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Millions Face Medicare Prescription Coverage Gap

Location: Washington, DC

Millions Face Medicare Prescription Coverage Gap

Nearly 80 Percent of Newly Enrolled in California to Lose Benefits

Millions of seniors and disabled who enrolled in the Prescription Drug Medicare Part D program now face the prospect of having to pay the full cost of their medicine.

Coverage stops under most programs when the total cost for drugs exceeds $2,250 for the year. Those beneficiaries must pay all of their prescription medicine costs until their annual outlay reaches $5,100.

"This coverage gap - the so-called doughnut hole - is both irrational and unfair," said Congressman Brad Sherman. "I will continue to fight for improved and simplified prescription drug coverage under the Medicare program so that seniors may get the drugs they need."

The coverage gap puts at risk 88 percent of those who signed up for the prescription drug benefit who are not eligible for extra help, according to a new House study.

There are 299,396 seniors and disabled workers in California -- 79 percent of newly enrolled Medicare Part D beneficiaries -- at risk of falling into the gap, according to the report by the House Ways and Means Committee Democratic staff.

The report also found that only 20,263 new enrollees in California gained full, uninterrupted coverage through expensive plans with premiums that were 270 percent higher on average. In addition, low-income beneficiaries may receive extra help that eliminates the gap.

Unless the law is changed, the $2,850 coverage gap is projected to more than double the cost that many seniors could have to pay for their prescriptions to $6,730 by 2016.

House Democrats have offered an alternative plan to fix the new prescription drug program that is simple, affordable and reliable. It would simplify the Medicare drug benefit and require Medicare to use its bargaining power to negotiate lower drug prices. The savings would be used to fill the doughnut hole, and decrease out-of-pocket expenses for prescription drugs.

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