Benepath, Inc

Helping a Customer Understand the Donut Hole


Newtown Sq, PA -- (SBWIRE) -- 12/13/2016 -- One of the more difficult aspects of Medicare coverage relates to the donut hole, also referred to as the gap. Educating potential clients and existing clients on how it works is a key part of good customer service.

The Medicare donut hole has been one of those perplexing concepts since it earned its nickname. It is rather confusing to understanding when the donut hole starts and what amounts are covered in relation to prescription drugs.

"The actual name of the donut hole in Medicare Part D plans is a coverage gap," explained Clelland Green, RHU, CEO Benepath Inc. "And it is one of those concepts that everyone enrolling in Medicare needs to understand. As an agent, this is one of the areas you need to spend time on when educating your clients."

The donut hole begins when a customer and their Medicare drug plan (Part D prescription drugs) have spent a certain amount of money on drugs. That amount for 2016 is $3,319. Once that "hole" or "gap" has been reached, the insured pays 45 percent of the plan's cost for name-brand prescription drugs that are covered.

"Here is where things get a bit confusing," indicated Green, "even though a customer only pays 45 percent of a brand-name drug, what the customer pays plus the 50 percent discount from the drug maker also counts. Those two figures help beneficiaries get out of the gap."

The bottom line is that Medicare Part D, prescription drug plan recipients only remain in the gap until actual out-of-pocket expenses are higher than the plan's stated limit. Agents refer to this as the beneficiary's TrOOP, true out-of-pocket expenses.

"Selling Medicare coverage and Medicare supplement plans is a good niche to build your insurance agency into a force to be reckoned with," Green added. "Know your product. Work with integrity, demonstrate your product knowledge and provide good service. Those qualities are the stepping stones to success."