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Author: Admin | 2025-04-28
And coming changesWith Medicare Part D, after your prescription drug expenses equal $5,030 (in 2024), your coverage is reduced until another threshold is met: $8,000. Within this gap, known as the “doughnut hole,” you’re responsible for paying up to 25% of the cost for covered brand-name and generic drugs. The increase in out-of-pocket costs can strain the budgets of those who take multiple or expensive medications and have limited incomes.After your expenses hit $8,000, full coverage resumes.Although the doughnut hole remains in place through 2024, it will disappear the next year because of changes included in the Inflation Reduction Act of 2022. Starting in 2025, a cap will limit annual drug costs to $2,000. After meeting that threshold, any additional covered medications won’t cost you a dime.The bottom lineMillions of seniors 65 and older rely on Medicare Part D to help manage prescription drug costs, which can be substantial. Enrolling in Part D requires that you either have Part A or Part B. Failing to enroll when you first become eligible may result in a permanent fee added to your monthly premium. Some Medicare Advantage plans include prescription drug coverage, eliminating the need to purchase Part D separately.Changes to the Part D program will eliminate the “doughnut hole” that many beneficiaries fall into, which results in much higher coinsurance costs until their out-of-pocket expenses reach a certain amount. The doughnut hole will disappear starting in 2025. The new rule caps annual drug expenses at $2,000, providing more financial relief for seniors with high prescription drug expenses. As with any financial product, review and compare your prescription drug plan choices and ask questions to find the best deal for your insurance dollars.ReferencesDrug Coverage (Part D) | medicare.govPart D Improvements | cms.govJoining a Plan | medicare.gov
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