What is the Coverage Gap (Doughnut Hole)?
The Medicare Part D drug benefit does have a coverage gap, known as the “doughnut hole,” where Part D enrollees are responsible for paying 100% of total drug costs until they reach the catastrophic coverage level. After the PDP and beneficiary have paid a set amount of dollars, no more than $2,830 in 2010, the beneficiary is required to pay for all of their drug costs up to a certain limit before catastrophic coverage becomes available. For 2010, beneficiaries are responsible for paying up to $3,610 while in the coverage gap (will vary from plan to plan). This amount does not include the plan’s monthly premium. After reaching their plans out-of-pocket limit, they will have catastrophic coverage for the remainder of the calendar year.
