My pharmacist mentioned the Medicare "donut hole" is going away in 2025. What does that actually mean for me?

Question

Steven Bleicher · Accepted Answer

Last year, before the Inflation Reduction Act kicked in, the most anyone would spend for their annual prescription drug cost was $8,050.00.

Now that 2025 has arrived, with the elimination of the "donut hole", the most anyone will be spending for either their cumulative generic or the brand name drugs they're prescribed is a maximum of $2,000.00. This is tracked by Medicare and the approx. $6K savings is going to be a boon to those without secure finances.

Melonie Wood · Answer

The "donut hole" (or coverage gap) in Medicare Part D prescription drug coverage is being eliminated in 2025, meaning once your out-of-pocket costs reach $2,000, you won't pay anything for covered medications for the rest of the year.

Answered by Melonie Wood on April 4, 2025

Agent Licensed in FL & AL

Answered by Melonie Wood Medicare Insurance Agent

Ben Washington · Answer

Donut hole going away means that your cost will be less that last if your drugs cost was higher enough for you to get into the donut hole.

Alondra Arce · Answer

Yeah, the donut hole's going away in 2025, which is great news. Basically, it means there's gonna be a $2,000 cap on how much you have to spend out of pocket for your meds each year under Medicare Part D. After you hit that, you don’t have to pay for your prescriptions for the rest of the year. So no more weird coverage gap where things suddenly got super expensive halfway through the year.

Answered by Alondra Arce on April 14, 2025

Agent Licensed in CA, AL, AR & 14 other states

Answered by Alondra Arce Medicare Insurance Agent

Alison Hummel · Answer

It means the government has put a $2000 cap on out of pocket spending for beneficiaries when they are purchasing on-formulary drugs on their prescription drug plan.

Misty Scaggs · Answer

This means that once you have paid $2,000 out of pocket, you will no longer be responsible for copays, deductibles & coinsurance for your covered prescriptions for the remainder of the calendar year.

Timothy Brown · Answer

Unlike last year, the annual cost of prescriptions are capped at $2,000 which is the catastrophic limit for 2025. This is good news for recipients that are taking multiple and/or brand name prescriptions. Once the $2,000 out of pocket cost are met, the recipient will receive the remainder of the drugs at $0 for the rest of the year.

Answered by Timothy Brown on April 8, 2025

Broker Licensed in PA, CT, DE & 15 other states

Answered by Timothy Brown Medicare Insurance Agent

Yasmery Vargas · Answer

The maximum out of pocket for prescription was reduced to $2000 a year. Once the $2000 has been met between you and your insurance company, your prescriptions would be covered. It will reset every year.

Answered by Yasmery Vargas on April 15, 2025

Agent Licensed in PA

Answered by Yasmery Vargas Medicare Insurance Agent

Chad Watkins · Answer

The coverage gap known as the "donut hole" no longer being in effect means that instead of needing to pay different copay amounts after reaching a certain level, you will now pay nothing for prescriptions after your out of pocket expense has reached $2,000.

Answered by Chad Watkins on May 14, 2025

Agent Licensed in NJ, AK, AL & 48 other states

Answered by Chad Watkins Medicare Insurance Agent

Deb Haley · Answer

Starting in January of 2025 there is no longer a coverage gap (donut hole) which was formerly stage 3 Medicare prescription pricing. Instead it has been replaced by a $2,000 per year maximum copay amount. Once you have reached that maximum your co-pays will be $0 for your medications listed on your plans formulary for the remainder of that calendar year.

Answered by Deb Haley on April 17, 2025

Broker Licensed in MA, CT, FL & 10 other states

Answered by Deb Haley Medicare Insurance Agent

Dionisio Guillermo · Answer

It means that once you reach your deductible, you will only pay a small copayment for your prescriptions. It gives relief financially to those with high medication costs.

Denise Berg · Answer

The donut hole has disappeared  as of 01/01/2025.
Your yearly out of pocket prescription costs are capped at $2,000.

Matt Vinez · Answer

For those who have high priced meds, and typically have high expenses, your coverage got significantly better. Your max RX spend each year will be $2000, assuming everything is on your plan's formulary.
For those with low to mid RX spends, your coverage likely is getting worse. You'll frequently see higher copays, RX deductibles, and higher co-insurance levels. This will cause more of you to hit the $2000 max as well.
Finally, in an effort to contain costs, some carriers opted to move to a direct sale method, rather than selling through local brokers, which could cause a decline in qualify for customer service.

