What make and model is this headset and is it threaded or threadless? Also, are the bearings you see loose balls in retainers or cartridges?

I've never seen any headset that had a plastic top race or bearing cover so I assume you are describing a plastic or rubber ring seal between the top and bottom halves of the upper race. If so you could just cover the gap with a sleeve made from a short section of defunct inner tube or find a suitable size O-ring at the local hardware store.

Pictures would certainly help.