Surviving the Doughnut Hole – Medicare Part D | Health Care

Surviving the Doughnut Hole – Medicare Part D

Published January 07, 2009 @ 05:08PM PT

Prescription drug coverage for Medicare seemed like such a worthy goal back in 2000. But a few years into the program, it's obvious that we've completely screwed it up. It's given rise to a practice that's so bizarrely punitive, so absurd in logic, that it plays like a sadistic version of "Who's on First?" It's called the Coverage Gap, but you may know it by its other name - "The Doughnut Hole."

And that's really saying something. The Medicare Prescription Drug, Modernization and Improvement Act took our social-insurance program for the elderly and disabled and turned it into a bureaucratic mess.

Medicare beneficiaries who wish to use the benefit have to choose 1,824 plans administered by the private insurance industry to choose from, each with its own deductible rules and tiered co-pays or coinsurance, and each with its own list of drugs it does or does not cover. There is no default - choose, or be assigned one at random. Even more bizarre, the government completely waived its right to negotiate with the plans for the lowest prices or encourage the use of generics - which is why users of Medicare Part D spend 58% more on prescription drugs than the Dept. of Veteran's Affairs, which does negotiate for low prices. (Do I even need to mention that the VA uses a single-payer system, while Medicare Part D uses private plans?)

But the "doughnut hole" takes the cake (no pun intended). Every year, there's a new magic number for the total dollars in prescriptions that you'll be covered for. In 2008, that number is $2,700. When you hit $2,700, you were stuck paying for the rest of your prescriptions out of pocket until either a.) January 1, 2009 rolled around, b.) you reached over $4,000 in out-of-pocket expenses, at which point you gained new "catastrophic coverage" or c.) you died.

We learned in today's WSJ Health Blog that Medicare had been counting the costs for the pharmacy-benefit managers, who act as the administrative go-betweens from the insurance companies to the pharmacies, as though that was money that went directly to prescriptions. The good news is Medicare has a new rule to exempt these administrative costs from the limit. The bad news is that rule doesn't go into effect until 2010.

The "doughnut hole" only affects 25% of Medicare Part D beneficiaries - but what economic agony for those who hit it! It's sadly common for those in the doughnut hole to stretch out their medication by rationing to half or a third of the recommended dose for the rest of the year, or going off meds entirely. Christopher, a reader of this blog, shared his story with me. He hit the doughnut hole on March 21 of last year. "I'm on disability for a heart condition," he said, "and last year from March through December, I paid anywhere from $270 a month to $1500 a month depending on the mix of drugs my cardiologist put me on." Chris never made it to the "catastrophic coverage" in 2008.

Here's the kicker - he's only 41 years old, on Medicare because of disability. "I thought something like this would never happen to me until I was retired, not in my prime. It is stressful for someone my age, so how a retired person does it... it must be even scarier for them."

Congress and the Obama team have promised to fix the doughnut hole and reform the Medicare prescription drug benefit. Now's the time to hold them to it. Take our pledge to Support Fair and Equitable Drug Pricing for All.

(Photo credit: macwagen on Flickr.)

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Comments (7)

Thank you, thank you...on behalf of all the Medicare patients we care for who do not even understand their benefits because they are so complex; many cannot afford their drug copays but because they have Medicare are ineligible to receive Pharmaceutical assistance through Patient Assistance Programs; major reform needed- and greatly appreciated- NOW.

Posted by Dr Mary Zennett on 01/07/2009 @ 08:02PM PT
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This entire health care/insurance system is so complicated that an ordinary citizen would need several consultants to understand/ Why can't we have a single payer system...Medicare for all, which would eliminate counless intermediaries who do nothing but crete trouble for people who really need care. I have nothing against preventive medicine and education as a way to healthy life-style but we all eventually get some sickness and die, even is we are healthy ;-)! The point is to eliminate fear, which many Americans have when sickenss comes and the hospital prices may eliminate life-savings even when on has a health "insurance".

