|The example below shows calendar year costs for covered drugs in a plan that meets Medicare's standards in 2007:
Mr. Jones joins the ABC Prescription Drug Plan. His coverage begins on January 1, 2007. He pays the plan a monthly premium throughout the year, even during his coverage gap. He doesn't get "extra help."
|3. Coverage Gap
|Mr. Jones pays the first $265 of his drug costs.||Mr. Jones pays a copayment or coinsurance amount, and his plan pays its share for each drug until his total drug costs (including his deductible) reach $2,400.||Mr. Jones pays everything until he has spent $3,850 out-of-pocket. (This includes his yearly deductible, coinsurance and copays, and $3,051.25 while in the coverage gap. This does not include the drug plan's premium.) Even though he is paying everything, he gets a discount because he belongs to a Medicare drug plan.||Once Mr. Jones has spent $3,850 out-of-pocket for the year, his coverage gap ends. He only pays a small coinsurance (like 5%) or a small copayment (like $2.15 or $5.35) for each prescription until the end of the year.|