OBJECTIVES: To assess the impact of the Medicare Part D coverage gap and co-pay levels on medication utilization behaviors among beneficiaries taking disease modifying drugs (DMDs) for the treatment of multiple sclerosis (MS). METHODS: A retrospective cohort study was conducted using a 5% national sample of Medicare beneficiaries for 2007.  Ambulatory patients diagnosed with MS and taking at least one DMD were included.  Adherence was measured using proportion of days covered (PDC).  Patients were classified as discontinuing therapy if last day of possession was more than 60 days before the end of the year.  Low income subsidy (LIS) status was used as a measure of out-of-pocket burden.  RESULTS: 1,439 beneficiaries with MS and DMD use were identified.  89% reached the coverage gap and 81% reached catastrophic coverage.  Average time in gap was 2 to 4 months for the different copay groups.   Overall PDC measures were 85.7% pre-gap, 81.7% during gap, and 87.3% in catastrophic coverage.  PDC for full year was higher (p<0.001) for no-copay LIS (90.2%) than for reduced-copay LIS (83.7%) and full-copay (79.8%) beneficiaries.  Full-copay beneficiaries were slightly more likely to stop therapy after hitting the gap than were reduced-copay or no-copay beneficiaries (17.7%, 15.0%, 10.6%).  Full-copay beneficiaries were more likely (p<0.001) than reduced-copay or no-copay beneficiaries to have a drop in PDC during the coverage gap (46.3%, 28.2%, 18.1%).    CONCLUSIONS: Most beneficiaries with MS reach the coverage gap early in the year and fairly quickly move to catastrophic coverage.  Average time in the coverage gap is limited, but significantly reduces adherence.  Higher out-of-pocket burden is also  associated with a reduction in adherence.