New Health Care Law & Part D “Donut Hole” Rebate Checks

Recently, The Centers for Medicare & Medicaid Services (CMS) sent a mailing to Medicare beneficiaries titled “Medicare and the New Health Care Law-What It means for You.”  The purpose of this mailing is to advise Medicare recipients as to the benefits they may see as a result of the new health care law, The Affordable Care Act.  A copy of this publication can be found at

One of the first benefits available as a result of the passage of the new health care law will impact millions of seniors who receive Medicare Part D benefits.  If a Medicare beneficiary enters the Part D “donut hole” this year, the timeframe in the Part D prescription drug benefit where the Medicare recipient must pay 100% of his prescription costs until he hits catastrophic coverage, he will be eligible for a one-time $250 rebate check.  Medicare beneficiaries who are receiving Medicare Extra Help are not eligible to receive this rebate.  The first rebate checks will be mailed out in mid-June and will continue throughout the year as Medicare recipients enter the “donut hole.”  Checks will be mailed out to the Medicare recipient approximately one month after he enters the “donut hole.”  The $250 rebate is for 2010 only.

Next year, if a Medicare recipient enters the “donut hole,” he will receive a 50% discount for covered brand name Part D medications.  Additional savings will continue over the next 10 years with the coverage gap or “donut hole” closed in 2020.

CMS warns that “new opportunities for Medicare beneficiaries also bring new opportunities for scam artists to try to defraud seniors.”  As a result, seniors should be on the lookout for scams that request personal information in relation to this benefit.