No. The Coverage Gap description provided for Medicare Part D plans is referencing the supplemental coverage some Medicare Part D plans offer their members who reach the Coverage Gap.

The Donut Hole discount - that started in 2011 with the introduction of the Affordable Care Act (ACA) works differently for generic vs brand-name drugs that have Gap Coverage.  When a brand-name drug is purchased in the Coverage Gap, the Medicare Part D plan's Gap Coverage is applied and then the drug manufacturer's portion of the Donut Hole discount is applied.  For generic drugs, only the Gap Coverage is applied.

In other words, all non-LIS Medicare Part D plans members will receive the Donut Hole discount for formulary medications purchased while in the Donut Hole - plus - if your Medicare prescription drug plan provides supplemental Gap Coverage for brand-name drugs, you will receive the drug manufacturer's portion of the Donut Hole discount in addition to the Gap Coverage.

Example of the Donut Hole discount working with supplemental Donut Hole Coverage

As noted in an example from Medicare, "[i]f your Medicare Part D plan offers 60% coverage on brand-name drugs in the coverage gap (you pay 40% co-insurance) and you purchase a brand-name formulary prescription that has a retail price of $100, the cost of your prescription after your plan’s savings is $40.  The 50% [70% starting in 2019] pharmaceutical manufacturer discount is then applied to your $40 portion so that you only pay $20. [Please notice that only the pharmaceutical industry's portion of the Donut Hole Discount is applied since the Medicare Part D plan is already providing additional Gap coverage.]  However, the entire $40 co-insurance paid by you and the pharmaceutical manufacturer will count toward your total out-of-pocket spending (TrOOP) limit and help you get out of the Coverage Gap a little faster."  (source: https://www.medicare.gov/Pubs/pdf/11493.pdf - "Closing the Coverage Gap - Medicare Prescription Drugs Are Becoming More Affordable").

You can read more in our FAQ: "Do I get the Donut Hole discount if my Medicare plan includes Gap Coverage?"

As background, prior to 2015, Medicare would provide a description of the Donut Hole coverage provided by the plan--when the Medicare Part D plan designs were introduced each year.  The descriptions provided by Medicare were "qualitative" in nature and did not actually reflect the exact number of formulary drugs that a Medicare Part D plan might cover in the Donut Hole.

For instance, here is how Medicare described the different types of Donut Hole coverage in 2013 and 2014.

Gap Coverage Types and Minimum Premium for 2014 Part D Plans
2014 Gap Coverage Details Gap Coverage Type Nbr. Plans Min. Prem. No Gap Coverage 891 $12.50 Few Brands 34 $41.00 Some Generics 15 $52.20 Call Plan for details 34 $55.40 Many Generics 14 $69.30 Some Generics, Some Brands 77 $77.60 Many Generics, Some Brands 71 $97.40 Many Generics, Few Brands 1 $99.70 Few Generics 32 $108.40	2013 Gap Coverage Details Gap Coverage Type Nbr. Plans Min. Prem. No Gap Coverage 698 $15.00 Many Generics 66 $34.00 Some Generics 69 $47.90 Few Generics 32 $65.80 Some Generics and Some Brands 93 $79.30 Some Generics and Few Brands 1 $83.90 Many Generics and Some Brands 77 $86.20 Many Generics and Few Brands 3 $88.80 All Generics 6 $88.90
Notes: Click the Gap Coverage Type above to see plan details in California or choose your state.

We then added the following explanation to this table:

Gap coverage descriptions apply to formulary drugs only. The Healthcare Reform provides that for Plan Year 2012, ALL formulary generics will have at least a 14% discount and ALL brand drugs will have at least a 50% discount in the coverage gap. The Gap Coverage Types discussed in this section are in addition to the Healthcare Reform mandated discounts. The percentage of "Generic" and "Brand" drugs covered in the gap are each separately calculated and the following descriptions are used:

• "All": 100% of formulary drugs of this type (generic or brand as noted) are covered through the gap. Ex: "All Generics". A label of "All Formulary Drugs" is applied for plans that cover 100% of "generic" and 100% of "brand" products (either by covering all formulary drug products in the gap or by having no initial coverage limit),
• "Many": >=65% to <100% of formulary drugs of this type (generic or brand as noted) are covered through the gap. Ex: "Many Generics",
• "Some": >=10% to <65 % of formulary drugs of this type (generic or brand as noted) are covered through the gap. Ex: "Some Generics",
• "Few": >0% to <10% of formulary drugs of this type (generic or brand as noted) are covered through the gap (and must also be >15 products covered through the gap),
• "No Gap Coverage": 0% of drugs are covered through the gap (or <=15 products covered through the gap)

However, starting in 2015, Medicare changed the Medicare Part D plan descriptions and now CMS only provides an indication of Medicare Part D plans with (or without) some form of additional Donut Hole coverage.


At any rate, all Medicare prescription drug plans, even if the Part D plan's gap coverage states “No Gap Coverage” -- are required to give both the generic and brand-name discounts on all formulary drug purchases made while in the Donut Hole (Coverage Gap).

You can learn more here: The Donut Hole and Beyond