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More than 3 million Seniors will fall into Donut Hole next year

More seniors than ever are expected to fall into the Medicare Part D “donut hole” next year, the coverage gap in which beneficiaries must pay the full cost of their prescription drugs. 

More than 3 million out of 24 million Part D enrollees will have to pay $4,050 in out-of-pocket expenses, including deductibles and co-pays, before Medicare will offer catastrophic coverage and pay for 95% of prescription drug costs. 

This is a $200 increase over the $3,850 in out-of-pocket expenses required for catastrophic coverage to occur this year.  Medicare will pay 75% of prescription costs up to $2,510 in 2008, up from $2,400 in 2007. 

However, total drug costs must reach $5,726 next year, up from $5,451 in 2007, before the catastrophic coverage kicks in.  “Between rising premiums, fewer prescriptions being covered, and the growing donut hole, seniors will pay more for their drugs on every front next year,” said Edward Coyle, Executive Director of the Alliance.