I've been dreading hitting the donut hole each year. How will its elimination in 2025 change what I pay throughout the year?

Question

Timothy Brown · Accepted Answer

The Inflation Reduction Act of 2025 has reduced the out-of-pocket maximum for prescription drug coverage to $2,000. There will be no additional cost beyond this point, meaning the copay for any and all medications for the remainder of the year will be $0 after the $2 000 limit has been reached. As it's been in the past, low cost generic prescriptions are typically not a concern but as it relates to brand name prescriptions, here's some is some useful information: 

1. Depending on the plan, you may now incur a coinsurance instead of a flat copay

2. Some Medicare Advantage plans may now have a Part Deductible for various tiers

Steve and Sue Brauer · Answer

Its a great thing.... you're out of pocket limit has been reduced greatly. Its a complicated formula, but generally, you will not have to pay more than $2000 for "covered" or formulary prescription drugs in a calendar year. The formula takes into account, what YOU'VE paid for your prescription and what the drug manufactures drug costs are. The trick is making sure that you have a Prescription Drug Plan that covers your prescriptions.... with all of the changes, many plan have revamped their formulary offerings or moved drugs into different "tiers" to save money.

Answered by Steve and Sue Brauer on April 8, 2025

Broker Licensed in AZ & CA

Answered by Steve and Sue Brauer Medicare Insurance Agent

Bill Wheeler · Answer

As of 2025 the donut hole is no longer in effect. Your prescription cost will continue till you reach $2000.00. After that you go to zero copay.

Edward Smith, ChFC, CRPS, AIF · Answer

Thankfully, the law changed and the Donut Hole is gone bye, bye! We now have just 3 phases, The deductible phase, initial phase and the catastrophic phase.

***2026***
Carriers are allowed to have up to a $615 deductible, but not all do, the second phase is where you, the manufacturer, the insurance carrier and Medicare share in the cost of drugs included on the carrier's formulary list. There are a few tiers and co-pays and coinsurances vary between carriers.

However, once you and all parties on your behalf have paid $2,000.00 in a year for your covered drugs, they will be covered at 100% for the remainder of that plan year.

Ronnie Robinson Jr · Answer

The donut hole was eliminated at the beginning of 2025, where the maximum out-of-pocket for prescriptions is now $2000. For 2026, that amount increased to $2100, which is still a lot lower than any donut hole has ever been.

Answered by Ronnie Robinson Jr on November 6, 2025

Broker Licensed in FL, AL, GA & 9 other states

Answered by Ronnie Robinson Jr Medicare Insurance Agent

Melonie Wood · Answer

With all the 2025 Medicare Plans & Prescription Drug Plans, once a person reaches $2000 in cost including 25% of the drugs cost towards the $2000, there is no more costs to the member, therefore, no more "donut hole"

Answered by Melonie Wood on April 4, 2025

Agent Licensed in FL & AL

Answered by Melonie Wood Medicare Insurance Agent

Richard Moreno · Answer

You will pay less since the maximum out of pocket changed from 8,000 down to $2000, saving you $6000 in prescription costs

Luke Rhoads · Answer

The closing of the doughnut hole this year will provide significant savings for expensive prescriptions. Covered prescriptions will now have a $2000 max out of pocket for the year typically with a 25% coinsurance for the initial coverage stage.

Answered by Luke Rhoads on September 11, 2025

Broker Licensed in OK

Answered by Luke Rhoads Medicare Insurance Agent

James Carlson · Answer

The annual out of pocket limit for all drug purchases is $2,000. The donut hole is not a factor.
The annual deductible applies toward the oop max.

Don Hudson · Answer

This year the the maximum you will pay is 2,100 dollars. This information can be found in your summary of benefits documentation.

Robert Pennington · Answer

The maximum a senior will pay out of pocket for Rx in 2025 will be $2000.  This can be
Setup on a 12 month payment plan and be deducted from your SS each month. When you order or pick up Rx through the year, you pay $0.

Patricia &#039;Tif&quot; Bush · Answer

Your cost will be capped a lot sooner with the change. The total cost of your Scripts once they equal $2000 means that you will pay nothing for your medication’s for co-pays For drug costs up to up until the 2000 you will be paying co-pays or coinsurance.

