The Affordable Care Act: closing the medicare donut hole

According to the Federal government,  in 2010 roughly 97,800 Medicare beneficiaries in Georgia hit the doughnut hole, or gap in Medicare Part D drug coverage.

If you're one of these people, you'll have received no extra assistance towards the cost of your prescription drugs.

The doughnut hole opened when enrollees’ total 2010 drug spending—including out-of-pocket costs and expenses covered by their Medicare drug plan—reached $2,830.

At this point, enrollees paid the full cost of all the prescription drugs they need until total expenses hit $6,440, at which point they qualified for catastrophic coverage and paid 5 percent of drug costs.

Under the Affordable Care Act, Medicare recipients in Georgia who hit the Medicare Part D drug coverage gap since 2010 have automatically been mailed a one-time $250 rebate check.

The new law plans to provide additional discounts for seniors on Medicare in the years ahead and "completely closes the donut hole by 2020".

If the health care reforms are reversed by the legal challenges underway, seniors could be penalized up to $1,500 a year (see chart).

The effects of this change are reported here.