to pay for most of your prescription costs until they total a certain amount. At that time, your portion will be reduced until the end of the year. Having Medicare supplemental insurance can help with the cost of the Medicare gap. For specifics about your cost, your Medicare provider or Medicare Insurance Advisors will be able to help.

4. You Can Avoid the Donut Hole

Keeping your prescription drug costs as low as possible before reaching your cap can help you to avoid being stuck in the Medicare donut hole. Pharmacies can charge different amounts for the same drug, so try to find one that offers the lower price. You might be able to get multiple months’ worth of your prescription at one low price, which will help to keep your overall cost down. Using generic medication when possible is another way to keep your costs down and to keep you from going past the limit of your Medicare Part D coverage.

Call us today at Medicare Insurance Advisors to discuss how the Medicare donut hole can affect your drug coverage costs. One of our team members can answer your questions and other Medicare-related subjects.