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Pioneer Editorial: New health bill closes donut hole

Call it socialism if you like, but one benefit of the new health care reform bill which took effect this week has anyone who has ever handled Medicare Part D a lot happier.

That's a lot of Americans, either seniors on Part D or those of us who help our parents with the complicated process to select a Part D plan.

As part of the health care reform law, the Centers for Medicare and Medicaid Services sent out this week partial payments to 80,000 Medicare Part D prescription drug program enrollees who have already reached the so-called "donut hole" in their coverage -- a gap of several thousand dollars.

Under the goofiest provision in law, once Medicare Part D enrollees' total prescription drug spending reaches a certain amount, their coverage stops and they have to pay 100 percent of the cost until they reach the level of catastrophic care and coverage again kicks in. This year, enrollees enter the donut hole when their total drug spending reaches $2,830. The gap extends to $6,440 in total spending before coverage kicks in. There is some flexibility in coverage, but 80 percent of plans do not offer gap coverage.

As a result, the huge out-of-pocket costs during the donut hole period causes some beneficiaries to reduce, alter or altogether stop taking their prescriptions.

The rebates offered this week is a first step in the new health care reform law that will close the donut hole gap by 2020.

So call the health care reform bill what you like, but to many Part D beneficiaries, it's offering manna from heaven this week.