Medicare Coverage Gap

Coverage Gap to illustrate supplemental protection needed for your insurance policy

Medicare Part D Prescription Drug Plans have a coverage gap which is also known as the “donut hole,” and means there is a temporary limit on what the prescription drug plan will cover for the cost of prescription drugs. The coverage gap is entered once you and your health plan have reached a pre-set payment total for your prescription drugs. After that total is met, you may have to pay more for your prescription drugs, until you reach an out-of-pocket threshold. In 2017, the coverage gap starts when you and your plan have paid $3,700 on covered prescription drugs. The out-of-pocket spending limit in 2017 is $4,950. The coverage gap works differently for brand name prescription drugs than it does for generic prescription drugs and there are some items that don’t count towards the coverage gap, for example, the prescription drug plan premium. You can find more details at Medicare.gov.

Even though Darrin and his plan spent over $3,700 this year on prescription drugs, he was relieved to find out his plan offered a higher savings while he was in the coverage gap.