Summary: Medicare Extra Help is a low-income subsidy for individuals enrolled in Medicare Part D. This federal program helps reduce the out-of-pocket costs for prescription drugs. There are income and resource limits in order to qualify for Extra Help. Learn more about these limitations below. Estimated Read Time: 7 min
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Table of Contents:
- Medicare Extra Help Benefits
- How to Qualify for Medicare Extra Help
- Medicare Extra Help Drug Costs
- What are the Medicare Extra Help Income and Resource Limits for 2023?
- What are the Medicare Extra Help Income and Resource Limits for 2022?
- Levels of Extra Help
- Applying for Extra Help with Medicare
- How to Find a Medicare Part D Prescription Drug Plan
If you are a Medicare Part D beneficiary struggling with the cost of prescription drugs, Extra Help may be the assistance you need. Extra Help is a low-income subsidy that offsets the cost of prescription drugs on your Medicare Part D plan. You may qualify for assistance if your resources are below a certain threshold. Below, we help you understand how this program works with Medicare Part D, who is eligible, and how to apply.
Medicare Extra Help Benefits
The Extra Help program assists people with limited income and resources with paying for Medicare Part D prescription drug coverage. This low-income subsidy helps with monthly premiums, annual deductibles, and co-payments.
Depending on your income and assets, you may receive Full or Partial Extra Help benefits. Additionally, there are four levels of Partial Extra Help that will impact how much you save on your plan’s monthly premium. When you qualify for Extra Help, you will receive a letter detailing the level of help you’ll receive.
Receiving Extra Help with your Medicare Part D can:
- Eliminate the Medicare Part D late enrollment penalty
- Reduce your out-of-pocket costs for prescription drugs
- Reduce or eliminate your monthly Medicare Part D premium
- Reduce or eliminate your annual Medicare Part D deductible
- Eliminate the coverage gap, also known as the donut hole
There are varying levels of Extra Help that impact your Medicare Part D out-of-pocket costs. By qualifying for Full Extra Help, you will not have to pay your plan’s premium or deductible. If you qualify for Partial Extra Help, your plan premium will be reduced based on your income. Additionally, your plan’s annual deductible cannot exceed $104.
Extra Help also eliminates the Medicare Part D donut hole coverage phase. Normally, after your total drug costs reach $5,030, you leave the initial coverage phase and enter the donut hole. When in the donut hole, you are responsible for paying 25% of the cost of your prescription drugs. You stay within this coverage phase until your total costs reach $8,000.
As Extra Help removes the donut hole, your prescriptions will not cost more when you exceed the annual spending limit. The program saves beneficiaries nearly $5,000 in annual Medicare Part D costs.
How to Qualify for Medicare Extra Help
To qualify for Extra Help, you will need to meet the following requirements:
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Enroll in Medicare Part A and/or Part B
To apply for Extra help, you are required to be enrolled in at least one part of Original Medicare. You do not have to be enrolled in a Medicare Part D plan before applying for Extra Help. If you are not already enrolled in a Medicare drug plan, you will be automatically enrolled in one once your Extra Help application is approved.
Be a United States citizen
To be enrolled in Original Medicare, you must be a United States citizen. Thus, to enroll in extra help for Medicare Part D costs, you must also have been a U.S. citizen or legal resident for at least five consecutive years.
Meet the income and resource limits
There are certain income limits you must not exceed in order to enroll in Medicare Extra Help. The chart below helps outline these limits.
In certain cases, there are exceptions to the above requirements. You automatically qualify for Extra Help if you are eligible for full Medicaid coverage or any of the following Medicare Savings Programs:
- Qualified Medicare Beneficiary(QMB)
- Specified Low-Income Medicare Beneficiary (SLMB)
- Qualifying Individual (QI)
If you automatically qualify for Extra Help, you do not need to apply. You will automatically be enrolled in both the Extra Help program and a Medicare drug plan. You will receive a letter in the mail detailing your coverage.
Medicare Extra Help Drug Costs
With Extra Help, your out-of-pocket costs for prescription drugs will be reduced. If you have full Extra Help, you will only pay up to $4.15 for generic drugs and up to $10.35 for brand-name drugs. If your total drug costs reach $7,400 (this includes what you pay plus what your plan pays) you will pay $0 for all covered drugs.
If you have partial Extra Help, you will pay no more than 15% of the cost for each drug covered under your plan. Once you reach $7,400 in total drug costs, you’ll pay no more than $4.15 for each generic drug and $10.35 for each brand-name drug.
If you did not enroll in Medicare Part D when you first became eligible, you do not have to pay the late enrollment penalty if approved for the program. Approval waives this cost if you would otherwise owe the penalty.
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What are the Medicare Extra Help Income and Resource Limits for 2023?
An individual’s Medicare Part D Extra Help income limit in 2023 is $21,780. For a married couple, the 2023 income limit is $29,580. Income limits for Extra Help are based on your adjusted gross income as reported on your tax return.
When calculating your income, governmental assistance such as food stamps, housing, and home energy assistance do not negatively impact you.
You should apply if you think you qualify, but your income exceeds the limits. In some scenarios, you may still be eligible for Extra Help when your income is over the limit. These cases include when you 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. To be eligible for partial Extra Help, your resources (assets) must be equal to or below $16,660 as an individual or $33,240 as a married couple living together (with burial expenses). Without burial expenses, the resource limit for an individual is $15,160 and $30,240 for a married couple.
