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As House Returns to Health Care Repeal Effort, Lautenberg Vows to Eliminate Medicare 'Donut Hole'
Lautenberg Releases Data Showing Repeal Would Cost New Jersey Seniors More than $863 MillionLautenberg Press Office, 202-224-3224
Tuesday, January 18, 2011NEWARK, N.J. – As the U.S. House of Representatives continues the effort to repeal the historic health reform law, U.S. Senator Frank R. Lautenberg (D-NJ) today vowed to eliminate the Medicare ‘donut hole’ for seniors. The health reform law gradually closes the donut hole, reducing out-of-pocket drug expenses for seniors, and ultimately eliminates it completely. Lautenberg released county-by-county data demonstrating that the health reform law saves New Jersey seniors more than $863 million as a direct result of the ‘donut hole’ fix, and a repeal of the health care reform law would put that costly burden back on seniors.
“A vote in favor of repealing the health reform law is a vote in favor of bringing back the donut hole that has emptied the pockets of our seniors,” Lautenberg said. “The health reform law ensures that New Jersey seniors have the full drug coverage they need to stay healthy and saves them hundreds of millions of dollars over the next decade. Republicans want to heap this burden back on our seniors, but I will fight to eliminate the ‘donut hole’ so that seniors can afford the drugs they need.”
The ‘donut hole’ is a gap in prescription drug coverage that affected approximately 95,860 New Jerseyans in 2010. The health reform law reduces and eventually eliminates the ‘donut hole’ by requiring a 50 percent discount on brand-name prescriptions filled in the Medicare Part D coverage gap, and providing federal subsidies for generic prescriptions filled in the gap. The changes went into effect on January 1, 2011, and the discounts will increase every year until the ‘donut hole’ is fully closed in 2020.
With the ‘donut hole’ fix provided in the health reform law, New Jersey seniors will save an estimated $863.4 million over the next 10 years. The following chart shows an estimation of how that breaks down across the state:
Methodology: The number of seniors in the donut hole is based on CMS-provided 2010 data on the county-by-county enrollment in Medicare, multiplied by the percentage of New Jersey seniors enrolled in Part D in 2010 (52% according to the Kaiser Family Foundation). That figure was then multiplied by 14%, which is the number of Part D seniors in the donut hole nationally, as of 2007. To determine the total savings over the next 10 years, the number of seniors in the donut hole was multiplied by the average savings under the Affordable Care Act ($9,007), as determined by the White House Office of Health Reform (See Table 3).