The Medicare D “donut hole” is a colloquial term used in reference to the coverage gap in most Medicare prescription drug plans, according to Medicare.gov. This coverage gap puts a temporary limit on coverage for drugs and begins after the Medicare recipient spends a certain amount on covered medications.
The 2015 coverage gap begins after a Medicare recipient and the recipient’s Medicare plan spends a combined $2,960 on covered prescriptions, notes Medicare.gov. This includes the combined amount spent plus the recipient’s deductible. After breaching the coverage gap, recipients pay 45 percent of the plan’s cost for covered brand-name prescription drugs. For 2016, the coverage gap begins at $3,310.