The Medicare Donut Hole

Running Head : The Medicare Doughnut Hole

Medicare , the nation 's largest health insurance program , covers nearly 40 million Americans . Medicare part D , a federal program to subsidize the costs of prescription drugs for Medicare beneficiaries in the United States , was enacted as part of the Medicare Prescription Drug Improvement , and Modernization Act of 2003 and went into effect on January 1 , 2006

Medicare Part D benefits are administered by private insurance plans that are reimbursed by the Centers for Medicare and Medicaid Services Beneficiaries can obtain the Medicare Drug benefit through

two types of private plans : a . Prescription Drug Plan (PDP ) for drug coverage only or they can join a Medicare Advantage plan (MA ) that covers both medical services and prescription drugs

The standard benefit for Medicare part D is defined in terms of the benefit structure and not in terms of the drugs that must be covered This standard benefit requires payment of a 265 deductible and the beneficiary then pays 25 of the cost of a covered part D prescription drug up to an initial coverage limit of 2 ,400 . Once the initial coverage limit is reached , the beneficiary is subject to another deductible , known officially as the Coverage Gap but referred to more commonly as the Donut Hole , in which they must pay the full cost of medicine

Health economists rationalize this gap , the Donut Hole , as a political compromise in which the optimal policy for the non-poor is stop-loss in which benefit payments would only start after an insured suffers the stop-loss limit of 3 ,000- 5 ,000 , after which the insurance covers 100 of the cost . For the needy who cannot absorb the stop-loss limit , supporters argue that plan should have a much lower (even zero dollar ) limit . In those cases , the all needed drugs would be provided free as this approach forces a disproportionate burden upon senior citizens and patients with chronic illness (Lee , 2006

Medicare part D has had success , but has also faced daunting challenges . Researchers now have a chance to learn from experience to date and to strengthen the program , particularly as it affects the frailest , sickest , and most vulnerable beneficiaries , including nursing home residents

Senior citizens are the most overmedicated group of people in the world Their lives and drugs are so intertwined that it is difficult to evaluate the justification for the enactment of Medicare Part D . The course of life is changed by dependence on drugs and quality of life is lowered when unnecessary drugs are taken . Unfortunately , this situation often occurs and Part D will aggravate the problem

This hypothesizes that continuing research on the effects of Medicare Part D will help improve the program and aid it into serving the US citizens more effectively . The criteria for choice of articles to include in the scope of this were (a ) accessibility (b frequently quoted in other referenced sources , and (c ) applicability to problem statement and hypothesis . The purpose of this is to review and...