Extra Help – Financial Assistance for Medicare Prescription Drug Costs

For Medicare beneficiaries living on a fixed income, prescription drug costs can be one of the most stressful parts of managing their health. Even with a Part D plan in place, monthly premiums, deductibles, and copayments can add up quickly — sometimes forcing people to make the impossible choice between medications and other necessities. That's precisely why the Extra Help program exists. Formally known as the Low-Income Subsidy (LIS), Extra Help is a federal program administered by the Social Security Administration that provides meaningful financial relief on prescription drug costs for those who qualify.

What is Extra Help?

Extra Help is designed for Medicare beneficiaries who have limited income and resources. When approved, the program steps in to significantly reduce — or in some cases eliminate — the out-of-pocket costs associated with a Medicare Part D prescription drug plan. This includes help with premiums, deductibles, and the copayments charged at the pharmacy counter. For people managing chronic conditions who depend on multiple medications, the savings can be thousands of dollars a year.

Eligibility for Extra Help

Eligibility is determined by both income and assets, and the thresholds are reviewed annually. As of 2021, the following income and resource limits applied for Extra Help:

• Income Limit: The annual income must be below a specific threshold, which may vary each year. For 2021, the individual's annual income should be below $19,320, and for couples, it should be below $26,130.
• Resource Limit: The total value of the individual's assets, including bank accounts, investments, and property (excluding the primary residence and some other exclusions), should not exceed $14,790 for individuals and $29,520 for couples in 2021.

It's worth noting that certain individuals are automatically enrolled in Extra Help without needing to apply — specifically, those who already qualify for full Medicaid, Supplemental Security Income (SSI), or a Medicare Savings Program. If you fall into one of these categories, you should receive a notice from the Social Security Administration confirming your enrollment.

Benefits of Extra Help Qualified Medicare beneficiaries who receive Extra Help may enjoy the following benefits:

1. Reduced Prescription Drug Costs: Extra Help significantly lowers out-of-pocket costs for prescription medications, including premiums, deductibles, and copayments. Depending on the level of subsidy received, some beneficiaries pay little to nothing for their covered drugs.
2. No Late Enrollment Penalty: Beneficiaries receiving Extra Help are exempt from late enrollment penalties for Medicare Part D prescription drug coverage — a meaningful protection for those who may have delayed enrollment due to cost concerns.
3. Continuous Coverage: Extra Help ensures continuous access to prescription drug coverage, even if the beneficiary experiences changes in their financial situation, providing a reliable safety net when it's needed most.

How to Apply for Extra Help

Applying is straightforward and free. Eligible individuals can take the following steps:

1. Contact Social Security Administration: Call the Social Security Administration at 1-800-772-1213 (TTY 1-800-325-0778) or visit their website to apply online. The SSA handles all Extra Help applications regardless of the Medicare plan involved.
2. Provide Necessary Information: The applicant will need to provide information about their income, resources, and other relevant details. Having recent bank statements and tax documents on hand can help speed the process along.
3. Receive Confirmation: Once the application is reviewed and approved, the applicant will receive a confirmation notice indicating their eligibility for Extra Help and explaining the level of subsidy they'll receive.

Prescription drug costs shouldn't stand between anyone and the medications they need to stay healthy. Extra Help — the Low-Income Subsidy program — was specifically designed to ensure that Medicare beneficiaries with limited financial resources can access their prescriptions without facing crushing out-of-pocket costs. If you or a loved one might qualify, it's worth taking a few minutes to check eligibility and apply. The potential savings are substantial, and the application process, handled entirely through the Social Security Administration, is free.