Fred Manas · Answer

The "donut hole" in Medicare Part D, a period where you paid a higher percentage of your prescription drug costs, is being eliminated in 2025. Instead, there will be a new out-of-pocket spending cap of $2,000, and once you reach that limit, you won't pay anything for covered prescriptions for the rest of the year. 
Here's a more detailed breakdown:
What was the "donut hole"?
It was the coverage gap in Medicare Part D, where you had to pay a higher percentage of your prescription costs after your plan had paid a certain amount towards your medication. This could lead to unpredictable and potentially high out-of-pocket expenses. 
What's the new out-of-pocket cap?
In 2025, your annual out-of-pocket costs for covered prescription drugs will be capped at $2,000. 
What happens after you reach the $2,000 cap?
Once you reach that limit, your costs for covered prescriptions will be $0 for the rest of the year. This means you won't have to pay any copayments or coinsurance for covered drugs. 
How will this affect me?
This change should make your prescription drug costs more predictable and manageable, especially if you have chronic conditions and need ongoing medications. 
What about other changes to Medicare in 2025?
Besides the elimination of the donut hole, there are also changes to Medicare Part A and Part B premiums and cost-sharing, and adjustments to income-related premium surcharges. 
In essence, the elimination of the donut hole and the implementation of the out-of-pocket spending cap aim to simplify Medicare Part D coverage and make it more affordable for beneficiaries like you.

Gary Henderson · Answer

Simple answer is the most you will pay for medications in a single year is a max of 2000.00. 
Law took effect January 2025, signed by Joe Biden in 2023, Trump claims he did it, but it was passed by congress in 2023.

Steve Brauer · Answer

In easy-to-understand terms, you are only responsible for up to $2000 in Prescription Drug costs on formulary medications. In previous years, you were responsible for part of the Prescription Drug costs up to $5030, and then the Donut Hole, or Coverage Gap, began. Then a formula ensued where between what you paid and the Prescription costs reached $8000, you would enter the Catastrophic phase and you portion was finished for the calendar year.

Answered by Steve Brauer on April 8, 2025

Broker Licensed in AZ & CA

Answered by Steve Brauer Medicare Insurance Agent

Andrew Kramer · Answer

That's old news! It was part of the IRA (Inflation Reduction Act) last year, under the Biden admin. It means that you will only pay whatever co-pays your Rx's cost you during the year. And you can never pay more that a total of $2,000/yr for all your Rx's. So for example, in 2024, say you were taking Ozempic with a $47 co-pay on your plan, but once you hit the donut hole of $5,080 total retail cost of Ozempic, which happened fast because it's retail cost was $1,250, you then had to pay 25% of the retail cost of Ozempic for the balance of the year! That's no more. But if you don't take any brand name Rx's you never hit the donut hole anyway.

Answered by Andrew Kramer on June 8, 2025

Agent Licensed in FL

Answered by Andrew Kramer Medicare Insurance Agent

David Christian · Answer

It means there is no longer a period where you may possibly pay a higher coinsurance or copay for your prescriptions.  Medicare Part D is not overly complicated, but it has 3 distinct phases that are important to understand.  There were 5 previous to 2025, but the Coverage Gap aka Donut Hole phase has been eliminated.

1.  Deductible Stage - you are responsible for 100% of your prescription drug costs until the deductible is hit.  Plans can have a deductible of NO MORE THAN $590 in 2025.  Some plans will have a smaller deductible or no deductible at all.

2.  Initial Coverage Stage - you pay up to a 25% coinsurance for medication on your plan's formulary or list of covered medications.  The most you will spend is $2,000 out of pocket.  Some plan will have very low or no copays on prescriptions in varying tiers within their formulary or list of covered medications.

3. Catastrophic Coverage Stage - once you hit the $2,000 out of pocket cap, you won't have any more out of pocket costs.  All medications on the formulary will be covered at 100%.

4. Annual Reset - regardless of when your coverage began, all Medicare Part D plans (including those that come with a Medicare Advantage Plan) return to the Deductible Stage on January 1st of each year.  

Please be aware that if you change your plan during the year, you do not start the stages over on the new plan. This information follows you through your Medicare journey.

