Medicare Donut Hole Rebate Checks

Jun 8, 2010
Press Release

Washington, D.C. – Congressman G. K. Butterfield reminds seniors who fall into the Medicare Part D “donut hole” that the one-time, tax-free $250 rebate checks start going out to this week.
“This is an important first step toward closing the Medicare donut hole,” Butterfield said.
Under the Affordable Care Act passed by Congress and signed by President Obama, Medicare will automatically send a $250 check to seniors who reach the coverage gap in 2010. Checks will be mailed monthly staring June 10th throughout the year as beneficiaries enter the coverage gap.
Butterfield said that once a Medicare beneficiary reaches the donut hole, they should expect to automatically receive a check within 45 days. Individuals receiving Medicare Extra Help will not receive a rebate check.
Butterfield warned seniors to be aware of scams seeking personal information.
“Medicare sends check automatically and there are no forms to fill out,” Butterfield said. “Don’t give any personal information – Medicare, Social Security or bank account numbers – to anyone who calls about the rebate check.”
Anyone who does receive calls seeking personal information is encouraged to call 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048.
Butterfield explained that most Medicare prescription drug plans have a coverage gap, which means that once beneficiaries have spent a certain amount, all drug costs must be paid for out of pocket up to a limit. Medicare drug coverage resumes once the limit is exceeded.
Butterfield said that under the health insurance reforms, the donut hole will eventually be closed completely. Beginning in 2011, beneficiaries in the donut hole will receive a 50 percent discount on brand-name drugs. Additional discounts for brand-name and generic drugs will be phased in to close the donut hole completely by 2020.
A typical senior who hits the donut hole is expected to save over $700 in 2011, and over $3,000 annually by 2020.
Butterfield said that the health insurance reform provided a number of additional improvements to make health care more affordable for seniors. In addition to closing the donut hole, out-of-pocket expenses for preventive services in Medicare have been eliminated, and cost sharing for many individuals dually eligible for Medicare and Medicaid will also be eliminated.