Question: Isn't the Donut Hole closed?
Yes, but . . . Although we say that the Donut Hole "closed" since you receive a 75% discount on all formulary drugs purchased in the Donut Hole, but the Coverage Gap remains the third phase of your Medicare Part D coverage. So you will leave your Medicare Part D plan's Second Phase or Initial Coverage Phase once your retail drug costs exceed the Initial Coverage Limit. And when you leave your Initial Coverage Phase, you will enter the Coverage Gap (Donut Hole) where the cost of your formulary medications can actually increase, decrease, or stay the same - depending on your Medicare plan, your cost-sharing, and the drug's retail price (see the examples below for more information).
Remember: The Donut Hole entry point changes each year.
The amount of prescriptions you can purchase before entering the Donut Hole will vary each year with the annual changes to the plan's Initial Coverage Limit. For example, the 2019 Initial Coverage Limit was $3,820, so you enter the 2019 Donut Hole if your average negotiated retail drug purchases exceed $319 per month - so you could spend more in 2020 as compared to 2019 before entering the Donut Hole.
Please note that each year, some Medicare Advantage plans provide prescription coverage with different Initial Coverage Limit values.
In other words, depending on your Medicare prescription drug coverage (stand-alone Medicare Part D plan or Medicare Advantage plan that includes drug coverage), you may enter the Donut Hole or Coverage Gap a little earlier than someone who uses the same medications, but is in another Medicare plan.