Medicare Part D Donut Hole Closure Saved

Part D Prescription Drug PlanOne of the provisions in the Affordable Care Act (ACA) is the reduction in cost sharing while you are in the Medicare Part D do-nut hole and closing the hole.

Sitting on the edge of my seat waiting to hear what the outcome would be regarding the repeal and replace of the ACA.  It was such a relief know the vote for repeal and replace was canceled and those on Medicare wouldn’t be hurt.

History of The Part D Prescription Plan

Originally, the Part D Plan was setup to have an annual deductible and once that had been met the government pays 75% of your prescriptions and you are responsible for 25% co-payment until you reach the limit on what the drug plan will cover for drugs, then you fell into the do-nut hole.

This became very expensive for people and they were required to pay 100% of the drug costs until they reached the catastrophic phase.

I know people who use the insulin pens and they are very expensive. Those prescriptions can put them in the “hole” within 4-5 months. Now try and purchase those pens at 100% cost and you are looking at about $400+/- per month for the next 5-8 months.

This is How The ACA Helps Medicare Part D

By the year 2020 there will be a standard 25% co-payment for brand-name drugs and 25% for generics when you reach the do-nut hole, thus closing the “hole”.

The percentage has been decreasing since the implementation of the ACA and in 2017 once you and your plan have spent $3,700 on covered drugs, you’re in the do-nut hole. If you reach the hole you will pay a 40% co-payment for brand-name drugs and 51% for generics.

The Reduction Schedule for The Next 4 Years

  • 2017 — 40% for brand-names – 51%  for generics
  • 2018 — 35% for brand-names – 44% for generics
  • 2019 — 30% for brand-names – 37 % for generics
  • 2020 — 25% for brand-names – 25% for generics

Looking forward to 2020 when the do-nut hole will be closed!

The ACA protects Medicare and Medicaid and if the repeal and replace of the ACA went through, this is what would have happened:

  • $880 billion in cuts to Medicaid
  • $170 Billion in cuts to Medicare funding
  • Medicare Part B premium increases

If you hear repeal and replace Obamacare, think of the Medicare loses that would affect you.

 

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