July 18, 2018 Sophie Ferronato

Medicare Part D: Closing the Coverage Gap

Signed into law on February 9, 2018, the Bipartisan Budget Act (BBA) of 2018 entails significant adjustments to consumer spending under the Medicare Part D prescription drug program1. Beginning in 2019, the period of out-of-pocket expenses in Medicare, known colloquially as the coverage gap or donut hole, will be fully covered for beneficiaries. By requiring higher payments from pharmaceutical manufacturers, the BBA of 2018 accelerates the original timeframe laid forth in the Affordable Care Act for closure in 20202.

While the long-term effects are open to speculation, industry stakeholders will want to familiarize themselves with the components of this act to better prepare for its potential implications.

This white paper, authored by Robert Blank, provides information on the background of the changes and highlights considerations for strategy and operations.