Reform shrinking 'doughnut hole': HHS

About 3.6 million Americans with Medicare who reached the “doughnut hole” saved about $604 on their prescription drugs in 2011, according to data from HHS.

The doughnut hole refers to a coverage gap that requires enrollees who do not qualify for a low-income subsidy to pay the full cost of their drugs. HHS reported Thursday that the Patient Protection and Affordable Care Act—which provides a 50% discount on brand-name prescription drugs, and, in 2012, a 14% discount on generics—saved those 3.6 million beneficiaries about $2.1 billion on their prescription-drug costs last year.

“The Affordable Care Act is already saving money for millions of Americans with Medicare,” HHS Secretary Kathleen Sebelius said in a news release. “As we move forward, we will close the donut hole completely and save even more money for everyone with Medicare.”

HHS' “issue brief” reported estimated savings in Medicare Parts A, B and D to seniors from the Affordable Care Act and noted that the law will help lower beneficiary expenditures by decreasing Part B premiums growth; lowering beneficiary copayments and coinsurance growth under Parts A and B; closing the Medicare prescription drug-coverage gap; and providing preventive services at no additional cost. The average Medicare beneficiary savings in traditional Medicare, the report noted, will be about $4,200 from 2011 to 2021.

House Republicans on the Ways and Means Committee were quick to criticize HHS for its report, noting that the non-partisan Congressional Budget Office had predicted changes to Medicare part D are expected to increase seniors' monthly premiums by 9% in 2019.