Answered by Patricia 'Tif" Bush on September 7, 2025

Broker Licensed in ct, FL, NC & SC

Answered by Patricia 'Tif" Bush Medicare Insurance Agent

Brian Cronin · Answer

The short answer is it smooths things out. With the donut hole going away in 2025, you won’t hit that sudden spike mid-year — instead, your costs are more consistent and capped annually under Medicare Part D.

In most cases, that means fewer surprises and better predictability, even if your monthly costs may feel a bit more spread out over the year.

Robert Simm · Answer

Fortunately, you will not encounter the coverage gap in 2025, as this phase of prescription drug coverage has been eliminated.

Amy Putrino · Answer

No more "donut hole". As of January 1st, 2025, we all live is a world of donuts without holes! (picture a Boston Cream donut). Your drug coverage goes from January 1st to December 31st with NO coverage gap!

Answered by Amy Putrino on June 9, 2025

Agent Licensed in RI, AZ, CT & 12 other states

Answered by Amy Putrino Medicare Insurance Agent

Mitch Anderson · Answer

The elimination of the donut hole for Part D happened with the addition of a maximum out of pocket risk cap. The cap for 2025 is $2000 and the cap for 2026 is $2100. This means that the consumer will pay no more than the cap amount for prescription copays in a calendar year. Only medications that are on the plan formulary will count toward the cap.

Answered by Mitch Anderson on March 31, 2026

Agent Licensed in MN, IA & WI

Answered by Mitch Anderson Medicare Insurance Agent

Lauryn Ivey · Answer

For 2025, if you reach a true out of pocket expense that totals $2,000 then you don’t pay anything else for the rest of the year. This $2,000 includes your copays and any deductible that may apply to your plan. Without knowing your plan and which medications you currently take that is as specific as I can be to your question, because plans vary and the deductible may or may not have to be paid by you depending on the tier drugs you take.

Answered by Lauryn Ivey on July 4, 2025

Broker Licensed in AL

Answered by Lauryn Ivey Medicare Insurance Agent

Renee Brown · Answer

The "Donut hole" ended as of January 1st 2025. For 2025 there is a maximum out of
pocket on prescriptions of $2000. Once you hit the $2000, then you are in the catastropic stage and everything else is covered for you. There is also a payment plan that you can set up with the insurance company to pay a monthly amount for the $2000 so that if you have expensive drugs, you can spread it out over 12 months.

Ali Crouch · Answer

In 2025, the donut hole disappeared. A cap of $2000 for prescriptions became regulated throughout all drug plans. However, formularies still matter; if the prescription is not in the company's formulary, the person would pay full price for the medication.

Answered by Ali Crouch on June 24, 2025

Broker Licensed in NE, AZ, CO & 11 other states

Answered by Ali Crouch Medicare Insurance Agent

Michelle de Guzman · Answer

The elimination of the donut hole means that you will pay a deductible from $0 to $615 in 2026 plus up to $2100 out of pocket and then your copay will be $0 as you will have entered the catastrophic coverage phase.

Answered by Michelle de Guzman on April 8, 2026

Broker Licensed in TX, AZ, CA & 10 other states

Answered by Michelle de Guzman Medicare Insurance Agent

Kent Pike · Answer

The doughnut whole was eliminated in 2025. Prescriptions for the consumers are limited to $2,100 in 2026. There are also programs that reduce the burdens of cost such as the Prescription Payment Program now in effect.

Answered by Kent Pike on September 22, 2025

Agent Licensed in NC, CA, FL & 6 other states

Answered by Kent Pike Medicare Insurance Agent

Steven Bleicher · Answer

You've been happy to learn that the donut hole has been abolished. This is a great savings for people who take a variety of different drugs. There is a $2000.00 maximum out-of-pocket through 2027 matter whether you take generic drugs or Brand Name drugs. Last year, folks paid a maximum of $8,050.00 in the donut hole and it has been replaced by the $2,000.00!! Medicare keeps track of your costs for you.

Don't forget that you have options with regard to paying for a copay for a drug. These are as follows: A) Making a copay for a prescription at your "Preferred" or in-network pharmacy when you have an Advantage plan, B) if you opted for a Medicare Supplement, along with a "Stand-Alone" Part D prescription drug plan, again going to a in-network preferred pharmacy can be your best choice, except for C) using an online discount pharmacy which can yield a better price than thru your Part D drug plan. That is an option, but you can only use one or the other for the same drug. Also, remember that if you've had success in the use of a Canadian online discount pharmacy, those out-of-pocket costs will no longer be applied toward that $2K deductible.

