Yes, Medicare has eliminated the Part D "donut hole" (coverage gap) as of January 1, 2025. Under the Inflation Reduction Act, the coverage gap is replaced with a new, simplified structure featuring a $2,000 annual cap on out-of-pocket prescription drug costs. Once this limit is reached, you pay nothing for covered drugs for the rest of the year.
Yes, the Medicare Part D donut hole (coverage gap) is officially gone as of January 1, 2025, eliminated by the Inflation Reduction Act (IRA), simplifying coverage into three phases: deductible, initial coverage, and catastrophic, with a new $2,000 out-of-pocket spending cap for covered drugs in 2025.
No, the infamous donut hole — when Medicare beneficiaries with Part D prescription drug coverage had to pay 100 percent of their drug costs until they reached a certain threshold — has closed.
The Medicare Part D donut hole or coverage gap phase of coverage no longer exists as of December 31, 2024. It was the coverage phase after the initial coverage period when you owed a higher or different percentage of the cost of your drugs.
For 2025, major Medicare changes for seniors include a new $2,000 annual cap on out-of-pocket Part D prescription drug costs, closing the coverage gap, and introducing monthly payment options for Part D, alongside expected increases in standard Part A & B premiums/deductibles and new Part D price negotiations for popular drugs, requiring beneficiaries to review plans carefully.
Changes to Medicare prescription drug coverage taking effect in 2026 include an increase to the Part D out-of-pocket limit and to the maximum Part D deductible – and negotiated prices take effect for ten high-cost medications.
The extra $144 added to Social Security usually comes from the Medicare Part B Giveback benefit, offered by some Medicare Advantage (Part C) plans, which pays back some or all your Part B premium, showing up as extra money in your check if it's deducted from your Social Security. To qualify, you need Original Medicare (Parts A & B), pay your own Part B premium, live in a plan's service area, and enroll in a specific Medicare Advantage plan that offers this "rebate," with the amount varying by plan and location.
Ask your physician or pharmacist if there is a generic drug available. Until the generic drug donut hole closes in 2024, check with your insurance to see whether the brand name or generic drug is more cost effective. Or see if there is a similar medication for the same medical condition available at a lower cost.
Medicare Prescription Coverage Updates for 2026
As in 2025, there is still NO Coverage Gap (also known as the “donut hole”). In 2026 the maximum out of pocket spend on covered medications is now $2100/year. o Out of pocket spend will include any prescription plan deductibles.
How do you avoid the Medicare donut hole coverage gap? All Medicare Part D plans come with a donut hole, so the only way to avoid it is to try and stay under the threshold needed to avoid paying a significant out-of-pocket amount for prescription drugs.
Yes, President Biden's administration, through the Inflation Reduction Act (IRA), effectively eliminated the Medicare Part D "donut hole" (coverage gap) starting in 2025, replacing it with a simpler structure that includes a $2,000 annual out-of-pocket spending cap and no further drug costs for the rest of the year once that cap is met.
As of 2025, the Medicare Part D “donut hole” no longer exists – meaning there is no longer a coverage gap during which Part D enrollees face higher drug costs. The “donut hole” was eliminated thanks to provisions of the Affordable Care Act (ACA) and the Inflation Reduction Act (IRA).
It's important to know that starting in 2025, the Part D donut hole is eliminated. Instead, once your out-of-pocket prescription drug costs reach $2,000, you enter the catastrophic coverage phase—and pay nothing for covered medications for the rest of the year.
The Inflation Reduction Act (IRA) signed by President Biden in 2022 will eliminate the Prescription Drugs Coverage Gap (known as the donut hole) for Seniors in 2025. Most Medicare drug plans have a coverage gap (also called the "donut hole").
In the donut hole, you pay a percentage of the cost for your prescription drugs. For generic drugs, you pay 25% of the cost of the drug and dispensing fee, and your plan pays the remaining cost.
The $2,000 prescription cap for seniors is a real benefit from the Inflation Reduction Act (IRA) that began in 2025, setting a limit on out-of-pocket prescription drug costs for Medicare Part D enrollees, meaning beneficiaries pay no more than $2,000 annually for covered medications, with the cap increasing to $2,100 in 2026. This major change eliminates the "donut hole" and provides significant savings for seniors with high drug costs, allowing costs to be spread out monthly.
You enter the catastrophic phase if you've spent a certain amount of money for covered medicines. During this stage, you'll pay nothing for your covered Part D drugs. The Coverage gap phase, known as the Medicare donut hole, was eliminated in 2025 due to changes implemented by the Inflation Reduction Act (IRA).
Your CalPERS health coverage will automatically be canceled the first day of the month after you turn 65. Review Cancellation of CalPERS Health Coverage for information on reinstating your health coverage.
GoodRx can't be used in combination with Medicare, but it can be used in place of Medicare. You may want to consider using GoodRx instead of Medicare when Medicare doesn't cover your medication, when you won't reach your annual deductible, or when you're in the coverage gap phase (“donut hole”) of your Medicare plan.
There could be several reasons why Social Security stopped withholding your Medicare Part B premium. One common reason is that your income has exceeded the threshold for premium assistance. Another reason could be that there was a mistake or error in your records.