Medicare Extra Help
Low Income Subsidy
What is Medicare Extra Help?
Extra Help is a federal program that provides assistance with out-of-pocket costs related to Medicare prescription drug coverage (Part D), including premiums, deductibles, and copayments. Extra Help is also known as the Medicare Part D Low Income Subsidy (LIS). The Social Security Administration and the Centers for Medicare & Medicaid Services (CMS) work together to provide this benefit.
With Extra Help, you may not have to pay your Part D premiums or deductibles and a max cost is set for your coinsurance and copay for each prescription. The Social Security Administration estimates that Extra Help is worth about $5,300 in savings per year.
Who is Eligible for Extra Help?
Eligibility for Extra Help is determined based on income and assets – it is fundamentally a Low Income Subsidy (LIS). A combined income limit and resource limit are defined for individuals and couples; if you are within the income limit and resource limit, you should be eligible for Extra Help.
To find out if you qualify for Medicare Extra Help, you can fill out a free application. There’s no risk in filling out the application to find out if you could receive this assistance. You can apply again every year, even if you weren’t eligible before.
The Extra Help application will require some information to determine whether you are eligible; we’ve listed these items later in this article.
Some individuals are automatically eligible for Extra Help and may even be enrolled automatically.
- People who have a Medicare Savings Program (partial dual eligibility)
- People who receive Supplemental Security Income (SSI) benefits but do not receive Medicaid
- People who are eligible to receive Medicaid and Medicare (full dual eligibility)
What Paperwork Do You Need for the Medicare Extra Help Application?
- Social Security Card
- Investment statements
- Tax returns and Life insurance policies
- Payroll slips and Pension letters
- Recent balance statements from banks, credit unions etc.
Collecting these documents before you begin to apply will help you have a smoother application process.
What’s Included in the Resource Limit?
The exact numbers for the income limit that makes you eligible for Extra Help can change each year and it’s also important to know what is considered in that eligibility decision and what does not count.
Counts Toward Resource Limit
- Real estate (not where you live)
- Your checking and savings accounts
- Stocks
- Bonds
- Mutual funds
- Cash
- IRAs
Does NOT Count Toward Limit
- Your home
- Your possessions
- Your vehicle(s)
- Jewelry, furniture, etc.
- Non-business property for self-support (rentals or gardening land)
- Life insurance policies
Some other resources are not counted for nine months after you receive them, like housing assistance, some tax refunds, and more.
The complex details of how to calculate your resources for Extra Help are another reason that we recommend applying if you have any idea that you might be eligible. The Social Security Administration can assist you in determining the exact details of your application so that you don’t miss out on potentially $5,300 in savings each year.
How Do You Apply for Medicare Extra Help?
You can visit your local Social Security office, or you can call Social Security 1-800-772-1213. You may also apply online by visiting ssa.gov. The Extra Help Application is open at any point during the year. If you have Extra Help and become ineligible for it, that will be communicated to you in September so you have plenty of time to make decisions about your prescription coverage during the Annual Enrollment Period.
How Does Extra Help Work With Medicare Plans?
Once you have Extra Help, it will work directly with your prescription drug coverage, whether standalone Prescription Drug Plan or Medicare Advantage Prescription Drug Plan. Applying for prescription drug coverage is separate from applying for Extra Help; learn more about Medicare Part D Prescription Drug coverage.
Enrollment Eligibility
Annual Enrollment Period (AEP)
Medicare Annual Enrollment Period runs each year from October 15 to December 7. What is the Annual Enrollment Period vs. Open Enrollment Period?
Initial Enrollment Period (IEP)
Your Initial Enrollment Period generally surrounds your 65th birthday but may occur if you otherwise become eligible for Medicare for the first time.
Special Enrollment Period (SEP)
You may be eligible if you experience a qualifying life event such as moving to a new zip code, losing employer coverage, or change in Medicaid status.
Further Reading:
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Last Updated: September 30, 2024
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