Andrew Zurbuch, MBA · Answer

With the $2,000 maximum  in place in 2025 it should drastically lower your out of pocket prescription costs for prescriptions covered under Medicare Part D. You can also use a Mail Order pharmacy to lower your prescription costs if your prescriptions are available on Mail Order.
Please see www.locatemedicareinsurance.com for other information.

Andrew J. Zurbuch, MBA

Licensed Broker

Plans are insured or covered by a Medicare Advantage (HMO, PPO and PFFS) organization with a Medicare contract and/or a Medicare-approved Part D sponsor. Enrollment in the plan depends on the plan’s contract renewal with Medicare. We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.

Frank Carta · Answer

The donut hole has been replace with a limit to prescription drug costs. For 2026
the limit is $2,100 in Rx expenses. After that you pay nothing for covered, in-network
Part D drugs for the remainder of the calendar year.

Hannah Skinner · Answer

The donut hole has been replaced with a maximum out of pocket. For 2025, this Maximum out of pocket is $2000 for the year. This means that as long as your medications are covered under a plan's formulary, you will never pay more than $2000 for those medications in one year. This change has resulted in some plans raising their premiums and changing their formularies.

Answered by Hannah Skinner on July 16, 2025

Agent Licensed in SC, AL, AR & 44 other states

Answered by Hannah Skinner Medicare Insurance Agent

Daintee Hurst Dietz · Answer

A thorough review is necessary. Not all plans cover all drugs. With the appropriate plan you’d have a max of $2000 for covered drugs. For those either expensive meds this is going to be a big financial help.

Answered by Daintee Hurst Dietz on June 21, 2025

Broker Licensed in TX, AZ & CA

Answered by Daintee Hurst Dietz Medicare Insurance Agent

Rob Campbell · Answer

Your maximum out of pocket for Part D drugs is capped at $2100 for 2026. In addition, you can set up a payment plan that will allow you to average your drug costs monthly.

Sandy Nelson-Tittsworth, CMIP · Answer

The donut hole no longer exists in 2025.

The maximum out-of-pocket for drug cost is $2000 in 2025. When you reach the maximum cost after paying your drug deductible and co-pays for your medications, you will pay zero dollars for  your medications.

Michael Crocker · Answer

There's no donut hole in 2025; instead, there is a $2000 limit on what you can spend on covered prescription drugs. The "covered" part is extremely important; if you purchase a prescription that isn't covered by your plan, the cost of the drug doesn't apply to the $2000 limit.

Answered by Michael Crocker on April 12, 2025

Broker Licensed in SC

Answered by Michael Crocker Medicare Insurance Agent

Jessica Breland · Answer

The donut hole no longer exists. Hallelujah!! Annual RX costs are capped at $2000 for 2025 & $2100 for 2026. Once the maximum is reached, all covered RXs remain $0 for the remainder of the year.

Victoria R. Trevino · Answer

There are now 3 stages of Part D coverage. 
Deductible stage, Initial stage and Catastrophic stage. The donut hole (coverage gap) no longer exists. When one hits the threshold of $2100 in Rx expenses, the Medicare client pays $0 for covered Rx the remainer of the year.

Elayne Cotton · Answer

The donut hole is no longer a problem - it's been eliminated!  And the maximum out of pocket for medications is capped at $2,000.

Additionally, for the first time, the beneficiary can spread out the payments for the year with a capped monthly cost, instead of paying the pharmacy the full price when the medicines are purchase.

Vachik Chakhbazian · Answer

The elimination of the donut hole and the $2,000 cap apply to all stand-alone Part D plans and prescription coverage included in Medicare Advantage plans. Some Part D plans may have deductibles (up to $590 in 2025) which must be met before coverage begins

Answered by Vachik Chakhbazian on August 16, 2025

Agent Licensed in CA, AL, AR & 22 other states

Answered by Vachik Chakhbazian Medicare Insurance Agent

Andrew Kramer · Answer

Well that's easy to answer, no more donut hole! The max you can pay for Rx's in 2025 is $2,000, not matter the retail cost of the Rx, or the Rx deductible of your plan. Both figures go towards the $2,000.

Answered by Andrew Kramer on July 22, 2025

Agent Licensed in FL

Answered by Andrew Kramer Medicare Insurance Agent

Carol Thompson · Answer

In 2025- once your cost shared amount has reached $2000- there is no cost to you. In 25’ there is also a payment plan that you can opt in with your insurance carrier to stretch out the cost of you medications throughout the year.

