Medicare Part D 2008 Data Spotlight: The Coverage Gap

This Medicare Part D data spotlight examines the coverage gap, or “doughnut hole,” in Medicare drug plans available in 2008. Part D enrollees (other than those receiving low-income subsidies) will reach the coverage gap after they incur $2,510 in total drug costs in 2008. At that point, enrollees are required to pay 100 percent of drug costs until they qualify for catastrophic coverage.

The analysis finds that in 2008, more than a quarter of stand-alone Part D plans and half of Medicare Advantage plans will offer some type of gap coverage. Among those that do offer some coverage in the gap, the gap coverage is mainly for generic drugs. Nationwide, only one stand-alone drug plan and 16 percent of all Medicare Advantage drug plans offer coverage for at least some brand-name drugs in the gap. The spotlight also looks at enrollment in plans with gap coverage, as well as trends in the availability of gap coverage over time.

The spotlight is one in a series analyzing key aspects of the Medicare Part D drug plans that will be available to beneficiaries in 2008. The analysis was conducted jointly by Jack Hoadley and Jennifer Thompson of Georgetown University, Elizabeth Hargrave and Katie Merrell of NORC at the University of Chicago, and Juliette Cubanski and Tricia Neuman of the Kaiser Family Foundation.

Data Spotlight (pdf)