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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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Jagger Esch

Jagger Esch is the Medicare expert for MedicareFAQ and the founder, president, and CEO of Elite Insurance Partners and MedicareFAQ.com. Since the inception of his first company in 2012, he has been dedicated to helping those eligible for Medicare by providing them with resources to educate themselves on all their Medicare options. He is featured in many publications as well as writes regularly for other expert columns regarding Medicare.

2 thoughts on “Medicare Extra Help Program Income Limits

  1. Good afternoon,
    I turned 64 years on 27 September 1957. I am a retired Veteran with a 70 % disability awarded in 2020. I use Tricare Prime and reside in Corpus Christi, Tx.
    1. When should I enroll in Medicare?
    2. What plans would I need to have? A or B, D?
    Please advise

    1. Hi Kay – firstly, thank you for your service.

      1) We recommend you enroll in Medicare Parts A and B during your Initial Enrollment Period, around your 65th birthday. Medicare does not consider TRICARE to be creditable coverage for Parts A and B, so you would face late penalties when you eventually enroll in Medicare. When you enroll in Medicare Parts A and B, you’ll automatically enroll in TRICARE For Life (TFL). TFL acts as a wraparound for Medicare and covers certain costs.

      2) Per the above, we recommend you enroll in Parts A and B. If you’ve paid Medicare taxes for at least 40 quarters (10 years), you’ll get Part A premium-free. With TFL, you won’t need to buy extra prescription drug coverage for as long as you have TFL, as it is creditable for Part D.

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