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March 6, 2024

What is Medicare Extra Help?

Medicare Extra Help, also known as the Low Income Subsidy (LIS), is a federal assistance program that helps pay for prescription drug costs for people with limited income and resources. The Extra Help program, administered by the Social Security Administration, provides financial assistance for Medicare beneficiaries who have Part D prescription drug coverage.

Extra Help pays for all or some of the monthly premiums, annual deductibles, and prescription co-payments related to a Part D plan. By reducing the costs of prescriptions, Extra Help makes it easier for low-income seniors to obtain the medications they need.

To qualify for Extra Help, applicants must meet certain income and resource limits that demonstrate financial need. Resources taken into account include money in bank accounts, stocks, and bonds. Not all resources are counted, such as a primary home, car, burial plot, up to $1500 per person in life insurance, and household goods. Income limits to qualify for Extra Help depend on whether the applicant is single or married and if they reside in the continental United States or Alaska/Hawaii.

Extra Help Eligibility Requirements

To qualify for Extra Help, you must meet certain income and resource limits set by Medicare. The income and resource limits can change each year.

Income Limits

Your annual income must be limited to $19,320 for an individual or $26,130 for a married couple living together. Even if your annual income is higher, you may still qualify for some Extra Help. Some examples that could help you qualify include:

  • If you or your spouse support other family members who live with you
  • If you have earnings from work
  • If you live in Alaska or Hawaii

Medicare counts your income as money you receive from:

  • Social Security
  • Railroad retirement
  • Pensions
  • Salaries
  • Wages
  • Dividends
  • Interest
  • Rental income 
  • Any other taxable or tax-exempt income

Income that Medicare does NOT count includes:

  • Supplemental Security Income (SSI) 
  • Medicaid
  • Food stamps
  • Shelter assistance
  • Interest from tax-free bonds
  • Money you receive for medical care or social services

Asset Limits 

The limit on your total resources (your assets) is $15,510 for an individual or $30,950 for a married couple living together. Assets that Medicare counts include: 

  • Real estate (excluding primary residence)
  • Bank accounts including checking, savings and certificates of deposit (CDs)
  • Stocks
  • Bonds, T-bills, mutual funds, savings bonds
  • Individual retirement accounts (IRAs)
  • Cash at home or anywhere else

Assets Medicare does NOT count include:

  • Primary residence 
  • Vehicles
  • Personal possessions
  • Burial plots
  • Up to $1,500 for burial expenses per person
  • Life insurance policies with a face value of $1,500 or less 

Must have Medicare Part A and/or Part B

You must be enrolled in Medicare Part A and/or Part B to qualify for the Extra Help program. If you don't have Part A or Part B, you can apply for Extra Help before applying for Medicare

Benefits of Extra Help

Extra Help offers several valuable benefits that can reduce your prescription drug costs. The main benefits include:

  • Lower prescription drug costs: With Extra Help, you will pay less for your monthly prescription drug premiums and drug copays. Extra Help pays all or part of your plan premium and lowers your prescription copays to $3.95 for generic and $9.85 for brand name drugs in 2023.
  • No coverage gap: Extra Help provides "catastrophic coverage", meaning once you reach your plan's coverage gap (also called the "donut hole"), Extra Help will pay most of the costs for your drugs during the gap. This can save you thousands of dollars per year.
  • Lower deductibles and copays: In addition to prescription drug costs, Extra Help also lowers the deductible and copays for your Medicare doctor and hospital benefits if you have Original Medicare. Your yearly deductible will be no more than $99 and doctor visit copays will be no more than $20 in 2023 with Extra Help.

Extra Help makes medications and healthcare more affordable for those who qualify. Taking advantage of these valuable benefits can reduce the financial burden of medical costs and prescription drugs for people with limited income and resources.

How to Apply for Extra Help

You can apply for Extra Help through Social Security in several ways:

Online

The fastest way to apply for Extra Help is online at www.socialsecurity.gov/extrahelp. You'll need to create an account on the Social Security website before applying. Make sure to have the necessary documents on hand before starting the online application.

By Phone

To apply for Extra Help over the phone, call Social Security at 1-800-772-1213 and explain you want to apply for Extra Help with your Medicare prescription drug costs. The representative can take your application over the phone as long as you have all required information available.

By Mail

You can print out and complete the Extra Help application (Form SSA-1020) and mail it to your local Social Security office along with photocopies of any required documents. Make sure to include your name and Social Security number on all mailed documents.

