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Medicare Extra Help Program Income Limits


Are you a Medicare beneficiary struggling with the cost of prescription drugs? A program called Extra Help offsets the cost of prescriptions for Medicare beneficiaries with Part D. If you have limited resources, you might qualify. We’re here to help you understand how Extra Help works with Part D, who’s eligible, how to apply, and more.

Extra Help with Your Medicare Prescription Drug Plan Costs

The Extra Help program assists people with limited resources and lower incomes in paying for Part D prescription drug coverage.

Getting Extra Help with your Part D can:

  • Reduce your out-of-pocket costs for prescription drugs
  • Eliminate your monthly Part D premiums
  • Reduce or eliminate your annual Part D deductibles
  • Eliminate the coverage gap, also known as the donut hole. This means your prescriptions won’t cost more just because you went over a spending limit in a particular year

On average, Extra Help is estimated to save beneficiaries $5,000 in these costs per year.

If you’re eligible for Medicaid or any of the following Medicare Savings Programs, you automatically qualify for Extra Help.

For those enrolled in Extra Help, generic prescription costs are no more than $3.60 each, and brand-name prescription costs are no more than $8.95 each.

If you didn’t enroll in Part D when you first became eligible, you won’t have to pay the late enrollment penalty if you have Extra Help.

What Are the Income and Resource Limits for Extra Help in 2021?

In 2021, the annual income limit for Extra Help for an individual is $19,140. For a married couple who is living together, the limit is $25,860. When your income is calculated, governmental assistance such as food stamps, housing assistance, and home energy assistance aren’t counted.

Even if your income is higher than the limits, you should still apply for Extra Help if you think you qualify. Some scenarios where you’d still be eligible for Extra Help even though your income is over the limit include if you and/or your spouse:

  • Provide financial support for other family members currently living with you
  • Earn money by working
  • Reside in Alaska or Hawaii

Resource limits also apply when determining your eligibility for Extra Help. Your resources must be equal to or below $14,610 as an individual or $29,160 as a married couple who are living together.

The following examples count as resources:

  • Real estate (primary residence excluded)
  • Money in bank accounts (checking, saving, CODs)
  • Stocks
  • Bonds
  • Mutual funds
  • Individual Retirement Accounts (IRAs)
  • Any cash

The following do not count as resources:

  • Your primary residence
  • Vehicle(s)
  • Your personal belongings
  • Burial expenses
  • Interest on money slated for use as burial expenses

Contact Social Security for a comprehensive list of excluded resources.

Levels of Extra Help

If your income and resources are greater than the limits listed above, you can still qualify for partial Extra Help. There are levels of Extra Help that depend on your income and resources.

You can mail your color-coded document to your Part D plan to help verify the level of Extra Help for which you qualify. Those who are dual-eligible to receive Medicare and Medicaid qualify for full Extra Help.

How to Apply for Extra Help with Medicare

To apply for Extra Help, you can fill out Form SSA-1020 on the Social Security website. You can also call Social Security to apply over the phone or visit your local Social Security office to apply in person.

Social Security will mail a letter to you, informing you of whether you qualify for Extra Help. You can choose a Part D prescription drug plan after you qualify for Extra Help. If you haven’t qualified, you can still look for a Part D plan that fits your budget and includes your prescriptions in the formulary.

FAQs

What does Social Security Extra Help Pay For?
Extra help can cover some of the Part D costs such as premiums, deductibles, and copayments.
Do you have to reapply for Extra Help every year?
Your eligibility will be reviewed automatically every year and you’ll receive a notice that states if you still qualify or not.
Is low-income subsidy the same as Extra Help?
Yes, Medicare extra help is also known as the Part D low-income subsidy.

How to Find a Medicare Part D Prescription Drug Plan

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Lindsay Malzone

Lindsay Malzone is the Medicare expert for MedicareFAQ. She has been working in the Medicare industry since 2017. She is featured in many publications as well as writes regularly for other expert columns regarding Medicare. You can also find her over on our Medicare Channel on YouTube as well as contributing to our Medicare Community on Facebook.

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