Qualifying for Extra Help with Medicare Part D Costs
Last Updated : 05/02/20195 min read
If you’re one of many beneficiaries who takes prescription drugs, you know that even if you have Medicare Part D prescription drug coverage, there are usually still out-of-pocket costs you’re responsible for. Prescription costs like copayments, coinsurance, and deductibles can quickly skyrocket depending on the medications you take, how often, and whether they’re brand-name or generic drugs.
If you enter the Medicare Part D coverage gap (or “donut hole“), your costs could be even higher.
Medicare’s Extra Help program offers financial assistance with Medicare Part D costs for beneficiaries with limited income. Here’s an overview of how it works and how to apply.
What is the Medicare Part D Extra Help program?
The Medicare Extra Help (or Low-Income Subsidy) program is for people who need financial assistance with their Medicare Part D coverage. Prescription drug coverage is available through either a stand-alone Medicare Prescription Drug Plan (which works with Original Medicare) or a Medicare Advantage Prescription Drug plan (if you have Medicare Part C). Both types of plans are available through Medicare-approved private insurance companies.
If you’re eligible for the Medicare Extra Help program, the level of assistance you get depends on your income and financial resources. The program caps the costs you pay for covered generics and brand-name medications. In 2019, enrollees who receive Extra Help won’t pay more than $3.40 for each generic medication and $8.50 for each brand-name medication. In addition, depending on your income and assets, you may get help with Medicare Part D premiums and deductibles.
Who qualifies for Medicare Part D Extra Help?
Eligibility for Medicare Part D Extra Help is based on your income and assets, and the limits change yearly. In 2018, you may be eligible for Medicare Extra Help if:
- Individual: your annual income is less than $18,210, and the value of your assets is less than $14,100.
- Married couple: your combined income is less than $24,690, and the value of your assets is less than $28,150.
When counting your resources to determine eligibility for Extra Help, Medicare includes items such as:
- Bank accounts
- Stock and bonds
- Real estate other than your primary residence
Medicare doesn’t consider the following resources when it comes to eligibility:
- Your house
- One vehicle
- Burial plot and up to $1,500 for burial costs if you’ve set aside money for this purpose
- Personal or household items
You may automatically qualify for Extra Help if you have Medicare and also:
- Receive full Medicaid coverage (meaning you’re eligible for the full range of Medicaid benefits).
- Are enrolled in a Medicare Savings Program, which pays for your Part B premium.
- Receive Supplemental Security Income (SSI) benefits.
Even if you automatically qualify this year, you may not next year if your income or resources change, or the Extra Help program adjusts its eligibility limits. You’ll receive a notice in the mail on gray paper by the end of September if this is the case. Even if you get this, you may still qualify, but you’ll need to reapply.
If the amount of Extra Help you’re receiving changes, you’ll get a notice on orange paper with your new copayment amounts. If you don’t get any notices in the mail, you can expect to receive the same level of assistance with prescription drug costs that you got the previous year.
What if I don’t qualify for Medicare Extra Help?
If you don’t qualify to receive Extra Help, there are still ways to save money. Your State Medical Assistance (Medicaid) office or your State Health Insurance Assistance Program (SHIP) can provide you more information on payment assistance for prescription drug costs. You can look up your local Medicaid and SHIP offices here.
Here are other ways to reduce costs for Medicare Part D prescription medications:
- Switch to a generic form of the prescription drug if available (check with your doctor first).
- Ask your doctor about less expensive brand-name drugs.
- Use a mail-order pharmacy, which may provide savings if you’re ordering a larger quantity of medications.
- Compare Medicare Part D coverage options to find plans with lower costs.
- Find out if the pharmaceutical company that makes your medication offers help paying for it. Some manufacturers may offer discounts through pharmaceutical assistance programs.
How can I find a plan that helps me save on Medicare Part D costs?
Even if you don’t qualify for the Extra Help this year, one of the simplest ways you can reduce prescription drug costs is by taking the time to compare and research plan options. Remember, Medicare Part D costs often vary from plan to plan—even when the prescription drugs being covered are exactly the same. Each Medicare plan that covers prescription drugs typically places covered medications into different “cost tiers,” and your copayment and coinsurance costs will depend on which tier your prescriptions fall onto. Typically, medications on higher tiers have higher cost sharing amounts.
The Medicare Advantage and Prescription Drug Annual Election Period (AEP) runs from October 15 to December 7 each year and is your yearly opportunity to take stock of your prescription coverage and make changes if needed. During this time, you can enroll in Part D coverage, switch plans, or drop your prescription drug coverage entirely.
If you like, I’d be happy to help you find plan options that cover your medications and could save you money. If you’d like to discuss this by phone, use the link below to set up a phone appointment at a time that works for you. Or, I can email you personalized plan options (you’ll find that link below as well). Prefer to browse plan options now? You can get started by clicking the Compare Plans button on this page; simply enter your prescriptions to filter your search and only display plan options that cover your medications.