Posted by Vlasta Molak on 01/11/2009 @ 07:21PM PT
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I agree with your philosophy, but the current Medicare system is highly regulated and currently has absolutely minimal provisions for real preventative care; in fact many of the doctors who support single payer health care are not supportive of wellness or preventative care, which would help keep us healthy and save probably billions in health care costs; I think we need to move from illness to wellness first, and then tackle the payer issues; you are absolutely correct, however, we should not need advance degrees to read our health insurance claims; I am a big proponent of simplifying the system, which has gotten so cumbersome; the patient, regrettably gets lost in the health care equation- thanks for your insights!

Posted by Dr Mary Zennett on 01/11/2009 @ 08:14PM PT
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I had a patient today who was upset because she has Medicare, yet could not get her prescriptions filled- including some generic meds on the $4 Walmart list! Since it is Sunday, we couldnt call to figure out what the problem was, but this Medicare Part D really needs some patient-centered revisions.

Posted by Dr Mary Zennett on 01/11/2009 @ 08:17PM PT
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I agree with Dr Mary, however to say that Medicare really needs some "patient-centered revisions" is putting it mildly...it needs a complete overhaul. And it's not just Part D, Part B is getting astronomical as well. A little research and you can call SS and ask them should you retire today how much would make and what benefits you are entitled. People between the ages 30 and 55 need to know that a 10 minute phone call will reveal that in the year 2000 Medicare Part B - Medical was a mere $50 a month. In less than a decade it has more than doubled. That means right now (today) part B is costing you over $1200 a year...just think how much it will be in 25 - 40 yrs. when you retire. The single payer system would be better than what we have now.

Posted by Chris . on 01/12/2009 @ 07:17AM PT
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But wait, my story takes more cake....
I've been double and triple enrolled in Part D. Community CCRX refuses to acknowledge this but I've unfortunately for them got ALL the numbers. I have a ghost account at Social Security, tied into a Medicare Part D account at Community CCRx. Top that with the fact that this Medicare Part D account is subsidized by my state ( South Carolina- who yes has a big budget crisis too).
I've reported this, but because I also have proof that my surrendered disability account was left in pay the entire 11 years that I worked before I got sick again with my lifetime illness, ALL investigations have been stopped. I am telling you the FBI was stopped from investigating. The Secret Service was stopped.
I've also got a fraudulent Inspector General Report issued by the Deputy Chief Council for External Relations at SSA. That report says the HHS OIG passed on looking into these matters. It implicates the fact that the Medic, the private contractor for the OIG monitoring these drug plans is not honest.
I reached the donut hole in Feb of last year. I was out in May. I hit the 10,000 mark.
I am being threatened with termination of my REAL policy because of this ghost policy that gets a subsidy and costs nothing.
AND SOMEONE SHOULD PICK UP ON THIS FACT AND HELP ME GET HELP>

I believe the Social Security and Medicare Trust Funds were drained last year. For the first time since the Trustee positions, established to oversee the fund in 1984, were created, there were no Trustees.
Considering I just told you that someone received money from SSA in my name for fifteen years, and considering I have an internal use only document that says another terminated SSA account out of the same office is still paying at the twenty year mark.... do ya reckon, it's just probably possible, that it's not a coincidence that my former employer's retirement system had a fraudulent account going on me too.....

The head of Fidelity Investments, where this fraudulent retirement account is being maintained, is where the Social Security privatization GO TO MAN used to be the head.

I'm thinking Fidelity is holding all the stolen Trust Fund money... that is if AIG didn't have a right good bit of it too.

I have over 3000 pages of details........

Posted by Liz Shepherd on 01/28/2009 @ 07:00PM PT
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While the FDA considers re-importation illegal, they aren't stopping anyone from doing it. A company my mom uses is www.canamericaglobal.com they have some pretty great pricing.

It's a shame and a scam that people have to fall into this donut hole, I pay for my moms prescriptions, her first year on Part D cost me about $2200, this last year using the company I mentioned above, I've only spent $875 so far and she was given another medication this last year. Right now, she has a supply to last her until February!

Posted by Dale Carriere on 11/19/2009 @ 01:51PM PT
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Tim has been an online organizer and blogger on health care policy for the Obama for America campaign (during the primaries) and currently for the Committee of Interns and Residents/SEIU Healthcare, a labor union for intern and resident doctors. Views expressed here are Tim's, and don't represent the positions of CIR or SEIU.