In Person

Visit your local Social Security office to apply for Extra Help in person. An interviewer will go through the application with you and help you get all the required paperwork together. Be sure to bring photo ID and your Social Security card when applying in person. Call ahead to see if an appointment is needed.

Medicaid Enrollment

If you're enrolled in your state's Medicaid program, you automatically qualify for Extra Help. You don't have to apply separately.

Let Medicare know if you have Medicaid coverage so you can automatically get Extra Help with your drug costs.

No matter how you apply, Social Security will process your Extra Help application and determine your eligibility usually within 4-6 weeks. You can check the status online or by calling. Reach out for help completing the application if needed.

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Information Needed to Apply

When applying for Extra Help, you'll need to have the following information handy:

Proof of Income

  • Your most recent tax return (if you file taxes)
  • Pay stubs from the last 6 months
  • Social Security, pension, or retirement benefit statements
  • Unemployment compensation statements
  • Documentation of any other income

You'll need to provide proof of all your taxable and non-taxable income sources when applying.

List of Assets

  • Current bank account statements
  • Documentation of stocks, bonds, savings bonds, mutual funds, individual retirement accounts
  • Statements related to any property you own besides your primary home
  • Vehicle registrations for cars, trucks, recreational vehicles, boats, etc. 

Provide a detailed list of all your current assets and their values when applying for Extra Help. Assets are counted toward the resource limits.

Prescription Drug Plan Info

Have information related to any prescription drug coverage you currently have:

  • Name of prescription drug plan
  • Plan membership number
  • Group number

This helps determine your eligibility and calculate how much assistance you may receive. ## After Applying for Extra Help Once you submit your Extra Help application, here's what to expect:

Review of Application

After you apply, the Social Security Administration will review your application and verify all the information you provided. They may contact you if they need any additional documentation or clarification

Notification of Status 

You will receive a letter notifying you whether you qualify for Extra Help within 30 days of applying. If approved, the letter will provide information on the amount of assistance you'll receive. If denied, the letter will explain why you did not qualify and provide instructions for appealing the decision if you believe it was made in error.

Ability to Appeal

If your Extra Help application is denied, you have the right to appeal within 60 days of receiving the denial notice. You can submit a written appeal request to Social Security explaining why you disagree with the decision. Include a copy of the denial letter and any supporting documentation that may support your case. Social Security will then review your appeal and make a determination. If your appeal is approved, you could be eligible for retroactive benefits to the date of your original application.

It's important to carefully review the denial notice and follow the instructions provided to ensure that your appeal is properly submitted within the designated time frame. You may also consider seeking assistance from a Medicare insurance agent or a licensed professional specializing in Medicare advocacy to help you through the appeal process and increase your chances of a successful outcome.

Remember, the Extra Help program is designed to provide financial assistance for prescription drug costs to those who qualify. If you believe that you meet the eligibility criteria and have a valid reason for the denial, don't hesitate to exercise your right to appeal and fight for the support you deserve.

If you are Approved for Medicare Extra Help

Once you are approved for Medicare Extra Help, several steps may follow. First, you will receive a letter informing you of your qualification for Extra Help and providing information about the amount of assistance you will receive1. This letter will typically arrive within 30 days of your application.

After receiving approval, it is essential to review the letter carefully to ensure that all the information provided is accurate and matches your expectations. If you believe there has been an error in the approval or the amount of assistance granted, you have the option to appeal the decision within 60 days of receiving the denial notice12. The denial notice will also provide instructions on how to initiate the appeals process.

If you find that the approved Extra Help does not adequately cover your prescription drug costs or there are issues with your coverage, it is advisable to contact your prescription drug plan directly. They can assist you in addressing any concerns, making corrections, or resolving payment-related issues3.

It is important to note that Extra Help eligibility may need to be reassessed annually. You will need to provide updated information regarding your financial situation and other pertinent details to ensure the continued eligibility for Extra Help benefits. This will ensure that you receive the appropriate level of assistance based on your ongoing circumstances.

By effectively navigating the steps after being approved for Medicare Extra Help, you can maximize your benefits and ensure that you receive the necessary support for your prescription drug costs.

Sources:

  1. Source: Social Security Administration - Understanding the Extra Help with Your Medicare Prescription Drug Plan 2
  2. Source: Social Security Administration - Apply for Medicare Part D Extra Help program
  3. Source: Medicare.gov - If You Get Extra Help
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The level of help you get depends on your income and assets. You'll have to provide information about your financial situation.

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