Rodolfo Rojas · Answer

It means that in 2025 you no longer have any donut whole. The Donut hole was a coverage gap in the prescription drug plans. It was confusing. Today, you don't have to worry about it anymore. The Inflation Reduction Act introduced that you have an out of pocket cap of 2000. 00 If you get to this amount, you don't pay for your medication anymore. . The medication has to be in the plan that you are on.

Answered by Rodolfo Rojas on May 21, 2025

Broker Licensed in NV, AL, AR & 22 other states

Answered by Rodolfo Rojas Medicare Insurance Agent

Jerry Cohen · Answer

Eklimination of the donut whole means that a big portion of patient cost sharing on prescription medication expenses has been eliminated. In 2025 maximum out of pockets expense for a covered person becomes $ 2,000.

Answered by Jerry Cohen on April 21, 2025

Broker Licensed in NY

Answered by Jerry Cohen Medicare Insurance Agent

Robert Remin · Answer

Max cost for all covered drugs in your plan cannot exceed 2000 total for all of them. Bewteen premium and max amount your costs should be way less than having a donut hole situation

Jack Mayer · Answer

For 2025 you will have an annual deductible of $590.00 then your maximum out of pocket will be $2000 but in most cases its much less because you are credited at times beyond the cost of the prescription.

Answered by Jack Mayer on April 14, 2025

Agent Licensed in CA & NV

Answered by Jack Mayer Medicare Insurance Agent

Rachael Metcalf · Answer

That means you are going to only be put of pocket $2000 before your drugs are at no cost.
It is a great reduction in Rx.

Adriana De la Cruz · Answer

That's right! The "donut hole," or coverage gap, is going away in 2025. This means that after you and your plan have spent a certain amount on covered drugs, you'll only pay 25% of the cost for the rest of the year. This change will likely lower your out-of-pocket costs for medications.

Answered by Adriana De la Cruz on May 23, 2025

Broker Licensed in TX, AZ, CA & NM

Answered by Adriana De la Cruz Medicare Insurance Agent

Brian Loquist · Answer

You only have to pay a total of $2,000 in drug cost IF your drug is in formulary with your Prescription Drug Plan!

Tommy Lawson · Answer

It means there is no longer a coverage gap that you are 100% responsible for paying. As long as your medications are covered on a carriers formulary, no matter how expensive the copay or retail cost may be, you have a maximum out of pocket on prescriptions of $2000 for the year.

Answered by Tommy Lawson on April 8, 2025

Broker Licensed in KY, CT & IN

Answered by Tommy Lawson Medicare Insurance Agent

Sean Krause · Answer

That’s right. Medicare this year now has a maximum prescription out of pocket limit of 2000 dollars. This means when you reach 2000 dollars out of pocket for your medications you’ll have no further cost.

Answered by Sean Krause on April 22, 2025

Broker Licensed in TN

Answered by Sean Krause Medicare Insurance Agent

Lowell Ryals · Answer

It
Means that your prices won’t go up through the year 
You may have a deductible with your prescriptions
You can also apply for a leveling out program to keep your copays level through the year

Aaron Young · Answer

What this means is that you will likely spend less on your medications than you have in past years.  For 2025 and beyond, the prescription drug plans will have a max out of pocket of $2000.

Amy Twary · Answer

Starting in 2025, there is no longer a donut hole. The maximum amount you would pay for your covered medications is $2000. This is called the catastrophic level. An agent like myself, can verify your drug costs for the year based on your plan.

Answered by Amy Twary on April 15, 2025

Broker Licensed in NC, OH, SC & TN

Answered by Amy Twary Medicare Insurance Agent

Eva Peterson · Answer

That means that the max you will pay for prescriptions per year is now capped at $2000/year. It was $8000 so this will help consumers reduce their prescription costs. Contact me if you need more questions answered or any assistance.

Answered by Eva Peterson on April 21, 2025

Agent Licensed in CA, FL & NV

Answered by Eva Peterson Medicare Insurance Agent

Jennifer Ragborg · Answer

It's true! After many years of promises, the donut hole is gone in 2025.  The rules changed to begin catastrophic coverage when you spend $2000.  last year, it was at $8000 of expense for you and your insurance company.  

If you are on inexpensive generics, this really doesn't apply to you.

My pharmacist mentioned the Medicare "donut hole" is going away in 2025. What does that actually mean for me?

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My pharmacist mentioned the Medicare "donut hole" is going away in 2025. What does that actually mean for me?

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