What does a "coverage gap" refer to in Medicare?

In the context of Medicare, a "coverage gap" specifically refers to a phase in the Medicare Part D prescription drug plan where beneficiaries experience increased out-of-pocket costs for their medications after reaching a predetermined spending limit. Once this limit is reached, enrollees enter the coverage gap, often referred to as the "donut hole." During this phase, the beneficiary is responsible for a larger portion of their drug costs until they reach catastrophic coverage, where costs significantly reduce again.

This aspect of Medicare is crucial for understanding how out-of-pocket expenses can fluctuate depending on the individual's medication needs and total drug spending within a given year. The concept of a coverage gap specifically relates to medication costs and does not apply to other aspects of health insurance coverage directly.

In contrast, other choices address different issues regarding health coverage or Medicare benefits that do not accurately depict what a coverage gap encompasses. For instance, having no health insurance does not define the coverage gap, and a temporary loss of Medicare benefits due to non-payment addresses a separate issue of eligibility rather than cost-sharing requirements. Meanwhile, only covering preventive services falls outside the definition of a coverage gap and relates more to specific provisions of Medicare regarding wellness and prevention.