Answered by Carol Thompson on May 16, 2025

Broker Licensed in FL, LA, MI & NC, SC, VA & WI

Answered by Carol Thompson Medicare Insurance Agent

Mark Boone · Answer

In 2025, hitting the "donut hole" is eliminated, and your costs are capped at $2,000 in out-of-pocket spending for covered drugs. After you spend $2,000, you enter the catastrophic coverage phase and pay nothing for your medications for the rest of the year. Additionally, you can now enroll in a Medicare Prescription Payment Plan to spread your high-cost drug expenses over the year in smaller monthly installments.

Answered by Mark Boone on October 2, 2025

Agent Licensed in MN, FL, MI & NC, OH, SC & VA

Answered by Mark Boone Medicare Insurance Agent

Marcie Barnes · Answer

Good news!  There is no Donut hole anymore.  Once you reach $2000 in out of pocket drug costs, the plan pays 100% for the rest of the year.

Mel Stevens · Answer

The donut has been an issue in previous years costing people up to $8,000 a year when taking many medications or rather taking expensive medications.  The good news, in 2025 the max out of pocket has decreased from $8,000 to $2,000 max out of pocket.  Furthermore, Medicare recipients paying high medication costs can also set up a monthly payment plan to help stabilize the cost throughout the year.  
Some tricks of the trade. 
If you've been prescribed an expensive medication by your physician, it's also always a good idea to contact the manufacturer. Often times the manufacturer will offer a discount on the medication through a direct program. 
Also, double check your prescription drug plan because insurance companies have in and out of network pharmacies. For example, Medication X might be less expensive at CVS vs Walgreens of vice versa.

Linda Davies · Answer

The specific costs can vary depending on the plan.  Some plans may offer coverage that is more robust than the standard design, so there is some plan-to-plan variations.

Given the financial implications of the Medicare donut hole, understanding how your plan impacts your drug costs can help you make better decisions.  

Having the donut hole conversation is the best approach to maximizing your Medicare benefits and minimizing your costs.

Robert Remin · Answer

Your max cost for covered drugs in 2025 cannot be more than 2000.00. Depending where you live odds very high your max cost for drugs and premium in 2025 will be less than when you had donut hole issues in the past

Answered by Robert Remin on May 19, 2025

Agent Licensed in NY, CT, FL & NJ

Answered by Robert Remin Medicare Insurance Agent

Adam Morillo · Answer

Generally you will see less out of pocket for major medications now that they have implemented the $2,000 max out of pocket. Now you can have peace of mind with a more predictable annual maximum.

William Murray · Answer

In addition to eliminating the donut hole, the Inflation Reduction Act implemented a Maximum Out of Pocket limit for your share of costs of the drugs you purchase which are covered by the plan you have.
In 2025 the Maximum Out of Pocket for covered drugs was $2,000. This amount includes what you paid for your deductible, copays & coinsurance. After hitting the $2,000 limit, you would pay $0 for the rest of the year for the covered drugs you purchase.
In 2026, the Max Out of Pocket limit with be $2,100 for drugs covered by the drug plan you have.
This would not include the monthly premium you have, if you pay one.

Al Saponar · Answer

It depends on your part D plan, and what prescriptions you take.

There also is a new rule establishing a Medicare Prescription Payment Plan to help spread out the copays for prescriptions over the remaining months of the year. If needed, it can be a huge benefit for many Seniors.

Tonya White · Answer

The donut hole was eliminated in 2025.  There is a max out-of-pocket for prescription drugs for medications in the plan's formulary, in 2025 that number is $2,000 and in 2026 it is $2,100.

Robert Moore · Answer

Currently there will not be a donut hole going forward.  So what this means for you is after you meet the $2000 max out of pocket you will no longer be paying for your medications.

Martha Lopez-Elkind · Answer

The elimination of the donut hole is a positive change that reduces or simplifies costs by capping your annual out-of-pocket drug costs at $2,000, after which you will pay nothing for your covered medications for the rest of the year. You'll also have the option to pay your out-of-pocket costs in monthly installments, spreading the cost over the year instead of paying in full at the pharmacy. Also, there is an enhancement to the low-income subsidy (LIS) program, extending more benefits to more individuals.

