Health reform moves to close U.S. Medicare drug gap

Democratic leaders moved on Friday to build support among the elderly for a massive overhaul of the U.S. healthcare system, saying the measure would immediately start closing a gap in Medicare prescription drug coverage.

The coverage gap, the so-called doughnut hole, occurs after a certain amount of money is spent. This year that level is $2,700 of which $896 is out of pocket expenses by the beneficiary. Coverage begins again once drug costs reach $6,154.

Speaker Nancy Pelosi said the healthcare reform bill being considered by the House of Representatives would reduce the that doughnut hole and lower the cost of medicine for as many as 4 million elderly next year.

“As of January 1, 2010, our legislation will give a 50 percent discount for brand-name drugs to recipients in the doughnut hole, and it will reduce the size of the doughnut hole by $500,” Pelosi said.

An earlier version of the bill would have started closing the doughnut hole beginning in January 2011.

House Democratic leaders are working to merge three healthcare reform bills approved by committees into a single bill that can pass the House and give President Barack Obama a major victory on a top domestic priority.

The emerging bill would also gradually eliminate the gap in prescription drug coverage in 10 years. The earlier version of the bill would have eliminated the gap in 15 years.

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