Lesson 5: Part D "Donut Hole"

Prior to 2025, most Medicare Part D plans came with a coverage gap, aka "donut hole". Once the plan deductible was satisfied, there was a limit on what you and your plan could spend on drugs. Once that amount was exceeded, your plan would enter into the "donut hole" where you would be required to pay a variable percentage of all drug costs for the remainder of the year.

Part D recipients will benefit from an annual maximum out-of-pocket cost for prescription drugs. All 2025 Part D plans now have a maximum out-of-pocket cost of $2,000. Once that $2,000 is reached, your plan will pay 100% for covered drugs for the rest of the plan year.