Medicare Savings Programs (MSP) can pay Medicare Part A and Medicare Part B premiums, deductibles, copays, and coinsurance for enrollees with limited income and limited assets.
Q: Is there help for me if I can’t afford Medicare’s premiums?
A: Yes. Medicare Savings Programs (MSP) can help with premiums and out-of-pocket costs.
What are Medicare Savings Programs?
Medicare Savings Programs (MSP) can pay Medicare Part A and Medicare Part B premiums, deductibles, copays, and coinsurance for enrollees with limited income and limited assets. There are four different types of MSPs, and they provide varying benefits. Two of the MSPs only help to pay Medicare Part B premiums (but not Part A premiums or Medicare cost sharing), and one MSP helps disabled working individuals pay their Part A premiums.
As of 2021, the federal asset limits for most MSPs in most states are $7,970 for an individual, and $11,960 for a couple. (As of early January 2022, CMS had not yet updated the income limits for 2022, but the amounts do get adjusted for inflation each year, so 2022 amounts will be a little different from the 2021 amounts. These amounts should change when the federal poverty level amounts are published for 2022, which typically happens in mid-late January.) Your home, one car, a burial plot, and household items are not counted as assets.
But the federal income limits are different for each type of MSP (these income limits are for the continental U.S.; income limits are higher in Alaska and Hawaii):
- Qualified Medicare Beneficiary Program (QMB). Helps to pay premiums for Part A and Part B, as well as copays, deductibles, and coinsurance. This is the most robust MSP, and has the lowest income limits for eligibility. A single person could qualify in 2021 with an income of up to $1,094 per month ($1,472/month for a couple).
- Specified Low Income Medicare Beneficiary Program (SLMB). Helps to pay premiums for Part B. A single person could qualify in 2021 with an income of up to $1,308 per month ($1,762/month for a couple).
- Qualified Individual Program (QI). Helps to pay premiums for Part B. A single person could qualify in 2021 with an income of up to $1,469 per month ($1,980/month for a couple).
- Qualified Disabled and Working Individuals Program (QDWI). Helps to pay Part A premiums. This MSP is for people who are disabled but have returned to work, and lost their premium-free Medicare Part A. The income limits are higher (up to $4,379/month for an individual, and $5,892 for a couple in 2021), but the asset limit is lower, at $4,000 for an individual and $6,000 for a couple.
Here’s more information about MSPs, including the federal income and asset limits that applied to each type of MSP in 2021. Note that assets include money in the bank, and investments in stocks and bonds. But your primary residence and one car are not counted as assets, nor are your household and personal items. Here is more information about MSP benefits in each state.
How do I apply for Medicare Savings Programs?
Eligibility for MSPs is determined by your state Medicaid office, as the funding for MSPs comes from the Medicaid program. Medicaid is jointly run by the federal and state governments. If you think you might be eligible, you can apply for an MSP at your Medicaid or social services office (contact information for each state is available here).
Medicare urges beneficiaries to apply for MSP benefits if there’s any chance they might be eligible, even if they initially think that their income or resources are too high to qualify. This is particularly important given that states can have more lenient eligibility rules than the federal guidelines. So depending on the state, a person might end up being eligible for an MSP even if they assumed they wouldn’t after looking at the federal eligibility rules.
This page explains what documentation is needed for the MSP application process, and what to expect when you’re applying for benefits.
It’s important to understand that you have to reapply and re-qualify for your MSP benefits each year. You may get a renewal notice in the mail from your state Medicaid office explaining what you need to do. If not, you’ll need to reach out to your state Medicaid office to see what needs to be done to qualify for ongoing MSP benefits in the coming year.
You can also contact your State Health Insurance Assistance Program (SHIP) with questions related to MSPs.
Do you have to apply for an MSP during Medicare's annual election period?
No. You can apply for MSP assistance anytime. As noted above, you’ll do this through your state’s Medicaid office, which accepts applications year-round.
But the marketing and outreach before and during Medicare’s annual election period can be a good reminder to seek help if you need it. You might decide to make a change to your coverage during the annual open enrollment period, and simultaneously check with your state’s Medicaid office to see if you might be eligible for an MSP or Extra Help with your drug coverage.
Medicare-Medicaid dual eligibility
People who are eligible for MSPs are covered by Medicare, but receive assistance with premiums (and in some cases, cost-sharing) from the Medicaid program. But some low-income Medicare enrollees are eligible for full Medicaid benefits, in addition to Medicare.
About 20% of Medicare beneficiaries are dually eligible for both Medicare and Medicaid. This is true of older seniors who need nursing home care and have exhausted their own funding to cover the cost. Medicare does not cover custodial long-term care, but Medicaid does, if the person has a low income and few assets. The majority of the people living in American nursing homes are covered by Medicaid (virtually all of them are also covered by Medicare).
Is there financial help for Medicare Part D coverage?
Medicare offers “Extra Help” for Medicare enrollees who can’t afford their Part D prescription drug coverage. If you’re a single person earning less than $1,630 per month ($2,198 for a couple), with financial resources that don’t exceed $14,790 ($29,520 for a couple), you may be eligible for “Extra Help” (note that these income limits will also change when the federal poverty level numbers for 2022 are published by HHS). The program will reduce or eliminate your Part D plan’s premium and deductible, and also lower the cost of prescription drugs to a very small amount.
Here’s more information about Extra Help, including details about the type of notice you might receive from Medicare or Social Security, that you can then send to your Part D plan.
Many states offer State Pharmacy Assistance Programs (SPAPs), which help low-income individuals pay for prescription drugs based on their financial situation. You can use this Medicare tool to search for your state’s SPAP.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.
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