Around $1,983.75 - maybe even a little more depending on your Medicare Part D plan.

Your actual savings in the 2012 Donut Hole will depend on several things including: (1) how much you spent personally before reaching the Donut Hole and (2) how much you spend on generic drugs or name-brand medications while in the 2012 Donut Hole (remember that while you are in the 2012 Donut Hole, you will receive a 14% discount on generic drugs and a 50% discount on name-brand drugs - but, you will receive full 100% credit for the name-brand drug purchases toward meeting your 2012 out-of-pocket threshold limit (or TrOOP) of $4,700.

So, to make our lives easier, we will assume: (1) that your Medicare Part D plan has a $0 Initial Deductible and (2) your plan has a standard or average 25% co-insurance cost-sharing structure (this means that you pay 25% of the cost of a medication and the plan pays the other 75%), (3) you are purchasing only name-brand medications while in the Donut Hole, and (4) you spend your way through your entire Coverage Gap or Donut Hole by meeting the $4,700 out-of-pocket or TrOOP threshold, the amount that you could save would be around $1,983.75 (or 50% of $3,967.50).

• Your 2012 Medicare Part D Initial Deductible: $0 (no deductible).
  
• The standard 2012 Initial Coverage Limit: $2,930 (or the total retail drug cost).
  
• You have a 25% cost-sharing - so, of the $2,930, you pay (.25)($2,930) = $732.50 during the Initial Coverage phase.
  
• The remaining balance you need to reach the 2012 Donut Hole exit point or TrOOP threshold of $4,700 is ($4,700 - $732.50) = $3,967.50.
  
• If you only purchase $3,967.50 in name-brand drugs while in the Donut Hole you get the 50% Donut Hole discount on the purchase, so you pay (.50)($3,967.50) = $1,983.75 --- but get credit for the full $3,967.50, so meeting the $4,700 TrOOP threshold or Donut Hole exit point.

However, if you had a standard 2012 deductible of $320 along with the standard 25% cost sharing (such as with the EnvisionRxPlus Silver Medicare Part D plan) --

• Your 2012 Medicare Part D Initial Deductible is: $320.
  
• The balance of your 2012 Initial Coverage Limit is: $2,930 (total retail drug cost) - ($320, the amount you already paid in the deductible) = $2,610.
  
• You have a 25% cost-sharing structure - so, of the remaining $2,610 in retail drug costs, you pay (.25)($2,610) = $652.50 before your total retail drug purchases reach $2,930.
  
• The total you pay out-of-pocket before reaching the 2012 Donut Hole or exceeding your retail drug purchases of $2,930 is: ($320 + $652.50) = $972.50.
  
• The remaining balance to reach the 2012 Donut Hole exit point or TrOOP threshold of $4,700 is then ($4,700 - $972.5) = $3,727.50.
  
• If you only purchase $3,727.50 in name-brand drugs you get the 50% Donut Hole discount, so you pay (.50)($3,727.50) = $1,863.75 -- but get credit for the full $3,727.50 -- so meeting the $4,700 TrOOP threshold or Donut Hole exit point.
  

Examples of 2012 Medicare Part D plans that have a $320 Initial Deductible and a standard 25% Co-insurance rate:  EnvisionRxPlus Silver in all states (example: S7694-01 in ME and NH), BravoRx (PDP) in 25 Medicare regions (example: S5998-001 in NY), HealthSpring Prescription Drug Plan in all states (example: S5932-001 in AL and TN), Simply Prescriptions Rx 1 in NY  (5-Star plan) (S3521-001), PharmaPlus in PR (S5840-001), MCS Classicare Rx Standard  in PR (S5555-003), and AmeriHealth Rx Option I  in PA and WV (S2321-005).  You can find these plans and view plan details with our 2012 PDP-Finder: https://q1medicare.com/PartD-SearchPDPMedicare-2012PlanFinder.php?state=FL.

Please note:  If your 2012 Medicare Part D plan has an average cost-sharing structure of lower than 25% (you pay less than $25 for a $100 drug purchase), then you will save even more money with the 2012 Donut Hole discount when you reach the Donut Hole or Coverage Gap, because you will have more of your total out-of-pocket costs falling into the 2012 Donut Hole where you get the 50% name-brand Donut Hole discount.

As a second note, you might recall, 2011 was the first year when Medicare beneficiaries received a discount on medications that they purchased while in the Donut Hole (or Coverage Gap) portion of their Medicare Part D prescription drug plans.  (Some people might also remember that in 2010, they received a $250 Medicare rebate check when they reached their 2010 Donut Hole.)  For more information, you can click here to see how the Donut Hole discount increases over the next few years until the discount reaches 75% and the Donut Hole is considered “closed”.

See our FAQ for examples of the maximum Donut Hole Discount savings for other plan years.