Senate Democrats

Closing the Donut Hole

At a press conference at the Capitol this week, Senate Majority Leader Harry Reid said that seniors were some of the "biggest winners" in the health care reform legislation.    Of the many benefits that the Patient Protection and Affordable Care Act provides seniors, one of the most critical improvements is the $250 rebate for those who fall into the ‘donut hole.’   The Medicare prescription drug program’s ‘donut hole’ has caused seniors a significant amount of confusion and distress. When the Medicare prescription drug program (‘Part D’) was created in 2003, Congressional Republicans made a key decision to reduce the cost of the bill. Seniors are required to pay 100 percent of the cost of their prescription drugs, once they reach the initial coverage limit, and until they reach the point at which their spending hits what is known as the ‘catastrophic amount.’ This gap is referred to as the donut hole.    Without health reform, the coverage gap could have exceeded $6,000 by 2019. The effect of this gap in coverage has been catastrophic for many seniors. According to one estimate, once seniors enter the donut hole, 15 percent stop taking their medication, and 57 percent of them remained off their medication.    The health care reform law fixes this problem, providing seniors a $250 rebate check when they hit the donut hole this year. Beginning in 2011, the law institutes a 50% discount on brand-name drugs in the donut hole. This legislation will completely close the gap by 2020.    In response to Republican demands to repeal this law, Senator Robert Menendez said, "It is always on the wrong side of history to take away a right that already exists. I want to say to my colleagues who not only want to impede our improvement of the bill but who say they want to repeal it: Do you want to take away from seniors the immediate relief they will get this year or the relief they will get from closing that prescription drug coverage gap. Repeal is not esoteric. Repeal is about taking away those rights that as of [the bill’s signing] existed."