To receive full Extra Help benefits, the resource limit with burial expenses for an individual is $10,590 and $16,630 for a married couple. Without burial expenses, the resource limit for an individual to receive full Extra Help benefits is $9,090, and $13,630 for a couple.
The following examples count as resources:
- Real estate (primary residence excluded)
- Money in bank accounts (checking, saving)
- 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.
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Medicare Extra Help Limits 2023 Chart
The chart below displays the general limits for Extra Help with Medicare Part D in 2023. Still, individuals with higher incomes and resources may qualify for partial assistance in some circumstances.
Extra Help Level | Marital Rights | 2023 Extra Help Resource Limit | 2023 Extra Help Resource Limit with Burial Expenses | 2023 Extra Help Income Limit |
---|---|---|---|---|
Full | Single | $9,090 | $10,590 | $21,870 |
Full | Married | $13,630 | $16,360 | $29,580 |
Partial | Single | $15,160 | $16,660 | $21,870 |
Partial | Married | $30,240 | $33,240 | $29,580 |
What are the Medicare Extra Help Income and Resource Limits for 2022?
In 2022, the annual income limit for Extra Help for an individual is $20,625. For a married couple living together, the limit is $27,705.
The 2022 resource limits for partial Extra Help benefits are $15,510 for an individual with burial expenses or $14,010 for an individual without burial expenses. The asset limits for a married couple are $30,950 with burial expenses or $27,950 without burial expenses.
The 2022 resource limits for full Extra Help benefits are $9,900 for an individual with burial expenses or $8,400 for an individual without burial expenses. For a married couple, 2022 asset limits are $15,600 with burial expenses or $12,600 without burial expenses.
Medicare Extra Help Limits 2022 Chart
Extra Help Level | Marital Rights | 2022 Extra Help Resource Limit | 2022 Extra Help Resource Limit with Burial Expenses | 2022 Extra Help Income Limit |
---|---|---|---|---|
Full | Single | $8,400 | $9,900 | $20,625 |
Full | Married | $12,600 | $15,600 | $27,705 |
Partial | Single | $14,010 | $15,510 | $20,625 |
Partial | Married | $27,950 | $30,950 | $27,705 |
Levels of Extra Help
If your income and resources are more significant than the limits above, you can still qualify for partial Extra Help. With Extra Help, there are levels of assistance that depend on your income and resources.
You can mail your Extra Help qualification letter to your Medicare Part D plan to help verify the level of Extra Help for which you qualify. Those dual-eligible to receive Medicare and Medicaid qualify for full Extra Help.
Applying for Extra Help with Medicare
To apply for Extra Help, you can complete 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 whether you qualify. You can choose a Medicare Part D prescription drug plan after becoming eligible for Extra Help. If you do not yet qualify, you can still look for a Medicare Part D plan that fits your budget and includes your prescriptions on the formulary.
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How to Find a Medicare Part D Prescription Drug Plan
Finding the right Medicare Part D plan can be confusing. Our licensed agents are Medicare experts dedicated to putting your needs first. We specialize in finding the best Medicare Part D plans for our clients. Our agents compare how each Medicare Part D plan covers prescriptions and dosages.
We work with beneficiaries nationwide to find the best plan for their needs and budget. Call us today at the number above to compare plans from top-rated carriers. Or, complete our online rate form to compare policies today.
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Sources:
MedicareFAQ is dedicated to providing you with authentic and trustworthy Medicare information. We have strict sourcing guidelines and work diligently to serve our readers with accurate and up-to-date content.
- Extra Help, Medicare . Accessed July 2023.
https://www.medicare.gov/publications/11215-extra-help-not-automatically-qualify.pdf - Find Your Level of Extra Help, Medicare . Accessed July 2023.
https://www.medicare.gov/your-medicare-costs/get-help-paying-costs/find-your-level-of-extra-help-part-d - Prescription Help, SSA . Accessed July 2023.
https://www.ssa.gov/benefits/medicare/prescriptionhelp.html
I can not afford Medicare part B as my income is below poverty level. I’m 66 with Medicare part A only which is useless alone. Is there financial aid to pay the $170/month premium that is Not for Medicare Advantage, I do not want that!?
Hello Teresa,
If you’re looking for help paying for Medicare Part B premiums, be sure to learn more about these programs:
Best of luck!
I’m 73 and currently receiving “Extra Help”. I receive $1323 in Social Security every month. My question is how much money can I earn working (if I get a part time job) and still be able to qualify for “Extra Help”
Philip, the annual income limit for full Extra Help benefits is $20,385 or $27,465 for a married couple. If you excees this income limit, you will not receive full Extra Help benefits.
When does Extra Help end if I go over the asset limit?
Scott, Extra Help can end at any time. If you exceed the asset limit, once Social Security receives that information, your Extra Help benefits will end.
Are the income limits for extra help gross or net?
Shelly, these income limits are based on your adjusted gross income.
The adjusted gross income as determined on your tax return?
Yes, this would be based on what you report on you tax return.
What am I supposed to do about a Roth IRA not save?
Jane, a Roth IRA does count as a resource. If your IRA amount exceeds the limits, you would be ineligible for Extra Help.
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
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.