The Part D Donut Hole in 2010, Part 2, The $250 Rebate

The Part D Donut Hole in 2010, Part 2, The $250 Rebate

Information has just come out from Medicare confirming what I blogged about concerning the $250 rebate that beneficiaries who are enrolled in Part D and who hit the “donut hole” in 2010. The donut hole, of course, is the payment band in the Part D prescription drug benefit in which you usually have to pay 100% of the costs of your medicines. (I say “typically” because a number of drug plans do pay limited amounts for some drugs in this band; for example, there may be some coverage for generics.) And it begins to apply after your total drug spending exceeds $2,830, and you have paid $940 out-of-pocket. Again, these figures can vary some plan-by-plan.

This new information indicates that you will automatically be sent a check for $250 if you have already hit the donut hole. And if you have not yet done so, but do hit it later this year, the check will automatically be issued to you. Checks will begin going out on June 10.

Some important points:

The $250 is a set, invariable amount. No matter how deeply or shallowly you fall into the donut hole, your rebate will be the same. “One size fits all.”

The $250 will not count as income for tax purposes. It’s tax free!

If you qualify for any level of Extra Help, you will not get this rebate.

The $250, in the form of a check, will be sent to you automatically by Medicare, not by your Part D drug plan. (The envelope it comes in will say “Medicare Part D”.)

You should absolutely not give anyone any information under any circumstances to get your $250 check. Apparently the scam artists that prey on seniors and the disabled have figured out this is an excellent way to extract critical personal information from you. If anyone calls asking for information, slam the phone down and call 1-800-MEDICARE.

If you believe you qualify for this check but you don’t receive it, you should first call your Part D drug plan and ask them to make sure that they have sent the correct information to Medicare that you have hit the donut hole. If this has been done properly, you should then call 1-800-MEDICARE and ask them to issue you your check.


I would be interested in getting feedback about how well this process works.