Medicare Savings Programs

Medicare is government-sponsored insurance for individuals 65 or over. Established by the federal government in 1965, it’s a way for older individuals to get health insurance they otherwise wouldn’t qualify for or couldn’t afford.

Initially, Medicare only covered hospitalization and medical services, Parts A and B. Over time, Medicare added Parts C and D, along with coverage for the disabled and those with chronic illnesses. Today all types of tailored plans help individuals with their healthcare expenses, including Medicare Savings Programs.

Medicare Costs

Medicare consists of 4 basic Parts. Coverage is paid by taxes and the federal government. While it’s affordable, it’s not entirely free. Costs for the different Parts include:

• Part A. Hospitalization: Part A is free if you qualify for Medicare. Everyone gets Part A. Some people (mainly those who did not pay enough into the system via payroll taxes) do not qualify. They can get Part A, however, if they pay monthly premiums.
• Part B. Medical services: Part B covers doctors’ appointments, ambulance services and medical treatments. Part B isn’t free. The standard cost for Part B in 2021 is $148.50 for people making $88,000 per year or less.
• Part C. Medicare Advantage: Part C is a bundled plan like a PPO or an HMO. Cost for Part C varies as it’s sold by private insurance companies. Most Part C plans include Parts A, B and D, as well as vision, hearing and dental.
• Part D. Prescription medication: Part D pays for 75% of prescription costs, although recipients still pay premiums, deductibles and copays. Plans are sold by private companies and are optional. Costs vary.

Because most Medicare plans aren’t free and many people need financial assistance, the government offers Medicare savings programs.

Medicare Savings Programs

Medicare Savings Programs help low-income recipients with Medicare costs including premiums, copays, coinsurance and deductibles. These programs supplement Medicare Parts A and B. There are 4 types of programs:

1. Qualified Medicare Beneficiary (QMB)
2. Specified Low-Income Medicare Beneficiary (SLMB)
3. Qualifying Individual (QI)
4. Qualified Disabled and Working Individuals (QDWI)

All savings programs apply to Medicare Part B, except QDWI.

1. Qualified Medicare Beneficiary (QMB) – QMB provides financial assistance to low-income Medicare recipients for help paying their Part A and Part B deductibles, as well as Part B premiums. Those who are eligible can also qualify for the Extra Help program. The Extra Help program helps pay monthly premiums, deductibles and copays for prescriptions. Income and resource limits for 2021:

• Individual monthly income limit: $1,094
• Married couple monthly income limit: $1,472
• Individual resource limit: $7,970
• Married couple resource limit: $11,960

Extra Help applies only to Part D, not Medicare Advantage or Medigap. See if you qualify for Extra Help.

• Individual monthly income limit: $1,308
• Married couple monthly income limit: $1,762
• Individual resource limit: $7,970
• Married couple resource limit: $11,960

These are federal income guidelines. Because income levels are different from state to state, limits will vary.

• Individual monthly income limit: $1,469
• Married couple monthly income limit: $1,980
• Individual resource limit: $7,970
• Married couple resource limit: $11,960

Again, these are federal income guidelines. Because income levels are different from state to state, limits will vary. QI recipients cannot also qualify for Medicaid benefits. 

• Individual monthly income limit: $4,379
• Married couple monthly income limit: $5,892
• Individual resource limit: $4,000
• Married couple resource limit: $6,000

If you have Medicare but you lost your Social Security Disability Insurance (SSDI) benefits when you returned to work, the QDWI program assists you financially as long as you fall within the listed income guidelines.

All Medicare Savings Program recipients must qualify for Medicare and must be U.S. citizens or permanent residents.

How Do You Apply for Medicare Savings Programs?

Before you apply, make sure you’re eligible for Medicare Part A. You must demonstrate financial need by qualifying for certain income levels. 

If you feel that you do indeed qualify, the first step is to contact your state’s Medicaid offices. The Medicare Savings Program, while funded by the federal government, is administered by the states. If you qualify for Medicaid, you do not need a Medicare Savings Program.

To see if you qualify, the first step is to fill out Social Security’s Benefit Eligibility Screening Tool. Resources used to determine eligibility include:

• Checking accounts
• Savings accounts
• Investments like mutual funds, bonds, stocks and IRAs

Resources not counted when determining eligibility include:

• Your home (your primary residence only)
• Your car (limited to 1 automobile per family)
• Household and personal items like jewelry, furniture and appliances

Be sure your income levels are within the required guidelines (see income and resource limits for 2021 listed above).

If you believe you qualify, apply online at the Medicare Benefits page at SSA.gov. You can also call your State Medicare Program.

Get Started Early

Why struggle to pay premiums you can’t afford when there is plenty of financial assistance out there? Federal and state governments offer programs to help Medicare recipients bridge the financial gap. 

Find out if you qualify for financial assistance right away, because we all know that the wheels of government turn slowly. Don’t find out later, after you’ve spent money you really need, that you could have saved that money all along.

Best Medicare Insurance

Need supplemental coverage for your Medicare policy? Supplemental plans like Medigap are sold through private insurance companies. There are so many out there, where do you begin? Don’t worry. Benzinga has put together a list of trusted companies just for you.

Medicare Savings Programs Save You Money

If you have Medicare but can’t afford it, there’s a financial assistance program for you. Even if you don’t qualify for Medicaid, chances are you’re eligible for one of the 4 Medicare Savings Programs.To see if you qualify, contact your state’s local Medicaid office. Check out this comprehensive list of the states and their Medicaid offices at Medicaid.gov.

Frequently Asked Questions