With or without Medicare, prescription drugs can be expensive. However, there are programs available to help seniors afford the medications they need under Medicare Part D.
Extra Help program
The Extra Help program is intended to assist individuals with limited resources and income who need help paying for their prescription drugs under Medicare. Extra Help can provide cost coverage for monthly premiums, annual deductibles and copayments.
According to the Social Security Administration, Extra Help is estimated to be worth approximately $4,000 per year.
Qualifying for Extra Help
In order to qualify for the Extra Help program, you must:
- Live in one of the 50 states or the District of Columbia
- Have financial assets limited to $13,440 as an individual or $26,860 as a married couple.
- Earn an annual income of $17,505 or less as an individual or $23,595 as part of a married couple.
Keep in mind that married couples must live together. Meanwhile, as far as resources are concerned, Extra Help classifies these as things like bank accounts and investments. However, your home, car and life insurance policies are not counted. Finally, even if your annual income is over the threshold, you may still be eligible for some help, such as if you support other family members who live with you or live in Alaska or Hawaii.
Additionally, some individuals automatically qualify for Extra Help. These include people who have full Medicaid coverage, receive help from state Medicaid programs for paying Part B premiums in a Medicare Savings Program or receive Supplemental Security Income benefits. However, it’s important to remember that automatically qualifying one year doesn’t guarantee automatic qualification the next. Changes in income will impact eligibility.
Levels of Extra Help
How much assistance you receive under the Extra Help program depends on what level you qualify for. There are four levels of Extra Help:
Level 1: At Level 1, your prescription drug costs are completely covered. You qualify for this level if you receive full Medicaid benefits and live in a nursing home.
Level 2: If you qualify for Level 2, you pay no premium or deductible for Medicare drug coverage. However, depending on your income, your copays will vary from up to $2.65 for generic drugs at up to $6.60 for brand name drugs. You qualify for Level 2 by receiving Medicaid or Supplemental Security Income.
Level 3: At Level 3, you pay no premium or deductible, but your copays are set at $2.65 for generic drugs and $6.60 for brand name drugs. In order to qualify for Level 3, your current income must be no higher than $1,293 a month as a single person or $1,745 a month as part of a married couple living together. Additionally, your assets can be no larger than $8,580 if single or $13,620 if married.
Level 4: Qualifying for level four means you will pay a percentage of your plan’s premium depending on your income, in addition to a $66 annual deductible. However, you will pay no more than 15 percent of the cost of each prescription. You qualify for Level 4 if your current income is no more than $1,436 a month if single or $1,939 if a married couple. Your assets can be no larger than $13,300 as a single person or $26,580 as a married person.
Besides the Extra Help program, you can reduce your prescription drug costs by:
- Opting for generic drugs
- Using mail-order pharmacies
- Researching state programs
- Signing up for a different Medicare plan featuring lower drug costs