Donut hole insurance is a type of health insurance that covers the gap in prescription drug coverage that occurs when a person’s out-of-pocket costs reach a certain amount. The donut hole is the coverage gap that exists between the initial coverage phase and the catastrophic coverage phase of a prescription drug plan.
Donut hole insurance can be important for people who take expensive prescription drugs, as it can help to reduce their out-of-pocket costs. Donut hole insurance is typically offered by private insurers, and it can be purchased as a standalone policy or as a rider to an existing health insurance plan.