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Medicare Drug Coverage Doughnut Hole Is Troubling

Ruzanna Harutyunyan's picture

The effect of the "notorious 'doughnut hole'" in Medicare Part D plans is "very troubling" for beneficiaries with serious chronic health conditions, a New York Times editorial states. The so-called doughnut-hole spending gap takes effect when total drug spending for an individual reaches $2,400 for a single year and continues until total out-of-pocket spending reaches $3,850 in that year, at which point the beneficiary receives catastrophic coverage.

According to an analysis recently conducted by the Kaiser Family Foundation, Georgetown University and NORC at the University of Chicago, 3.4 million Medicare beneficiaries reached the coverage gap in 2007.

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The Times states that it is "disturbing" that across eight classes of drugs studies, 15% of the beneficiaries halted their medication when they reached the gap. The Times notes that an additional 1% of beneficiaries who reached the spending gap reduced the number of drugs they were taking and 5% switched to less-costly medications. The editorial continues that the health consequences for the 10% of diabetics who stopped their medication after reaching the coverage gap "could be immediate and serious," while the harm to beneficiaries with other chronic conditions -- such as high cholesterol or osteoporosis -- "could take longer to show up but could still be serious."

According to the Times, "There is no easy solution short of increasing federal spending or finding a way to drive down the cost of drugs." However, the editorial concludes, "The next administration and Congress will have to revisit the wisdom and need for the gap" (New York Times, 9/2).

Reprinted with permission from kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign up for email delivery at kaisernetwork.org/email . The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation. © 2007 Advisory Board Company and Kaiser Family Foundation. All rights reserved.