No, the Medicare donut hole isn’t a tasty treat. In fact, it’s an expensive surprise that you’ll want to avoid at all costs. Medicare can be confusing and overwhelming on a good day, so we’ll dive into everything you need to know about the Medicare Part D donut hole and how to avoid it when possible so that you can get the coverage and medication you need without going into the red.
What Is Medicare Donut Hole?
Medicare Part D enrollment is the prescription drug benefit portion of Medicare that helps pay for self-administered prescription drugs. There are different payment stages of Medicare Part D, and how much you pay for your prescription drugs out of pocket depends on what payment stage you’re in.
- First stage: you pay the deductible for your prescription medications
- Second stage: you pay your co-pay and once you and your plan have jointly paid $4,130, you move into the third stage.
- Third stage: you’re in the donut hole and have to pay for your medication out of pocket until you’ve spent $6,550
- Fourth stage: once you’ve passed $6,350 in medication costs, you move into catastrophic coverage and only have to pay 5% of your prescription medication costs
At the end of the year, your limit resets and you move back into stage one.
The Medicare donut hole occurs after you’ve paid a certain amount for prescription medications; it’s the coverage gap between when your co-pay kicks in and when catastrophic coverage occurs.
How to Avoid the Medicare Part D Donut Hole
The Medicare Part D donut hole is an unfortunate gap in coverage. It means you’re stuck paying for your prescription drugs, which can be prohibitively expensive. In fact, many people simply stop taking their medication when this happens, because they can’t afford the cost without their benefits.
But avoiding the donut hole is easier said than done. In fact, legislation is being worked on to help close the gap so more people can avoid the donut hole. Avoiding the Medicare Part D donut hole can only be done by spending less on prescription medication, which for many isn’t possible. There are savings to be had by choosing the generic version of the medication versus the brand name version, and your doctor or pharmacist can help you navigate that.
Other tips to avoid the Medicare donut hole include:
- Choose pharmacies in-network
- Choose a plan that covers the medication you need
- See if you quality for Medicaid, a federal program that helps those with low incomes pay for medication
- Look into Extra Help, a Medicare program that also helps people with low incomes afford their medication
Unfortunately, there’s no donut hole insurance to help you once you’ve reached that payment stage. You may be able to work out a payment play or payment assistance with your pharmacy or prescription manufacturer, but it will help you enormously to choose the right coverage plan from the get-go, if possible.
Last Thoughts On the Medicare Part D Donut Hole
Avoiding the Medicare Part D donut hole is critical so that you don’t have to shell out thousands of dollars for your medication or risk having to forego your medication altogether. By planning out the drugs you know you’ll need for the year and comparing coverage, you may be able to avoid the donut hole.
But for many, unexpected prescription drug needs can exceed their coverage and push them into the donut hole. While efforts are being made to close the gap, your best bet is to carefully monitor your prescription drug spending and choose cheaper alternatives whenever possible.
