Medicare Coverage Gap

Upon reaching a cumulative expenditure of $5,030 in 2024, your transition into the Medicare Donut Hole commences. During this phase, which entails paying 25% of both brand-name and generic prescription costs, a medication originally priced at $100 would shift from a Tier 3 copay of $46 pre-Gap to costing you $25 within the Gap. Conversely, if it were classified as a tier 2 drug with an initial copay of $10 before entering the coverage Gap, your expense during that period would be adjusted to match.

Throughout your time in the Coverage Gap stage, Medicare diligently tracks spending jointly incurred by you and your insurance provider. Exiting this phase is contingent upon out-of-pocket drug expenses hitting $8,000 for the year 2024 – triggering entry into Catastrophic Coverage under Medicare Part D’s fourth stage where cost-sharing has been abolished since 2024. In Catastrophic Coverage Stage post-transitioning from the Donut Hole Phase; all medication costs are fully covered by your plan until year-end.

Certain medications lie outside Part D’s purview entirely and thus do not contribute towards breaching the Medicare Donut Hole threshold – consult our inventory detailing such exclusions for further insights.
Despite its challenges, navigating through the Coverage Gap underscores how recent advancements like Medicare Part D have significantly curbed pharmaceutical expenditures among countless beneficiaries on Medicare plans.
Moreover; many Part D providers engage in negotiations securing discounted rates with drug manufacturers ensuring members benefit from these concessions merely by enrolling in their respective plans.

At times, individuals inquire about whether their Medigap plan will encompass the coverage gap in their prescription drug plan. The response is negative. Medigap plans specifically assist in covering costs for hospital and medical services, excluding medications which are covered separately under Part D.

Annually, we encounter clients seeking assistance in locating a Part D drug plan that lacks a coverage gap. Such a plan is currently unavailable in most states, as there are no Medicare Part D plans that exclude the donut hole. Additionally, there is no standalone insurance plan accessible for purchase to address the Medicare donut hole. Further details on this topic can be found here.

Nonetheless, individuals with limited incomes and assets may be eligible for the low-income subsidy known as Extra Help for Part D. If eligible, Medicare will waive the coverage gap and significantly reduce prescription copayments. The subsidy application can be submitted at a local Social Security office or through their website.

Medicare calculates the total cost of your medications included in the Medicare coverage gap, so it’s important to be aware of the complete cost of each medication you are prescribed. You can easily track this by examining your insurance company statements.

To find more strategies for reducing your out-of-pocket expenses for Part D, refer to our blog post on the topic: Ways to Cut Costs in the Part D Coverage Gap.

Our team of insurance agents at Boomer Benefits undergo thorough training to carefully evaluate your potential drug expenses if you are new to Medicare and arranging your Part D coverage for the first time.

Additionally, we offer ongoing guidance on using Medicare’s Plan Finder to select your Part D plan annually. This personalized assistance is exclusively available to our Medigap and Medicare Advantage policyholders.

Concerned about the coverage gap? Reach out to our agency for complimentary assistance with Part D once you have obtained your Medicare Supplement plan through us.