The 2012 Benchmark for Medicare Part D Coverage
Coverage Levels |
Coverage Level Limits |
What You Pay |
||||||||||
| Deductible | Of First $320 | 100% | ||||||||||
| Initial Coverage Period | After deductible and until total prescription drug costs reach $2,930 | 25% | ||||||||||
| Coverage Gap (Donut Hole) | Once total yearly drug costs reach $2,930 and until your yearly out-of-pocket drug costs reach $4,700 | 100% (50% discount for most brand name drugs and 14% discount for most generics) | ||||||||||
| Catastrophic Coverage | After your out-of-pocket drug expenses reach $4,700 | 5% or $2.60 for generic, and $6.50 brand, whichever is greater |
The Affordable Care Act signed into law on March 23, 2010 makes several changes to Medicare Part D to reduce your out-of-pocket costs when you reach the "donut hole", including:
- In 2010, if you had expenses in the coverage gap, you should have received a $250 rebate from Medicare.
- Beginning in 2011, if you reach the donut hole, you will be given a 50% discount on the total cost of brand name drugs while in the gap.
- Medicare will phase in additional discounts on the cost of both brand name and generic drugs.
By 2020, these changes will effectively close the coverage gap and rather than paying 100% of the costs, your responsibility will be 25% of the costs.