How Medicare Extra Help may lower prescription drug costs
Medicare prescription drug costs can be difficult to manage, especially for people on fixed incomes. For those who qualify, the Medicare Part D Low-Income Subsidy program, also called Extra Help, may help lower certain costs, such as plan premiums, and prescription drug costs. Below we explain key details like, how Extra Help works, who may be eligible and how to apply.
What is Medicare Extra Help and how can it lower prescription drug costs?
Medicare offers a program that can help beneficiaries with limited income and resources save on prescription drug costs. It’s called the Medicare Part D Low-Income Subsidy program, also called Extra Help.
What is the Medicare Extra Help program?
Extra Help is a program managed by the Social Security Administration and is designed to help people on Medicare pay for prescription drug costs.
What cost savings does Extra Help provide?
- Low monthly premium for Medicare Part D coverage or Medicare Advantage plans with Prescription Drug Coverage.
- $0 annual Part D deductible.
- Lower prescription drug costs:
- $5.80 or less for generic drugs.
- $14.40 or less for brand-name drugs.
- No late-enrollment penalty if you didn’t enroll into a plan with Part D coverage when first eligible.
- Note: This does not eliminate the Part B late-enrollment penalty.
Who qualifies for Medicare Extra Help?
Most who are on Medicare and Medicaid or enrolled in a Medicare Advantage Dual Special Needs plan, automatically qualify for Extra Help. However, not everyone is eligible for the program. For those who don’t qualify automatically, there are some requirements that need to be met. Generally, you’ll need a Medicare Part D plan or a Medicare Advantage plan with drug coverage. You’ll also need to meet income and resource limits set by Social Security. Learn about income limits here .
How much will my drugs cost if I have Extra Help?
There are different Extra Help cost levels. Your level will depend on how you qualify for the program. Depending on your Extra Help level, what you pay for covered drugs may include:
- $0 for all covered drugs
- A low copay for covered generic drugs, such as $1.65 or $5.80
- A low copay for covered brand-name drugs, such as $5 or $14.40
Medicare sets these copay amounts each year, so they may change from year to year. Sometimes your plan’s copay may be less than the Extra Help copay. If that happens, you pay the lower amount. For example, if your plan has a $0 copay for certain covered drugs, you would pay $0 for those drugs.
What is the income limit for Extra Help?
Your reported annual income must be less than $23,940 for one person — or less than $32,460 for a married couple living together. If you live in Alaska or Hawaii, earn an income from work, or support family members who live with you, the limit may be higher.
The income limit does not include:
- Supplemental Nutrition Assistance Program (food stamps)
- Housing assistance
- Home energy assistance
- Medical treatment and drugs
- Disaster assistance
- Earned income tax credit payments
- Assistance from others to pay your household expenses
- Victim’s compensation payments
- Scholarships and education grants
Get additional information about Extra Help and learn more about Low Income Subsidy (LIS) levels and the most recent program updates.
Extra Help resource limits
To get Extra Help, your “resources” (the things you own) must be limited in value. The limit is $16,590 for an individual or $33,100 for a married couple living together. Examples of resources include:
- Real estate, except for your primary residence
- Bank accounts or retirement accounts
- Stocks, bonds, or mutual funds
- Cash at home or anywhere else
Some of the things you may own do not count toward the resource limit, including:
- Your home (primary residence)
- Your personal possessions, including furniture or jewelry
- Any vehicles you may own
- Life insurance policies
If you’re an American Indian or Alaska Native, some income and resources will not be counted.
Who automatically qualifies for Extra Help?
Some people automatically qualify for Extra Help, including:
- Those who get full coverage from Medicaid
- Those who get Supplemental Security Income (SSI) benefits
- Those who get help paying Medicare Part B premiums from Medicaid
- Those who are eligible for both Medicare and Medicaid (D-SNP plan members)
How do I apply for Extra Help?
To get Extra Help, you’ll need to apply with the Social Security Administration. In the application, you’ll be asked about resources and income. And if you live with a spouse, the application will also ask about their resources and income. It will save time to prepare this information in advance.
Apply online for Medicare Part D Extra Help. You can also apply at your state medical assistance office. Or call Social Security at
1-800-772-1213 / TTY 1-800-325-0778 from 7 a.m.–7 p.m., Monday through Friday.
If you do not currently qualify for Extra Help, you can apply again when your income and resources change.
More ways to save on Medicare and prescription drug costs
Beyond prescription drug plan savings, there are other ways to save on Medicare costs. Learn more about other assistance programs.
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