Answered by Martha Lopez-Elkind on September 29, 2025

Agent Licensed in NV

Answered by Martha Lopez-Elkind Medicare Insurance Agent

Brian Loquist · Answer

The great news is your total out-of-pocket maximum will be $2,000 for 2025 and $2,100 in 2026. The most important aspect to this is making sure all your medications are on Formulary. Please reach out to an industry professional for help!

Answered by Brian Loquist on July 9, 2025

Agent Licensed in SC, GA, NC & SD

Answered by Brian Loquist Medicare Insurance Agent

Sherri Beach · Answer

The Medicare Part D “donut hole” (coverage gap) was eliminated. That means you no longer have a phase where you suddenly pay a much higher share of your medication costs.

Instead, your drug coverage now works more smoothly throughout the year, with a hard annual out-of-pocket maximum.

April Ryan · Answer

New Part D, Prescription Drug Plan laws were established for 2025 that state individuals will pay no more than $2,000 in drug costs for the entire year. You may also set up a payment plan with your drug plan carrier to help with copays and deductibles.

Answered by April Ryan on June 9, 2025

Broker Licensed in NC, SC & VA

Answered by April Ryan Medicare Insurance Agent

Mark Mabaquiao · Answer

The good news is that you won't be paying more than $2000 for all your covered medications for the year (not including the monthly premium). The bad news is that you might have to pay higher copays at the beginning of the year - almost like a reverse donut hole where you're hitting the donut hole immediately rather than towards the middle or latter end of the year. You do have the option to break up your out-of-pocket drug costs into monthly payments, so it lessens the amount you have to pay initially.

Answered by Mark Mabaquiao on June 3, 2025

Broker Licensed in NV, AZ, CA, FL, HI & IL

Answered by Mark Mabaquiao Medicare Insurance Agent

Brian Maiz · Answer

The donut hole is officially gone as of 2025, and it's one of the biggest wins for Medicare beneficiaries in a long time. Here's what changed. There's now a $2,000 annual cap on what you'll ever pay out-of-pocket for covered drugs. Once you hit it, your plan picks up the rest for the year. 

If you're on expensive brand-name medications, this is a huge deal and if you're still worried about getting hit with that bill all at once, there's even a new option to spread your costs into monthly payments. 

The one thing that hasn't changed though is that the right Part D plan still matters and 
that's where I come in to make sure we get all your prescriptions covered at the lowest amount possible.

Janet Elliott · Answer

Have no fear! The inflation reduction act is here. You can use a payment plan with your carrier without interest and feel secure the bill for all your drugs will not exceed $ 2100.00 this year. You can get your prescriptions priced out for you ahead of time by calling your licensed agent.

Answered by Janet Elliott on May 7, 2026

Agent Licensed in NY

Answered by Janet Elliott Medicare Insurance Agent

Michael Martin · Answer

The donut hole has been eliminated meaning each individual will pay no more than $2000 for the year for their prescriptions. If you know that you are going to be over $2000, you can contact your carrier directly and set up a payment plan, bypassing any copayments or deductibles in your plan.

Answered by Michael Martin on April 28, 2025

Broker Licensed in NJ & PA

Answered by Michael Martin Medicare Insurance Agent

Nancy Nowell · Answer

With the elimination of the donut hole in 2025, there are now 3 cost share "phases"  instead of 4. The 3 phases of cost share are: 
(1) DEDUCTIBLE (in 2025 max allowed RX deductible is $590 / in 2026, it will be $615)
IF it applies and HOW it applies will depend on your plan structure and medication tier assignment.  Refer to your Summary of Benefits and plan sponsor for specific costs for you.
(2) INITIAL PHASE 
See your plan Summary of Benefits for cost share by tier, medication tier assignment, and pharmacy (formulary, tiering, retail cost and cost share by tier vary from plan to plan)

* if you reach the Annual Max Out of Pocket which was new in 2025 when the donut hole was removed, then you go to Phase 3 (Catastrophic)

*MOOP for 2025 is $2,000 and in 2026 will be $2,100

(3) CATASTROPHIC  - members pay $0 
(costs are absorbed by carriers, pharmaceutical companies and the government)

So, what you pay depends on your medication and plan selection, but these are the phases of cost share and your plan Summary of Benefits would be your guide to determining cost specific to you and your medications.

'Hope this helps!

I've been dreading hitting the donut hole each year. How will its elimination in 2025 change what I pay throughout the year?

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I've been dreading hitting the donut hole each year. How will its elimination in 2025 change what I pay throughout the year?

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