1. Will my Medicare benefits change?
2. What is the donut hole rebate?
1. Will my Medicare benefits change?
The law cuts reimbursement for Medicare Advantage (MA) plans. Unlike Medicare, MA plans focus on prevention and care coordination to keep members well. Studies show that MA members spent fewer days in the hospital, were readmitted less frequently, and were more likely to avoid hospitalization for common conditions like uncontrolled diabetes. If government funding for MA continues to shrink, many insurers will discontinue these plans, which cover 37 percent of Pennsylvania’s Medicare beneficiaries.
2. What is the donut hole rebate?
Effective this year, beneficiaries with Medicare Part D who reach the "donut hole" will receive a one-time, non taxable $250 rebate. The donut hole is the gap reached when Part D prescription drug costs go over $2,830. At that point, you are responsible for the entire cost of your prescription drugs (versus making copayments) — at least until your out-of-pocket costs reach $4,550.
In January 2011, Part D enrollees who enter the donut hole will receive a 50 percent discount on brand-name and biologic drugs in the coverage gap.
3. What does it mean to me?
The 50 percent discount will be applied to all brand-name and biologic drugs in the “donut hole.” This can mean significant out-of-pocket savings for you.
In the future: By 2020, the coverage gap will be closed, meaning there will be no more “donut hole,” and you will only pay 25 percent of the costs of your drugs until you reach the yearly out-of-pocket spending limit.