Compared to the premiums for private health plans, Medicare can seem like a bargain. But even Medicare’s out-of-pocket costs can add up, especially if you’re on a fixed income. Fortunately, there are Medicare Savings Programs, also known as Medicare buy-in programs, that help cover certain out-of-pocket costs associated with Medicare.
Depending on your income and other financial resources, you may be eligible for these programs, which can pay all or part of your Part A and Part B premiums, deductibles, copayments, and coinsurance amounts. You may also qualify for help with your Part D prescription drug costs.
Here’s a look at the different Medicare Savings Programs and how they can help pay for your health care.
What are the Different Medicare Savings Programs?
There are actually four options to qualify for a Medicare Savings Program:
- Qualified Medicare Beneficiary (QMB). QMB pays all of your Part A premiums (if you have them). It also pays for your Part B premiums, deductibles, copayments, and coinsurance amounts. You also automatically qualify for the Extra Help program to help with your Part D prescription drug costs.
- Specified Low-Income Medicare Beneficiary (SLMB). SLMB covers your monthly Part B premium. You also automatically qualify for Extra Help.
- Qualified Individual (QI). QI covers your monthly Part B premium, but has a slightly higher income limit to qualify. If you qualify, you also automatically get Extra Help with Part D.
- Qualified Disabled and Working Individual (QDWI). QDWI covers the Part A premium for people who don’t qualify for premium-free Part A. This sometimes occurs because they have either returned to work or are disabled and currently working.
Medicare Savings Programs Eligibility
Eligibility is based on both your monthly income and your financial assets, which include cash in checkings and savings accounts, stocks, bonds, and individual retirement accounts. Other financial assets, such as your home, furnishings, and personal items, your car, a burial plot, and up to $1,500 in burial expenses do not count against your allowable assets.
What are the Medicare Savings Programs income limits?
The table below shows the eligibility requirements in 2019, and may change from year to year.
Keep in mind that these programs are administered at the state level, so each state may have different guidelines for calculating your income and assets—even if your income and resources are slightly above the limits listed above, you should contact your state’s Medicaid office or State Health Insurance Assistance Program (SHIP) for details about how to qualify.
How to Apply for Medicare Savings Programs
To find out more about Medicare Savings Programs administered in your state, visit this page on Medicare’s website.
What is the Extra Help Program?
The Extra Help program, also called the Part D Low Income Subsidy, or LIS, is a federal assistance program that helps offset your prescription drug costs.
As with the Medicare Savings Programs, eligibility is means-tested. It is based on your monthly income and financial resources.
There are three levels of assistance. Depending on which level you qualify for, you could pay no monthly premium for your Part D coverage. Your deductible may also be waived. Your prescription costs in 2019 could also be as low as $3.40 for generic drugs and $8.50 for brand-name medications covered under your plan.
To qualify, your monthly income must be below $1,581 for an individual or $2,134 for a married couple. Your financial assets must total less than $14,390 for an individual or $28,720 for a married couple. To get the maximum benefits under the program in 2019 ($0 premiums, $0 deductible, and $0 for medications after you spend $5,100 out of pocket for the year), your monthly income can’t exceed $1,425 for an individual, or $1,922 for a married couple. Your assets must be less than $9,230 individual, $14,600 for a married couple.
You may be able to qualify for Extra Help even if you don’t qualify for one of the other Medicare Savings Programs.We find that people who qualify for Extra Help can often save several thousand dollars per year.
Get Help with Medicare Savings Programs
If you have qualified for Extra Help and need assistance with setting up a Medicare Advantage plan, reach out to us here. We can tell you about plans for people who have both Medicare and Medicaid.