Maloney praises prescription drug “Donut Hole” check distribution

New York, NY – Rep. Carolyn Maloney (D-NY) today highlighted new data that show that a total of 8,100 seniors in her 14th Congressional District will receive $250 ‘donut hole’ checks in 2010 as part of the new Health Care Reform law signed by President Obama. The checks are meant to begin the process of closing the Medicare prescription drug coverage gap that occurs when annual drug expenditures exceed $2,830 for any recipient of Medicare Part “D” coverage.

“Prescription drugs cost many seniors thousands of dollars a year, so these checks are good news for anyone hitting the ‘donut hole’ this year,” Rep. Maloney said. “What’s more, donut hole benefits will increase beginning in January 2011, when all seniors who hit the donut hole will get a 50% discount on brand-name drugs. These discounts will save seniors in the 14th district $4.3 million next year, with the benefits continuing to grow until the donut hole is completely eliminated for both brand-name and generic drugs in 2019.”

4,830 seniors in the 14th district have already received $250 checks during the first three quarters of 2010, ending October 1, and 3,270 more seniors are expected to enter the donut hole and receive checks before the end of the year. The 8,100 total checks this year for residents of the 14th district will provide over $2 million in assistance to help pay high drug costs. Nationwide, over 1.8 million checks have already been distributed; by the end of the year, about 4 million seniors across the country will have received the check.

The prescription drug benefit as designed by the previous administration in 2003 created a problem for seniors who spend a lot on prescription drugs. Seniors must pay out of pocket for expenditures between $2,830 and $6,440 of annual prescription spending. That ‘donut hole’ of $ 3,610 in drug costs is significant for many households—and is what the health care reform law begins to eliminate this year with the $250 payments.

The analysis is based upon data release by the Centers for Medicare and Medicaid Services. See Centers for Medicare and Medicaid Services, State and Local Distribution of Coverage Gap Rebate Checks (Oct. 2010) (online at http://www.cms.gov/PrescriptionDrugCovGenIn/09_ProgramReports.asp#TopOfPage).